Telecoms companies are building ever more functionality into their networks so, despite the downturn, the market for intelligent optical chips is still growing.
By Antony Savvas
With telcos building ever more functionality into their networks to help them cope with discrete user needs and fluctuating traffic requirements, the market for intelligent optical chips is inevitably growing despite the telecoms market being in the doldrums.
In response, the chip manufacturers have expanded their capacity in the intelligent chip manufacturing processes, and the area is seen as a potentially lucrative market for investors as network suppliers start integrating these chips into their switches, routers and other management solutions.
The move by the telcos to expand and improve their networks in metropolitan areas has led to a worldwide increase in the demand for intelligent optical network hardware in these areas. Analyst Infonetics Research says that revenues from hardware destined for metro networks hit USD1.02bn in the first quarter of this year, which was a 15% increase from the fourth quarter of last year.
Many of the big casualties in the networking and telecoms field over the last 12 months were perhaps too reliant on extremely tight longer-haul markets, and this is illustrated by the decrease in demand for intelligent optical networking hardware for long-haul and submarine connections logged by Infonetics.
The analyst further says that the market for these two combined decreased by 31% compared to the previous quarter, falling from USD1.55bn to USD1.08bn. The premise that the demand for optical chips is set to continue to increase in areas beyond long-haul is supported by Infonetics principal analyst Michael Howard, who says, "An interesting trend has emerged - the closer the customer, the faster the spending is increasing.
"Since carriers have considerably slowed the build-out of their long-haul networks, the decline in long-haul and submarine spending is not surprising. But what gives us hope for the optical market and more generally for the telecoms equipment space is the continuing rise of bandwidth requirements by business and consumers, which translates into the increased spending on kit for the other areas."
In terms of the chips themselves, what are the technology trends and the main market direction of the products?
Hal Zarem, vice president of sales and marketing at DWDM specialist Silicon Light Machines (a subsidiary of Cypress Semiconductor), says, "Optical networks are becoming more complex - with higher data rates, increased spectral density and changing bandwidth demands.
"As DWDM systems evolve, yesterday's fixed networks are giving way to those in which traffic loads and system requirements are constantly changing."
Zarem says that, to keep pace with this network evolution, telecom components vendors must develop products that are dynamic, tunable and software-configurable - enabling telecom service providers to layer service more quickly and easily.
In addition, he says, component manufacturers must offer these advanced capabilities at price points that did not previously exist.
Also, components vendors must provide future-proofed products that easily adapt with advanced technologies on the horizon for service providers.
As carriers transition to advanced networks - 40Gbit/s, smaller footprints, tighter channel spacing (50GHz to 12.5GHz) and lower power - they require systems with components that keep pace with these trends and address new issues with innovative approaches.
Micro-electromechanical systems (MEMS) are gaining prominence in the field of dynamic optical components. MEMS technology can enable the development of optical devices that are configurable in-situ, as opposed to the static optical devices historically used in optical networks.
Additionally, MEMS share many desirable traits with semiconductors - they are small, fast, low-cost and reliable.
Zeljka Matutinovic (Fig. 1), a general partner in investment company Jerusalem Venture Partners (JVP), is in a suitable position to survey the terrain, because she is currently working on optical chip investment deals across Europe.
Matutinovic tells Lightwave Europe, "The optical component space currently suffers from multiple proliferating technologies and a lack of standards in manufacturing and packaging processes.
"At JVP we believe the space will have to consolidate over time to make optical gear affordable in telecoms networks, and one aspect of this consolidation is the trend towards integrating multiple optical functions on a single chip."
She says, "We've invested in a few companies that are doing just this, like InPlane Photonics and Cyoptics which are young companies. The advantage of this integration is lower cost, with optical chips being made using similar techniques as in electronic chip manufacturing, with significantly decreasing component size resulting in lower costs."
At JVP, Matutinovic says the company is looking at several possible new and innovative integration paths. These include monolithic integration on
III-V-based materials such as indium phosphide, gallium arsenide and others. Matutinovic said these are generally accepted as optical materials and used for discrete devices and subsystems today, and she points out that several companies have integration roadmaps based on monolithic integration of III-Vs.
Silicon as an optical platform is another area which JVP is considering. Matutinovic says "more and more noise" is being made about this option as an integration platform for optical components, as silicon is readily available and relatively cheap. JVP sees silicon for optical integration as a hybrid solution.
Other technology platforms like polymers and LCD-based components are also an option. However, the problem is that different materials suit different functions, so it is difficult to find a single material suitable for manufacturing an entire integrated sub-system. Such technologies will be used in certain applications, says Matutinovic.
JVP says performance will not be hindered by this drive for integration on optical chips, and the fact that they will be more "tunable" makes for better network control and usability, in addition for better inventory management for the hardware suppliers.
The importance of optical chip integration is confirmed by John Mansbridge of Roke Manor Research, the well known electronics research and development business located in the UK.
Mansbridge says, "Optical chips implement the same functions as discrete optical components but in a more compact and cost-effective form. Indeed, in a lot of cases the same technology is used to make the individual functional devices in the discrete component.
"A substantial part - figures vary between 50 and 80% - of the cost of discrete optical components lies in the fibre attachment (pigtailing) and packaging process of fibre interfaced optical components.
"So, by incorporating and/or interconnecting multiple devices on a single chip, only one set of packaging costs is incurred for all the devices, thus having a significant impact on the component economics."
In addition, says Mansbridge, especially for III-V material systems - where the waveguide mode size can be particularly small and significant coupling losses can be incurred at each fibre/waveguide interface - the integration of multiple interconnected components can enable better overall system performance or even functionality that can't be achieved using discrete components.
