This is a great explaination of how the optical microchips work... from Intel..
The optical microchips that Intel is researching are made from silicon – just like conventional microchips. This offers the advantage of being able to use existing production systems and expertise spanning four decades in their manufacture. Furthermore, silicon is a practically inexhaustible resource. After oxygen, it is the next most common element on the Earth, and can be obtained from quartz sand.
An optical microchip functions in a similar way to a conventional chip, except that its conductor paths are not made from metal, and that data is not transferred in the form of electrons. Rather, photons are transported through the silicon in light ducts, referred to as waveguides. To a large extent, an optical microchip is made of three components: a modulator that converts electronic data into light, a laser which acts as a light pump to send the photons through the silicon, and a demodulator that converts the photons back into electronic impulses.
The electronic data is recoded into light pulses in the modulator. Theoretically, this is very straightforward, because digital data only occurs in two states, namely "zero" / "one", or "on" / "off". To put it simply, the modulator operates like a light switch which switches the laser on and off, thereby passing on the digital data in the form of photons. To enable the photons to be transmitted, it is necessary to have a certain type of laser, in this case a Raman laser4iv. Intel has developed a Raman laser composed of silicon and indium phosphide, which will be used on the company's optical microchips. The photons are converted back into electrons by the demodulator, the last missing component of an optical microchip. The demodulator is made up of a silicon core, but has a special germanium coating in order to absorb the light. When the laser pulses strike the demodulator, they are absorbed by the germanium layer, thereby causing electronic pulses to be created. These pulses are passed on to the silicon where they are amplified and can then be processed electrically.
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