Premji Invest is excited to announce our investment in CScale, which is building a new optical interconnect architecture for scale-up networks.
We have been consistently impressed by the depth and breadth of CScale's team, particularly their focus on the hardest problems gating broader adoption of optical interconnects. Martin Lund brings decades of experience building networking silicon and infrastructure at datacenter scale, while Sanjai Kohli has spent his career building communications and computing systems. The broader team spans high-speed electronics, photonics, packaging, and software. That range of experience gives the team the perspective to approach the optical interconnect problem from first principles and design around what it actually takes to deploy these systems commercially.
As datacenters scale, interconnect architects must design for higher throughput and bandwidth density within tighter reliability, power and cost constraints. While scale-out networks have already moved substantially towards optics, scale-up fabrics remain largely electrical. However, as copper reaches its physical limits, optical scale-up will become increasingly necessary to sustain further power and cost improvements in future rack architectures. Unlike copper, fiber offers a vast pool of spectrum allowing more throughput within the same physical footprint.
Our work across the category has led us to a broader conclusion that commercial viability will not be defined by a single component-level innovation alone. This is fundamentally a systems problem, where manufacturability, serviceability, reliability, and system-level operation need to be treated as primary design requirements alongside raw performance.
The industry has historically been undercapitalized, but it has made meaningful progress over the past few years in advancing the capabilities of optical devices. As such, we expect large customers to experiment with a range of approaches, both internally and through external partnerships, before committing meaningful commercial volumes to any one solution. With that in mind, we evaluated the category through a few first-principles checks.
Components must be co-optimized and integrated as a complete system to support the requirements of mass deployment
Several existing approaches in the industry focus on individual components (e.g. faster modulators, higher-powered lasers, or differentiated material systems). But as we worked through the requirements of deployment at scale, we found that preserving component-level advantages can require burdensome tradeoffs elsewhere in the system. For example, a highly performant modulator may compromise packaging yield or thermal stability. A novel, power-efficient light source may introduce crosstalk when densely integrated. A novel material platform may prove difficult to yield at high volumes. Conversely, a disaggregated approach shifts the burden of integration, validation, serviceability, and support to the operator, adding substantial operational overhead and technical complexity.
One architectural path we examined relies on dense arrays of optical resonators such as microring modulators. In isolation, these resonators look attractive because of their compactness and efficiency. The challenge is maintaining stability as these resonators are densely integrated. In this format, thermal crosstalk and wavelength drift become a coupled, system-level control problem, increasing the demands on tuning, calibration, and thermal management. In our view, this may not be the optimal tradeoff for deployment at scale. The key question is whether these architectures can be manufactured at high yields and perform reliably in the field, especially as designs become densely multiplexed and production volumes rise.
The optics industry has learned many of these lessons in past cycles. Technologies can appear compelling in an early demo or at the subsystem level, but become harder to qualify, manufacture, and operate reliably in the field. Our work reinforced that in photonics: strong component-level performance may not be enough to drive commercial adoption.
We saw much of the same thinking in our early conversations with CScale. The team's approach began with the full set of requirements for a scale-up fabric that could actually be deployed and operated at scale. The result is a product that combines proven photonics process know-how with an architecture designed around the practical realities of optical systems, including thermal instability, aging, process variation, and component failure. Manufacturability and serviceability are built into the design from the start. That approach closely matched the conclusions we had reached through our own work and further underscored CScale's differentiation.
Reliability is mission-critical for scaled commercial deployments
Bandwidth, power, and reach tend to dominate discussions around new optical devices. Wethink reliability is just as important, and one of the biggest challenges tosolve for broad adoption of scale-up optics.
At datacenter scale, optical components are inherently difficult to manufacture and operate reliably. Unlike CMOS, optical systems require different materials and components (e.g. lasers, modulators, fibers) to be integrated and precisely aligned across multiple manufacturing steps, many of which can be difficult or impossible to rework. Small alignment errors or wavelength shifts can degrade link performance, while adding more components can compound yield and reliability challenges.
Those challenges do not end at manufacturing. Optical component behavior is sensitive to environmental conditions, and failures can be difficult to isolate or reproduce. As optics moves closer to the compute package, engineers cannot depend on flawless operation of every component. The system must be able to monitor link health, diagnose degradation, and continue operating when individual components fail.
The cost of failure is especially onerous at cluster scale. Low failure rates at the component level can create a substantial operational burden across the enormous number of links in a modern AI cluster. And because these workloads are tightly coupled, a single degraded link can create cascading stalls and significant losses in compute utilization. A clean eye diagram in the lab or a strong component-level reliability result is not enough for commercial viability. What ultimately matters is whether the full system can be relied upon under real operating conditions.
CScale has designed its system with these challenges in mind across the full product lifecycle, from manufacturing and initial deployment through real-time optimization and failure management. The goal is higher cluster availability, simpler operations, and ultimately more confidence for engineers to scale beyond the limits of legacy interconnect.
Spectrum is abundant
At a high level, the throughput of an optical link depends on two things: how much spectrum is used and how many bits are transmitted through each unit of spectrum. The industry has made strong progress in advancing spectral efficiency, and in datacenter optics, these gains can help address the density constraints imposed by limited package perimeter and shoreline availability. However, we believe that overly relying on higher symbol rates and more complex modulation may be the wrong approach for short-reach scale-up. Accordingly, we see potential in product roadmaps which can more effectively exploit the vast spectral headroom provided by optical fiber within the packaging and power constraints of the system.
In a medium with abundant spectrum, maximizing bits per second per hertz should not necessarily be the primary goal. Denser modulation or higher symbol rate scan make signals more fragile, consume more power, demand heavier error correction, and reduce tolerance for thermal drift, crosstalk, manufacturing variation, or loss. In short, higher-throughput lanes do not necessarily result in a more robust system. One logical alternative is to use more of the available optical spectrum while keeping each channel simpler and easier to manage. The opportunity is to trade abundant spectrum for better signal integrity, lower latency, and greater operating margin.
Ultimately, CScale's technical depth and systems design judgment were central to our conviction. As optics moves into the scale-up fabric, we believe commercial viability will depend increasingly on building reliable, well-optimized systems, not just higher-performing components. We are excited to partner with CScale as the team builds for that future.