This is because, in the integrated component, there are no internal interface losses between components since the same waveguide structure interconnects them all.
And another benefit of optical integration is that the chips are much less susceptible to environmental effects compared to discrete solutions, since all the elements are contained on a single substrate in a common package.
So how is the development of optical chips going? The first stage in the commercial development of optical chips involved the application of wafer-scale processing to produce single-function chips, covering lasers, Mach-Zehnder or electro-absorption modulators (EAM), splitters/couplers, and arrayed waveguide gratings (AWG).
The second stage has involved the integration of two functions onto one chip: for instance, the combination of a CW (continuous wave) laser with an EAM in indium phosphide to give a modulated laser or a 40-channel AWG with variable optical attenuators (VOA) in silica-on-silicon, to give a DWDM mux/demux device with dynamic loss levelling. While this example represents the integration of only two distinct functions, it actually represents the integration of more than 40 individual components, since there is one VOA for each channel.
Thanks to the success of these first two stages of development, the integration of optical components and functions on chips is now well set to gain momentum.
Contributing Editor, Lightwave Europe
Antony Savvas is also a freelance networks and telecoms journalist: firstname.lastname@example.org
Optical chips are analogous to electronic ICs in that they represent higher levels of integration for optical functionality. Integrated optics is a central technology to achieving substantial cost and size reductions for optical hardware in telecoms and other volume applications.
A major difference is that, whereas electronic integration has been on the basis of fitting more and more of essentially the same small basic device (a transistor) in one predominate material system (silicon), optical integration involves a much wider range of device functions - lasers, modulators, photodetectors, switches, gratings, arrayed waveguide structures, and others. The materials which can be used are also more varied, such as silica-on-silicon, lithium niobate, silicon-on-insulator, III-V materials such as InP and GaAs, polymer, and sol-gel glass.
As with electronics, planar processing of wafers using photolithography is key to achieving low costs, and optical chip manufacturing uses a lot of the processes that have been developed for electronics.
Optical chip processing is simpler since the minimum feature sizes are a few microns rather than the sub-micron resolution needed for electronic gates.
Submarine - down 38%
Long-haul - down 28%
Metro core/regional - up 12%
Metro edge - up 16%
Customer premises equipment - up 21%
Source: Infonetics Research
- Opto-hybrid integration - the integration of separate, discrete chip components onto a common substrate containing interconnecting waveguides.
- Silicon microbench - a subset of opto-hybrid integration that uses free-space optical coupling between components rather than defined waveguides.
- Monolithic integration - the fabrication and integration of all components on a common substrate.
Analog Devices Inc (ADI) has introduced a single-chip fibre-optic average power controller with closed-loop control and broad bias current ranges for optimal CW laser performance.
With integrated electro-optical interface solution features, a low component count and PCB area savings, the ADN2830 is particularly suited for the 10Gbit/s market, which requires externally modulated CW lasers.
The ADN2830 is also suited for erbium-doped fibre amplifier applications, for which the required bias current may be up to 800mA.
Vitesse Semicoductor's VIT10 family of DWDM 10Gbit/s optical transponders (pictured, centre) offer a cost-effective alternative to the conventional discrete transponder line card design for emerging LR-2 applications. Customers can get a longer reach with flexible feature sets in a smaller package. The VIT10 family is designed to suit both metro and long-haul communications applications.
With its Eyemax chip solution, Applied Micro Circuits Corp (AMCC) is combining its enhanced forward error correction (EFEC) technology with dispersion compensation capabilities.
The first AMCC products to benefit from this move are a combination of the Niagara (S19208) EFEC mapper and the SuperPHY family of physical layer products. As well as EFEC and dispersion compensation, the pair can also cover jitter, edge rates, input sensitivity, output swings, and bandwidth considerations.
Maxim Integrated Products has launched the 3.3V MAX3971A 10.7Gbit/s limiting amplifier, for use in long-reach 10Gbit/s optical receivers. This is an improvement on the previous 10.3Gbit/s version, with reduced jitter, lower power consumption and better sensitivity. The MAX3971A accepts differential CML signals and provides a differential CML output with edge speeds of 20ps. The limiting amplifier generates only 1.8ps of deterministic jitter (with 800mV input) and 0.6ps of random jitter.
Infineon's OC-768 line-card solution consists of a Multi-Chip Package mux/demux and a two-chip framer/pointer processor, and is designed to eliminate interoperability hurdles to reach 40Gbit/s deployment throughout metro and long-haul environments. The framer/pointer processor consists of an OC-768-to-OC-192 interface converter and the multiplexer features clock management functionality as well as a selectable 20GHz and 40GHz clock output to support both No Return to Zero and Return to Zero line coding. The demultiplexer integrates clock and data recovery functionality with high output sensitivity of 50mV.
Cypress's family of SONET OC-48/SDH STM-16 SERDES products provides building blocks for high-speed systems. They are available as both stand-alone and programmable SERDES solutions. All devices integrate parallel-to-serial and serial-to-parallel conversion, clock synthesis, clock and data recovery, and a limiting amp into a single chip.
Mindspeed Technologies (pictured below) has developed a single-chip solution for difficult signal timing challenges surrounding the edge of optical networks. Designed for performing critical jitter-attenuation and signal de-synchronisation functions in both telecoms and data communications kit at the optical edge, the first devices to use the Digital Jitter-Attenuation Technology (DJAT) technology are the 12-port M28320, 6-port M28326 and 4-port M28324 solutions.
The DJAT technology replaces more expensive application-specific IC (ASIC) and analogue components with a digital solution that is smaller, less costly and significantly more power efficient.