The vision of higher profits and fewer manpower is pushing American companies towards the embrace of generative artificial intelligence. If used properly and served by high-performance, high-capacity networks, generative artificial intelligence is expected to bring innovation and significant productivity improvements.
In 2024, optical network suppliers will consider these network requirements. Light Reading stated that to their knowledge, Ciena’s annual report may have been written by ChatGPT, stating that “in the foreseeable future, generative artificial intelligence may be an important stimulus or accelerator for network demand both inside and outside data centers.”
Artificial intelligence reshapes data centers
Ian Redpath, Director of Transmission Network and Device Research at Omdia, stated: “Omdia has seen a strong interest in cloud services among all major vertical enterprises, and we believe that their interest will extend to the field of artificial intelligence to help develop their business models. Google Cloud has coined the term ‘ultra large scale infrastructure’ to describe their vision for the next generation of infrastructure they need. Omdia has started tracking the turning points towards an interconnected environment for ultra large scale data centers.”
Sameh Boujelbene, Vice President of Dell’Oro Group, agrees with this. She said, “We expect 2024 to be an important year for the deployment of 800Gbit/s in data centers, as we expect several large cloud service providers to quickly adopt the second wave of 800Gbit/s (based on 51.2Tbit/s chips).”
She pointed out that from 2022 to 2023, the first wave of 800G data center connectivity (based on a 25.6Tbit/s chip) was mainly driven by a major cloud provider. She predicts that “by the end of 2023, its adoption speed will accelerate, laying the foundation for accelerated development next year.” Boujelbene stated in her research that by 2025, almost all switch ports in artificial intelligence backend networks will reach 800Gbit/s or faster.
A lot of news in 2023 was about the launch of new coherent DSPs and higher wavelength speeds. Jimmy Yu, Vice President of Dell’Oro Group, predicts that sales of these products will increase in 2024: “I can imagine that optical manufacturers and operators will release a lot of announcements about deploying 1.2Tbps and 1.6Tbps coherent DWDM. We should also see more news about large-scale enterprises adopting 800ZR QSFP-DD.”

Will artificial intelligence sweep across wide area networks (WANs)?
In fact, the driving force behind deploying generative artificial intelligence and tapping into its full potential will be one of the many factors driving the rapid development of short distance data center links, and more complex pluggable coherent modules will make all of this possible. All of this happens within the data center. What about outside?
Sterling Perrin, Senior Chief Analyst at Heavy Reading, said, “In the field of wide area networks, I believe it is still too early to determine to what extent artificial intelligence hype will translate into sales of DCI optical products in 2024 or beyond. I believe everyone will discuss this issue, but I believe there are too many unknown factors at the moment.”
The supply chain has calmed down
Yu also believes that 2024 may be the year when we finally get rid of the inventory dilemma that has plagued the industry since the onset of COVID-19. He said, “I believe that 2024 will usher in a new chapter where shipments will align with service provider demand. The backlog has now returned to normal levels, and the number of new orders is increasing. In other words, the impact of the supply chain crisis has officially passed.”
Pluggable optics (entering edge, RAN, and more fields)
Last year, we believed that pluggable optical devices would begin to appear anywhere – and they did, and not just there. Perrin from Heavy Reading stated that coherent pluggable optics will continue to penetrate the telecommunications industry in 2024.
Perrin said, “100G QSFP28 coherent pluggable devices are about to be commercialized. These new pluggable devices open up a new opportunity for coherent optics at the edge of service providers. Coherent 100G pluggable devices will also be closely related to advanced” multi host “optics.”. Switches and routers are the most prominent use cases today (i.e. IP over DWDM). However, coherent optics at the edges have introduced new host devices, including PON OLT, RAN components, and servers. It will be interesting to observe how the edge coherent optics market is taking shape this year