Good article Oz. This supports the reason why Suresh is identifying POET's optical interposer light source as a solution for silicon photonics.

It also explains why the margin between PSM4 and CWDM4 widens between silicon photonics and the POET optical interposer.

PSM4:

Parallel Single Mode 4-channel (PSM4) is a type of single-mode transceiver that uses a parallel fiber design for reaches from up to 2 km and for reaches beyond the limits of 100-meter Short Reach 4-channel (SR4) multi-mode transceivers. 

PSM4 is built using one laser (instead of four), split into four paths or channels and separately modulated with electrical data signals. Each channel has its own fibers and is separated throughout the link. PSM4 uses eight-fibers with four-fiber for transmission and four-fibers for receiving. A parallel, eight fiber Multiple Push On (MPO) optical connector is used.

Here is a clear statement that captures the pricing model between PSM and CWDM as it exists today from the Mellanox blog. This  model is  premised on the fixed cost of fiber and the existing pricing of PSM4 and CWDM4 transceivers which becomes a variable with the introduction of POET:

The PSM4 transceiver is the lowest cost, 100Gb/s transceiver on the market capable of using single-mode fiber for long reaches up to 2km. The best use case is at reaches less than 500 meters. When tallying up the cost of longer reaches, the cost of the eight fibers adds up for each meter and the CWDM4, using two fibers, becomes more economical.

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Key statements by Suresh which for me is an indication that as companies ramp to CWDM4 they will be compelled to use the POET optical interposer platform in whole or in part.

Our waveguide integrated active indium phosphide devices that has detectors or lasers which are a critical component of the Optical Interposer platform are also directly compatible with conventional silicon photonics technology. The vast majority of today's silicon photonic solutions do not integrate lasers at wafer scale. Relegated to a die scale assembly, the true merits and cost advantages of wafer scale integration are lost.

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100G capable transceivers began volume adoption in 2017 replacing prior 40G devices. In the United States, data center operators decided to adopt the standard which did not require the multiplexing of signals onto a single fiber,so-called PSM4, which stands for Parallel Single Mode 4 channel.

The existing markets for these first generation 100G devices are now saturated. Data center operators in China began adopting 100G transceivers this year, but have largely been demanding a transceiver protocol that can handle multiplexing. So, the industry is now at the beginning of the introduction of a second generation of 100G adoption based on this coarse wavelength division multiplexing, also called the CWDM standard.

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POET’s Optical Interposer technology has drawn interest from multiple Tier 1 customers for applications spanning from component-level integration to subassemblies to full integration of optics and control electronics for transceivers. We're also seeing high interest for future applications of our Optical Interposer to enable direct optical interconnect into ASICs.

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The advantage of the POET Interposer platform is that such customization can be done with minimal incremental development. This allows us to leverage our Optical Interposer solutions by increasing the level of integration for our customers’ existing or planned data communication products.

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We have already aligned with our customers on their production volumes and pricing requirements, so that once we successfully demonstrate the platform capabilities and it is qualified, we expect to receive production volume orders for Optical Interposer-based components and subassemblies for inclusion in customers’ products beginning in the second half of 2019.

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Suresh:

There is no better way to introduce technology to market than with substantial financial and engineering support of the leading companies in these markets, since the Optical Interposer and laser platform are speed agnostic and a single solution supports the requirements for both 100G and 400G, and an acceleration of 400G is completely synergistic with the deployment of 100G and within our development and product roadmap.