Recently, semiconductors are being pointed out as the cause of heat generation and bottlenecks as the amount of data that is being exchanged not only externally but also internally, i.e. in interconnects between chips, is increasing exponentially.

AMD Vice President Bill En recently mentioned the importance of silicon photonics technology in his keynote speech at SEMICON Korea 2025.

To solve the challenge of large-capacity, high-speed data connection, various solutions such as TSV, HBM, and chiplet have been approached and developed from various angles, and experts are commonly solving this problem through packaging solutions that minimize the connection distance between logic and memory.

Recently, various speakers, including AMD Vice President Bill, Anand Nambiar, Merck Senior Vice President, and Imec CEO Luke van den Hove, mentioned and emphasized photonics technology at this year's Semicon Korea.

“One area we’re focusing on is photonics,” said Bill, AMD’s vice president of product development. “We’re looking at packaging to bring optical capabilities further into the compute die.”This integration could bring about tremendous improvements in data speed and efficiency on a systemic basis,” he predicted.

“Transmitting data over wires in silicon interposers is inefficient due to heat generation,” said Anand Merck, Senior Vice President. “Photonics uses light to increase data transfer speeds while reducing power consumption, and is currently being used in the latest and greatest AI servers.”

“Some AI servers we’ve seen integrate silicon photonics to reduce power consumption by up to 40 percent over previous generations,” he continued. “Photonics is a very nascent technology, but to achieve Moore’s Law and push the boundaries of physics, we need to integrate all the processors—CPUs, GPUs—with memory, sensors, and silicon photonics.”
The integration of electronics, which are strong in computation, and photonics, which are strong in communication, will allow future semiconductors to further increase their data processing capabilities, and servers based on optical communications and silicon photonics will be adopted as key technologies in AI data centers being built in the future. In fact, it is known that large-scale data centers are equipped with about a million optical transceivers.

According to market research firm TrendForce, global shipments of 400G and above optical transceivers were reported to reach 6.4 million units in 2023, and are expected to grow by approximately three times to 20.4 million units in 2024. In particular, it is predicted that the number will exceed 31.9 million units in 2025, with an annual growth rate of 56.5%.

Optical transceivers consist of laser diodes, modulators, and photodetectors, and EML (Electro-absorption Modulated Laser) diodes are preferred for high-speed applications. Major EML laser suppliers include Broadcom, Coherent, and Lumentum, which manufacture and supply their own products. Photodetectors dominate the market, along with the three companies mentioned above, and Hamamatsu Photonics of Japan.

It is estimated that there are about 10 companies that produce domestic optical transceivers, including Opticore, Optomind, Oisolution, and Light and Electronics. As domestic players have not yet achieved a significant market share, attention is focused on whether they will be able to benefit from the photonics market in line with the expansion of AI servers.