IBM (NYSE:IBM) Light Technology Will Bring Big Profits

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The sign at the IBM facility near Boulder, Colorado is seen with the Boulder Flatiron mountains in the background
The sign at the IBM facility near Boulder, Colorado is seen with the Boulder Flatiron mountains in the background, September 8, 2009.

The use of light over electronics will have future applications in all the devices that we use, IBM is already cheap at 12 times earnings and today’s news makes it look like a bargain.

IBM light technology will change everything, literally. Silicon Nanophotonics is the study and application of photonic systems which use silicon as an optical medium.

The silicon is usually patterned with sub-micrometre precision, into microphotonic components. These operate in the infrared, most commonly at the 1.55 micrometre wavelength used by most fiber optic telecommunication systems. The silicon typically lies on top of a layer of silica in what (by analogy with a similar construction in microelectronics) is known as silicon on insulator (SOI).

Silicon photonic devices can be made using existing semiconductor fabrication techniques, and because silicon is already used as the substrate for most integrated circuits, it is possible to create hybrid devices in which the optical and electronic components are integrated onto a single microchip.[1] Consequently, silicon photonics is being actively researched by many electronics manufacturers including IBM and Intel, as well as by academic research groups such as that of Prof. Michal Lipson, who see it is a means for keeping on track with Moore’s Law, by using optical interconnects to provide faster data transfer both between and within microchips.

The propagation of light through silicon devices is governed by a range of nonlinear optical phenomena including the Kerr effect, the Raman effect, two photon absorption and interactions between photons and free charge carriers. The presence of nonlinearity is of fundamental importance, as it enables light to interact with light,thus permitting applications such as wavelength conversion and all-optical signal routing, in addition to the passive transmission of light.

IBM (NYSE:IBM) announced today a major advance in the ability to use light instead of electrical signals to transmit information for future computing. The breakthrough technology – called “silicon nanophotonics” – allows the integration of different optical components side-by-side with electrical circuits on a single silicon chip using, for the first time, sub-100nm semiconductor technology.

Silicon nanophotonics takes advantage of pulses of light for communication and provides a super highway for large volumes of data to move at rapid speeds between computer chips in servers, large datacenters, and supercomputers, thus alleviating the limitations of congested data traffic and high-cost traditional interconnects.

“This technology breakthrough is a result of more than a decade of pioneering research at IBM,” said Dr. John E. Kelly, Senior Vice President and Director of IBM Research. “This allows us to move silicon nanophotonics technology into a real-world manufacturing environment that will have impact across a range of applications.”

The amount of data being created and transmitted over enterprise networks continues to grow due to an explosion of new applications and services. Silicon nanophotonics, now primed for commercial development, can enable the industry to keep pace with increasing demands in chip performance and computing power.

Businesses are entering a new era of computing that requires systems to process and analyze, in real-time, huge volumes of information known as Big Data. Silicon nanophotonics technology provides answers to Big Data challenges by seamlessly connecting various parts of large systems, whether few centimeters or few kilometers apart from each other, and move terabytes of data via pulses of light through optical fibers.

Building on its initial proof of concept in 2010, IBM has solved the key challenges of transferring the silicon nanophotonics technology into the commercial foundry. By adding a few processing modules into a high-performance 90nm CMOS fabrication line, a variety of silicon nanophotonics components such as wavelength division multiplexers (WDM), modulators, and detectors are integrated side-by-side with a CMOS electrical circuitry. As a result, single-chip optical communications transceivers can be manufactured in a conventional semiconductor foundry, providing significant cost reduction over traditional approaches.

IBM’s CMOS nanophotonics technology demonstrates transceivers to exceed the data rate of 25Gbps per channel. In addition, the technology is capable of feeding a number of parallel optical data streams into a single fiber by utilizing compact on-chip wavelength-division multiplexing devices. The ability to multiplex large data streams at high data rates will allow future scaling of optical communications capable of delivering terabytes of data between distant parts of computer systems.

Further details will be presented this week by Dr. Solomon Assefa at the IEEE International Electron Devices Meeting (IEDM) in the talk titled, “A 90nm CMOS Integrated Nano-Photonics Technology for 25Gbps WDM Optical Communications Applications.” Additional papers being presented by IBM at IEDM can be seen here.

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Shayne Heffernan Ph.D.Economist/Hedge Fund ManagerShayne Heffernan oversees the management of funds for institutions and high net worth individuals. He is also an active consultant working with Corporations around the World.He is recognized as one of the leading Economists in South East Asia, as well as the preeminent authority on ASEAN. His opinions and forecasts are widely read by decision makers in the region and Internationally.Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reached a peak of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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