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With the increasing demand for cloud-based applications, datacom providers are pushing forward with expanding their distributed computing networks. Therefore, they and telecom provider partners are looking for data center interconnect (DCI) solutions that are faster and more affordable than before to ensure that connectivity between metro and regional facilities does not become a bottleneck.

Energy usage, space, simplicity, and cost-effectiveness all impact the efficiency of DCI infrastructure. These solutions must consider watts per bit, rack space, and simplified provisioning and operating expenditure. Previously, direct detect technology could fulfill these requirements for short-reach DCIs inside data centers and campuses. However, achieving the reach and bandwidths required for edge and metro DCIs required external amplifiers and dispersion compensators that increased the cost and complexity of network operations.

At the same time, advances in electronic and photonic integration allowed longer reach coherent technology to be miniaturized into QSFP-DD and OSFP form factors. This enabled the transport of 100G and 400G connections over a single wavelength and several hundreds of kilometers, which is ideal for edge and metro DCI networks. Provider operations teams found the simplicity of coherent pluggables very attractive. There was no need to install and maintain additional amplifiers and compensators as in direct detect: a single coherent transceiver plugged into a router could fulfill the requirements.

In the coming decade, the shorter-reach DCI links will also require upgrades to 400G, 800G, and Terabit speeds, and at those speeds, coherent technology comes close to matching the energy consumption of direct detect. This would make it competitive even for shorter links.

Coherent Dominates in Metro DCIs

The advances in electronic and photonic integration allowed coherent technology for metro DCIs to be miniaturized into QSFP-DD and OSFP form factors. This progress allowed the Optical Internetworking Forum (OIF) to create the  400ZR and ZR+ standards for 400G DWDM pluggable modules. With small enough modules to pack a router faceplate densely, the datacom sector could profit from a 400ZR solution for high-capacity data center interconnects of up to 80km. If needed, extended reach 400ZR+ pluggables can cover several hundreds of kilometers. As an example of their success, Cignal AI forecasts that 400ZR shipments will dominate in the edge applications, as shown in Figure 3.

Further improvements in integration can further boost the reach and efficiency of coherent transceivers. For example, by integrating all photonic functions on a single chip, including lasers and optical amplifiers, EFFECT Photonics’ photonic System-On-Chip (SoC) technology can achieve higher transmit power levels and longer distances while keeping the smaller QSFP-DD form factor, power consumption, and cost.

Campus DCI Is The Battleground of Direct Detect and Coherent

The campus DCI segment, featuring distances below ten kilometers, was squarely the domain of direct detect products when the standard speed of these links was 100Gbps. No amplifiers nor compensators were needed for these shorter distances, so direct detect transceivers are as simple to deploy and maintain as coherent ones. However, at 400Gbps speeds, the power consumption of coherent technology is much closer to that of direct detect PAM-4 solutions.

This gap in power consumption is expected to disappear at 800Gbps, as shown in the figure below. For Terabit speeds, the prediction is that coherent transceivers will be more efficient. Furthermore, as the volume production of coherent transceivers increases, their price will also become competitive with direct detect solutions. Overall, coherent transceivers are expected to scale up better in future upgrades.

Direct Detect Dominates Intra Data Center Interconnects (For Now…)

Below Terabit speeds, direct detect technology (both NRZ and PAM-4) will likely dominate the intra-DCI space (also called data center fabric) in the coming years. In this space, links span less than two kilometers, and for particularly short links (< 300 meters), affordable multimode fiber (MMF) is frequently used.

Nevertheless, moving to larger, more centralized data centers (such as hyperscale data centers) is lengthening intra-DCI links. Instead of transferring data directly from one data center building to another, new data centers first move data to a central hub. So even if the building you want to connect to might be 200 meters away, the fiber runs to a hub that might be one or two kilometers away. In other words, intra-DCI links are becoming campus DCI links, which requires their single-mode fiber solutions.

On top of these changes, the upgrades to Terabit speeds in the coming decade will also see coherent solutions challenge the power consumption of direct detect transceivers. PAM-4 direct detect transceivers that fulfill the speed requirements require digital signal processors (DSPs) and more complex lasers that will be less efficient and affordable than previous generations of direct detect technology. With coherent technology scaling up in volume and having greater flexibility and performance, one can make the argument that it will reach cost-competitiveness in this space, too.

Takeaways

Unsurprisingly, the decision of using coherent or direct detect technology for DCIs boils down to the reach and capacity needs. Coherent is already established as the solution for metro DCIs and is already gaining ground in the campus DCI segment for 800G and Terabit speeds. With the move to Terabit speeds and scaling production volumes, it could also become cost-competitive inside the data center too. Overall, the datacom sector is moving towards coherent technology, and it pays off to have this in mind when upgrading data center links.