gthuang88 writes: Exploding demand for data centers at Google, Facebook, and other Web giants is driving investment in optical communications hardware. Ayar Labs, a startup with roots at MIT, has raised money from venture fund FF Science, co-led by Peter Thiel, to commercialize a new kind of optical chip that could increase bandwidth and reduce energy consumption in data centers. Meanwhile, Acacia Communications, one of the few tech companies to IPO in 2016, is making a profit on silicon-based optical interconnects for data centers and telecom applications. After more than a decade of basic research, silicon photonics seems to have found a market niche. Intel, IBM, and others with big efforts in the field are taking notice.