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Pluggable Modules and the Arrival of CPO

    In the rapidly evolving landscape of data center and high-performance computing infrastructure, the demand for higher bandwidth, lower latency, and improved energy efficiency has intensified the competition between traditional optical pluggable modules and emerging co-packaged optics (CPO) technologies. The question arises when it makes sense to switch to CPO. As data traffic surges, driven by artificial intelligence (AI), machine learning, and cloud computing, the limitations of conventional pluggable optical modules—particularly their power consumption and scalability—have become increasingly apparent. CPO, which integrates optical components directly with switch application-specific integrated circuits (ASICs), promises transformative gains in power efficiency, bandwidth density, and system integration, albeit with challenges in cost and manufacturing complexity. In this report, we synthesize the latest advancements and trade-offs between these two paradigms, drawing on recent industry developments, technical analyses, and economic feasibility studies to provide a comprehensive comparison.
    Power Efficiency: The power efficiency of optical interconnect technologies has emerged as a critical differentiator in data center operations, where energy costs and thermal management constraints dominate infrastructure planning. Traditional pluggable optical modules, which rely on discrete digital signal processors (DSPs) and clock data recovery (CDR) circuits, exhibit significant power consumption at higher data rates. For instance, a 400G pluggable optical module consumes approximately 30 W, with the DSP alone accounting for nearly 4 W of this total. This overhead stems from the need for signal conditioning, error correction, and electrical-to-optical conversion across relatively long PCB traces between the switch ASIC and the pluggable module. In contrast, CPO eliminates the physical separation between the optical engine and the switch chip, integrating both into a single package. This co-location reduces the electrical signal path length, minimizing propagation losses and the need for power-hungry DSP-based signal recovery. Early implementations of CPO have demonstrated 30–50% reductions in power consumption compared to pluggable modules, with some designs achieving single digit pJ/bit energy efficiency. Look at Broadcom, Intel and Nvidia. For example, Broadcom’s 7th-generation CPO switches have shown an 80-fold increase in bandwidth with only a 22-fold rise in system power consumption—a marked improvement over the 3× power escalation observed in DSP-based solutions. However, CPO’s power savings come with trade-offs. The integration of photonic and electronic components within a single package introduces thermal management challenges, as the proximity of heat-generating ASICs to temperature-sensitive optical devices requires advanced cooling solutions. Pluggable modules, by contrast, benefit from modularity, allowing for localized cooling and easier replacement of faulty components without disrupting the entire system.
    Bandwidth density: The amount of data throughput per unit area—has become a critical metric for hyperscale data centers seeking to maximize rack-level performance. Pluggable optical modules, constrained by their standardized form factors (e.g., QSFP-DD, OSFP), face inherent limits in port density due to the physical space required for electrical connectors and heat dissipation. Current high-end pluggable modules, such as 800G OSFP units, provide up to 25.6 Tbps per rack unit in a 32-port configuration, but this is insufficient to meet the projected demands of AI training clusters and exascale computing. CPO addresses this bottleneck by co-packaging multiple optical engines alongside the switch ASIC, effectively eliminating the need for bulky electrical interconnects. Kyocera’s prototype on-board optics module, for instance, achieves a record 512 Gbps bandwidth in a compact 43.5 × 30 × 8.1 mm footprint—5× denser than conventional 100 Gbps modules. This integration enables CPO switches to support 51.2 Tbps aggregate bandwidth in a single chip, a feat demonstrated by Broadcom’s Bailly CPO switch platform. The reduced signal path length also enhances signal integrity, enabling higher modulation formats like PAM-4 and PAM-6 without additional power penalties. Nevertheless, the transition to CPO necessitates a reimagining of switch architecture. The tight coupling of optics and electronics demands precision in photonic-electronic co-design, as misalignments of even a few micrometers can degrade performance. Pluggable modules, with their standardized interfaces, offer greater flexibility for incremental upgrades and interoperability across vendors.
