Why Are Optical Devices Garnering Attention with the Arrival of the Generative AI Boom?

The launch of ChatGPT in November 2022 marked the dawn of the generative AI boom. IT giants, GAFA, also announced they were developing their own original generative AI technologies and the utilization of AI in society is becoming increasingly prevalent. The Japan Electronics and Information Technology Industries Association (JEITA) announced that "Global demand for generative AI market is expected to grow at a CAGR of 53.3%, reaching $211 billion by 2030, approximately 20 times the 2023 level" (December 21, 2023).

With the spread of AI, data centers are being increasingly drawn into the spotlight. Data center is the generic term used to refer to facilities for installing and operating servers and communication devices for the Internet. According to the 2023 White Paper on Information and Communications in Japan by the Ministry of Internal Affairs and Communications, the number of large-scale data centers is increasing worldwide, and the global market for data center systems is expected to reach 27.5081 trillion yen in 2022 (a 32.3% increase YoY).

Yasuhiro Yamauchi, General Manager of Optical Devices at Mitsubishi Electric’s High Frequency & Optical Device Works provided the following explanation as to why the data center market will thrive with the spread of AI.

About the Fiber-optic Communication Connecting Data Centers to Households

Data centers are connected to the outside world through fiber-optic communication. The servers and computational devices installed in data centers are also connected by optical fiber and function together.

Optical fiber is a light-conducting fiber made of glass or plastic. At the ends of the optical fiber there are optical transceivers which are equipped with both laser diodes (LD) and photodiodes (PD). These laser diodes and photodiodes are so-called optical devices. The electrical signals, which are the sources of information, are converted into optical signals by laser diodes and sent through optical fibers. Once an optical signal has reached its destination, the photodiodes then convert it back to an electrical signal, amplify the weakened portion and convey it as information. In other words, semiconductors that convert electrical signals to digital optical signals and vice-versa are referred to as "optical semiconductors" and "optical devices^*2."

1. *2At Mitsubishi Electric, optical semiconductors such as laser diodes and photodiodes as well as the equipment which includes these are referred to as "optical devices," therefore this article also uses this term for the sake of consistency. However it should be noted that "optical devices" is also used as a generic term to refer to equipment that uses light such as optical fibers and lenses.

A Close-up of Optical Devices

With approximately 50% of the global share, Mitsubishi Electric leads the market for optical devices used in data centers. These optical devices are embedded in a component called an "optical transceiver", which is located at the base of the optical fiber. Optical transceivers, which measure a mere 2 cm in width by 10 cm in length, contain as many as 8 pairs of laser diodes and photodiodes.

The Optical Device for Data Centers with the World's Top Share — How Does it Work?

In the data center market, where ultra-high speed and low power consumption are urgent issues, Mitsubishi Electric's "EML chip" holds approximately 50% of the world market share and is the top-ranking product. Here is how it works.
The basic mechanism of an optical device is to convert an electrical signal to an optical signal and switch between on and off to send/receive the digital signals of 0 and 1. This is achieved by one type of optical device called a DFB laser (distributed-feedback), which releases and stops current. DFB lasers are currently used on 5G mobile communication system base stations, etc. however they have reached their limit in terms of the ultra-high speed performance required by data centers, and also have the disadvantage of major power loss.
In response, Mitsubishi Electric developed "EML" as its proprietary technology. To describe EML configuration in simple terms, it is essentially the existing DFB laser with an optical modulator (see below) attached. The DFB laser is kept on by constantly applying current. Then, when voltage is applied to the optical modulator, light is absorbed and the optical signal is turned off. If the voltage is varied, the optical modulator shuts off and lets light through like a shutter, thus making it possible for signals to be sent faster than by the on-off keying of the current flowing through the DFB laser.

As a simple analogy, using the DFB laser is like turning a lamp on and off at the power button. With this method, there is an unavoidable time loss between the respective light on and light off states. As such, the DFB laser is incapable of supporting high-speed operations.
By contrast, the concept of EML technology is that the lamp light is left constantly on and the light is simply blocked or unblocked by placing or removing an obstacle (such as a desk pad).
In the EML, the component that serves as this hypothetical desk pad in order to block the light is called an "optical modulator." It offers the advantage of energy-saving as the lamp does not need to be turned on and off.

Mitsubishi Electric’s EML is unique because it integrates the DFB laser and optical modulator together in one chip, despite their entirely different structures. For example, DFB lasers emit bright light with minimal current, so efficient heat dissipation is preferable. As such, the entire area is embedded with semiconductor materials of various different compositions. On the other hand, the optical modulator has been machined into a slim body eliminating the capacitor in order to be capable of high-speed operation.
The simplified cross-section views below clearly show how the two structures differ entirely.

EML Contributing to the Development of Generative AI

In June 2023, roughly six months since the release of ChatGPT in November 2022, Mr. Yamauchi and his team received a large demand forecast from a business partner that manufactures optical transceivers. Moreover, in April of this year, Mitsubishi Electric began mass production of EML, which enables 200 Gbps high-speed communication on a single chip, for optical fiber connecting computational devices of generative AI.

Mitsubishi Electric began development of EML for optical communication in 1993. In 2023, shipments of EML for data centers exceeded a cumulative total of 30 million units. As more new IT technologies emerge, optical communications will no doubt require even higher speeds, higher capacities, and lower power consumption. At that point, EML and other optical devices will undoubtedly play a central role in satisfying such needs.