Co-packaged optics (CPO) means placing the parts that turn electrical signals into light inside the same package as a switch chip or a processor, instead of in separate plug-in modules at the front of the equipment. A package is the case that holds a chip and joins it to the circuit board. The aim is to move data between AI chips using less electricity.
Here is how a data centre switch sends data over fibre today. The switch chip sits in the middle of the circuit board. Each of its signals travels as electricity along copper tracks on the board, about 15 to 30 cm, to the front panel. There, a plug-in optical module, called a transceiver, turns the electrical signal into pulses of laser light. The light then travels along an optical fibre. Fast electrical signals weaken quickly along copper. So both the chip and the module need extra circuits that clean up and strengthen the signals, and these circuits use a lot of power.
Co-packaged optics removes most of that copper. Small optical engines, chips that turn electrical signals into light, are placed in the package right beside the switch chip. The electrical path shrinks from tens of centimetres to a few millimetres, so much less power is needed to keep the signal clean. Fibres then run straight from the package to the front panel.
Consider a switch in an AI data centre run by a large cloud company in the United States, where most early co-packaged optics is being installed. Its switch chip has 64 ports of 800 gigabits per second each, which is 51.2 terabits per second in total. With plug-in modules, it needs 64 transceivers of about 15 watts each, so its optics use about 960 watts. With co-packaged optics, each 800-gigabit port uses about 5.5 watts, so the optics use about 350 watts. That saves about 600 watts in one switch. An AI data centre can have thousands of such switches. Across 1,000 switches, the saving is about 0.6 megawatts, before counting the power saved on cooling.
The same idea is being applied to the links between processors, part of chip interconnect. As GPUs and switches get faster, copper links can reach only a metre or two, and light carries the data further for the same power. The page on bandwidth and latency explains why these links matter.
There are trade-offs. A plug-in module that fails can be pulled out and replaced in seconds. An optical engine inside the package cannot. So most designs keep the lasers, the parts most likely to fail, in separate replaceable modules, and send their light into the package. Testing is also harder, because a fault in one optical engine can mean replacing the whole switch chip package. The switches are built on the same networking chips that are being redesigned for this. Designing these links is among the most demanding work in India's chip design centres.
Co-packaged optics works inside one building. Links between buildings, kilometres apart, use different equipment, called data centre interconnect (DCI).