Near-Packaged Optics Gains Momentum as Co-Packaged Optics Faces 2029 Mass Production Delays; Open CPX MSA Advances Interoperability

Tom’s Hardware / XenoSpectrum USA

Overview

Near-Packaged Optics (NPO) is rapidly emerging as an interim solution for AI data center optical interconnects, as Co-Packaged Optics (CPO) mass production is now projected to delay until 2029. The Open CPX MSA, established at OFC 2026, aims to standardize socketed optical engine interfaces covering both NPO and CPO. Major players like Broadcom are releasing 3.2T VCSEL-based NPO products, while NVIDIA’s Quantum-X Photonics InfiniBand switch also exhibits NPO characteristics, bridging the gap until CPO’s widespread adoption. This shift offers a more flexible and immediate pathway to address AI infrastructure’s demand for higher bandwidth and lower power consumption, mitigating CPO’s current reliability and supply chain complexities.

In Depth

Key Findings

As Co-Packaged Optics (CPO) faces delays in reaching full mass production until 2029, Near-Packaged Optics (NPO) is gaining significant traction as an interim solution for next-generation optical interconnects in AI data centers. This strategic shift is underscored by the establishment of the “Open CPX MSA” at OFC 2026, an initiative to standardize socketed optical engine interfaces compatible with both NPO and CPO architectures, fostering greater industry alignment and interoperability.

Technical / Clinical Details

• **The Rise of NPO**: CPO, which aims to integrate optical transceivers directly onto processor packages, promises superior performance and power efficiency. However, it currently grapples with significant challenges related to technological maturity, reliability in high-volume manufacturing, cost, and supply chain complexity. NPO, in contrast, positions the optical engine “near” the chip within the package but often utilizes detachable external laser modules. This design provides a pragmatic approach, mitigating CPO’s inherent risks by offering greater flexibility in deployment and simpler supply chain management.
• **Industry Leaders’ Approaches**:
  • **Broadcom**: At OFC 2026, Broadcom unveiled a 3.2T VCSEL-based NPO product, signaling a clear commitment to NPO solutions. Concurrently, the company continues to advance CPO, with its 51.2T Bailly CPO switch already in mass production and the 102.4T Tomahawk 6 Davisson having shipped since October 2025, demonstrating parallel progress in both integration strategies.
  • **NVIDIA**: The Quantum-X Photonics InfiniBand switch, despite being labeled CPO by NVIDIA, incorporates silicon photonics engines with detachable external laser modules—a design characteristic closer to NPO. This approach highlights a practical, deployable solution that addresses immediate needs without fully committing to the most extreme CPO integration.
  • **Meta**: The social media giant presented crucial findings on CPO reliability, emphasizing the long-term operational challenges and demanding requirements for CPO deployment within hyperscale data centers.
• **Standardization Efforts**: The formation of the Open CPX MSA is a critical step towards establishing common standards for NPO and CPO interfaces. This initiative seeks to ensure interoperability across various vendors and accelerate the broader adoption of these advanced optical interconnect technologies by providing a clear, standardized framework.

Background & Context

The explosive growth of AI/ML workloads has drastically increased data transfer volumes within data centers. Traditional electrical interconnects are rapidly approaching their limits in terms of power consumption, latency, and reach. The transition to optical interconnects is therefore imperative. While CPO represents the ultimate vision for this transition, its inherent complexity necessitates a gradual adoption curve. NPO serves as a vital bridge technology, addressing the immediate market demand for enhanced optical connectivity while allowing the industry to mature CPO manufacturing and reliability processes.

Strategic Significance & Outlook

The ascendancy of NPO acts as a crucial enabler for AI data center evolution, providing a viable path forward until the technical hurdles of CPO are fully resolved. Through standardization efforts like the Open CPX MSA, the industry aims to establish seamless migration pathways between NPO and CPO, ultimately moving towards more tightly integrated CPO solutions. NPO deployments will also contribute invaluable experience and help optimize the supply chain, paving the way for CPO’s anticipated mass production ramp-up from 2029 onwards. This measured, two-pronged approach ensures continuous innovation and scalability for AI infrastructure.

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