    Integration Complexity: The integration of optical and electronic components in CPO represents both a technological breakthrough and a manufacturing hurdle. Traditional pluggable modules leverage well-established semiconductor fabrication processes, with separate supply chains for optical engines, DSPs, and packaging. This modularity simplifies production and allows for economies of scale, particularly for high-volume products like 100G and 400G transceivers. CPO, by contrast, requires heterogeneous integration of silicon photonics with CMOS-based switch ASICs. This process involves wafer-level bonding, through-silicon vias (TSVs), and advanced packaging techniques such as fan-out wafer-level packaging (FoWLP) such as used by Broadcom. While these methods reduce latency and power consumption, they escalate manufacturing complexity and cost. For example, packaging and testing account for nearly 80% of the total cost of a single-mode CPO transceiver, driven by the need for high-precision fiber alignment and hermetic sealing. Silicon photonics platforms, such as those developed by Intel and GlobalFoundries, aim to mitigate these costs through more integration and highly automated fiber alignment processes. But widespread adoption remains contingent on volume production. Pluggable modules also benefit from backward compatibility. Existing infrastructure, such as faceplate connectors and heat sinks, can accommodate newer generations of pluggable modules with minimal redesign. CPO, however, demands a holistic re-engineering of switch chassis, including custom PCB layouts and thermal solutions, which complicates retrofitting in legacy data centers.
    Cost Analysis: The economic viability of CPO versus pluggable modules hinges on a nuanced balance between upfront costs and long-term operational savings. Pluggable optical modules currently dominate the market due to their lower capital expenditure (CapEx). A 400G QSFP-DD module retails for approximately $400–$600, with costs driven by DSPs, laser diodes, and packaging. High-volume manufacturing and competition among vendors like II-VI, Lumentum, and Innolight have further driven down prices, making pluggable modules the default choice for cost-sensitive deployments. CPO modules, however, command a premium due to their specialized manufacturing requirements. The integrated nature of CPO necessitates custom ASIC-photonics co-design, which incurs non-recurring engineering (NRE) costs of $10–$20 million per design cycle. Additionally, the lack of standardization in CPO packaging—such as variations in fiber attachment methods (edge coupling vs. grating couplers)—limits economies of scale. Early adopters like Amazon Web Services and Google have reported CPO module costs 2–3× higher than equivalent pluggable modules. Despite these upfront costs, CPO offers compelling total cost of ownership (TCO) advantages in hyperscale environments. By r educing power consumption by 30–50%, a 100,000-port data center could save $5–$10 million annually in energy costs alone. Furthermore, the compact form factor of CPO switches reduces real estate requirements, enabling higher port densities and deferred capital investments in facility expansion. Over a 5–7 year operational horizon, these savings can offset the initial premium, particularly in AI/ML workloads where bandwidth demands scale exponentially.
    Conclusion: The rivalry between optical pluggable modules and CPO encapsulates the broader tension between incremental innovation and architectural disruption in data center networking. Pluggable modules remain the pragmatic choice for most enterprises, offering a proven, cost-effective solution with broad interoperability. However, as AI-driven workloads push the boundaries of throughput and energy efficiency, CPO emerges as the inevitable successor for hyperscale and high-performance computing environments. Industry collaboration will be critical to overcoming CPO’s manufacturing and standardization challenges. Initiatives like the Consortium for On-Board Optics (COBO) and the Open Compute Project (OCP) are already fostering cross-industry partnerships to establish common interfaces and testing protocols. Meanwhile, advancements in silicon photonics and 3D packaging promise to further reduce CPO costs, narrowing the gap with pluggable modules.In the near term, hybrid architectures—combining CPO for spine-leaf interconnects and pluggable modules for edge connectivity—may offer a transitional path. Ultimately, the choice between these technologies will depend on specific operational priorities: pluggable modules for flexibility and cost, CPO for scalability and efficiency. As the industry marches toward 1.6T and 3.2T Ethernet, the co-packaged optic revolution is no longer a question of “if” but “when.”
   

Coming… Comparison of two main CPO architectures, Intel Vs NVIDIA