The Zhitong Finance App learned that according to TrendForce Jibang Consulting's latest “2027 Infrared Sensing and Optical Communication Market Trends”, as demand for scale-up (vertical expansion) network transmission within data centers grows rapidly, VCSEL NPO is valued for its advantages such as low power consumption, high maintenance flexibility, and relatively perfect supply chains. The main manufacturers are Lumentum, Furukawa Electric (Furukawa Electric), Coherent (Furukawa Electric), Broadcom (AVGO.US) ), ams OSRAM (ams OSRAM), and HiSilicon (HiSilicon) are all invested in research and development. From 2027-2028, many VCSEL NPO solutions will appear on the market, compounding the demand for short-range optical transceiver modules. It is estimated that the VCSEL market demand will reach 650 million units in 2031, and the composite growth rate will be 38% in 2025-2031.
In the scale-up network architecture of AI data centers, active cables (AEC) mainly use multiple retimers (Retimers) to solve the problems of data loss and signal attenuation. However, as transmission rates enter the 1.6 Tbps generation, the attenuation of high-frequency electrical signals on copper wires has increased significantly, making short-distance transmission expected to accelerate the shift to optical interconnect technology, including VCSEL NPO and micro LED CPO architectures.
Looking at vendor layout, Lumentum, Furukawa Electric, Coherent, Broadcom, ams OSRAM, and HiSilicon use VCSEL NPO solutions to lay out future scale-up network business opportunities. Coherent, Broadcom, ams OSRAM, and HiSilicon use mature 850nm VCSELs with photodiodes to achieve a total bandwidth of up to 3.2 Tbps, but dispersion issues will limit future transmission distance and bandwidth improvements. Lumentum, Furukawa Electric, and Coherent (planned) use a high-cost 1,060nm VCSEL solution, which has extremely high fiber coupling efficiency, low dispersion, low relative intensity noise (RIN), and excellent high temperature resistance to support future higher transmission rate requirements.
TrendForce Jibang Consulting pointed out that Micro LED CPO and VCSEL NPO need to be integrated with ASIC/GPU chips through an array of transceiver components to achieve extremely low power consumption and ultra-high density transmission performance. Although Micro LED CPO has long-term potential to reach the theoretical limit of bit power consumption, it is still at the stage of supply chain maturity and technology development, such as massive transfer, optical fiber compatibility, and coupling efficiency.
Compared with Micro LED CPO, VCSEL NPO already has more mature commercial conditions in terms of bit power consumption, maintenance flexibility, and supply chain integrity. Whether it is an 850 nm or 1,060 nm solution, it can meet the high density transmission needs of AI data centers, balance performance and implementability, and is a highly competitive deployment solution in the current scale-up optical interconnect architecture.
In the future, VCSEL NPO will focus on improving overall performance. On the one hand, the optical side will focus on the optimal combination of VCSEL wavelength and optical fiber; on the other hand, it will focus on upgrading VCSEL chip technology, including increasing the rate of a single VCSEL from 100G to 200G, and developing a smaller single Micro VCSEL (100-200µm) to increase transmission bandwidth through higher density, multi-channel arrays. Overall, the VCSEL NPO program continues to optimize performance, technical maturity, and supply chain integrity to accelerate the construction of an industrial moat.