Anyone who follows the semiconductor industry is aware of Moore’s Law. Moore’s Law, for the uninitiated, is not a law at all, but an observation that Gordon Moore, the co-founder of Intel and Fairchild Semiconductor, made in a 1965 paper in which he described a doubling every year in the number of components that could be put on an integrated circuit.
The benefit is in the form of faster, cheaper and more powerful computers, mobile devices and the other electronics that dominate our daily lives. The original yearly doubling has been scaled back to a doubling every 18 months to 2 years, but for the past 5 decades, it’s been pretty accurate.
Moore’s Law describes what is going to happen, but says nothing about how it’s going to happen.
The integrated circuits that are at the heart of computers and mobile devices are based on silicon as the substrate for wafers and copper to connect all the components together and transfer data. The silicon and copper combination has been incredible successful, but in terms of Moore’s Law, this combination may have run its course. For decades, evolutionary advancements were able to keep Moore’s Law intact, but with silicon and copper, evolution may be about to hit a proverbial brick wall.
Enter “More than Moore”. For some time now, alternate technologies based on Silicon and other materials have augmented silicon chips and solutions to continue to provide functionality scaling. Photonics is one such technology which can augment the capabilities of existing silicon technology and can enable functional integration even in the absence of traditional Moore’s Law scaling.
Today, a revolution is needed in how components on the chip transfer data. Copper interconnects, both on chip and off chip, become extremely power hungry at high speeds and threaten to subvert the benefits of Moore’s Law scaling. This is where optical communications and POET Technologies comes in. Any good revolution needs a leader and leading the charge in the optoelectronics revolution is Silicon Valley-based POET Technologies.
POET Technologies (TSX: V.PTK, Forum) (which stands for Planar Opto-Electric Technology) has created an opto-electronic process platform that is designed to enable functional optical integration monolithically at the wafer scale. This integration, which has thus far been lacking in opto-electronics enables cheaper, smaller and more energy efficient solutions. And POET believes it is the only company that can achieve this level of disruption across the three axes of cost, power and form factor.
That’s the what, here’s the how: POET’s core technology is a new process for making devices using gallium arsenide as the substrate for wafers instead of silicon. Gallium arsenide has a number of advantages over silicon including faster speeds and lower energy consumption, but for POET, the real driver is the fact that gallium arsenide is the preeminent substrate for integrating optics on to the chip. Optical connections are much faster and more efficient than copper for transferring data inside and out of the chip.
“POET is building an opto-electronics process platform that for the first time ever, enables the core integration of optics and electronics on a single piece of a gallium arsenide wafer, which is something we believe nobody has done before,” says Dr. Suresh Venkatesan, CEO of Poet Technologies. “It enables a wide variety of applications as a consequence.”
Regarding Moore’s Law, Dr. Venkatesam explained: “What Moore’s law is really facing is that while computational speeds have gone up dramatically, communication speeds have not increased and as a consequence, the interconnects have become a bottleneck. So integrating optics on the chip is really the Holy Grail because you can unleash the performance defined by Moore’s Law by replacing copper with optics in high throughput applications. We believe that our technology takes a giant leap towards a potential solution towards addressing this bottleneck. If you can do that, you can dramatically lower power consumption and avoid other complexities that traditional Moore’s Law scaling has not been able to solve in the silicon world. ”
The first market that POET is planning to tackle is Data Centers. “For data centers, power has become critically important. Historically, the way you solve power problems is integrating multiple components monolithically on a single chip and that’s what has driven silicon technology for years. Now the optics world is primed for a similar transition to integrated solutions. POET is a very unique and offers the only integrated platform with gallium arsenide and optics so we are really excited to be rolling out a platform that is initially targeted at data centers.”
There is a significant challenge to move from copper to optics in a way that is cost effective. “POET is tackling the cost equation more so than any other technology by attacking it at the component level, the wafer scale packaging level and at the wafer scale test level. So that’s how we’re able to get the significant reduction in costs that we are looking to achieve. And as we do that, we will potentially become cost competitive with copper technology. At this point, the the advantages of optical connections are tremendous in terms of power savings. The tag line we like to use is: the performance of optics at near the price point of copper.” Other ancillary benefits of optics are lower weight, higher flexibility, smaller size and less Electro-Magnetic Interference (EMI), all of which are becoming significant pain points in high density installations.
And there is no doubt that the market that POET is attacking is huge, with the overall optical data communications market alone projected to grow to $5 billion in 2015. But the real question that investors need to ask is whether POET has the capability and means to disrupt such a massive industry.
“When people talk about value, there is lots of value in ideas and concepts, but what really creates value in a company is the ability to translate ideas from the lab into commercialized products and technologies,” says Dr. Venkatesan. “We have a team of highly talented individuals that left positions at other successful companies to come here because we think that the potential of the technology is immense. And we see an opportunity to make a game changing impact on the industry.”
In terms of building value through industry partnerships, POET is already closing deals with leading suppliers to the semiconductor industry. In January 2016, the company announced a multi-year development and production supply agreement with EpiWorks, Inc., a leading developer and manufacturer of compound semiconductor epitaxial wafers. During this agreement, EpiWorks will manufacture wafers for POET’s Monolithic Optoelectronics process platform using its advanced Metal Organic Chemical Vapor Deposition (MOCVD) production toolset.
The company will be providing a corporate update on its operational plan via a conference call on February 16th. More details on the call can be found here.
And is POET’s time now?
“As we develop our prototypes over the course of the year, we are poised for some major breakthroughs in terms of transitioning the technology out of the lab, validating it in some real manufacturing environments and proving the power of the disruption to the world. I think when that happens, this company catalyzes in a fairly significant way. So we believe we already have the market behind us. Everyone we’ve talked to has validated we are in fact addressing a demonstrable need that needs to be filled. We have validated that the technology is functional in the lab and can be transitioned over to a manufacturing environment, and we have a balance sheet that gets us through the next couple years.”
“With a lot of start-ups, those are the three elements of risk that you’ve look at: is there a market, is there a technology and do you have the money to see you through? I believe we have all three of those ingredients and it’s up to us to execute. And by setting systematic milestones, investors are able to very transparently watch our progress as we achieve our catalyst events in the coming quarters.”
The revolution has started and Dr. Moore will be pleased.
FULL DISCLOSURE: POET Technologies is a Stockhouse Publishing client.