Tosoh Enters Data Center Market with Low-Cost Plastic Optical Fiber, Targeting 2029 Mass Production

Tosoh is entering the data center optical cable market, aiming for 2029 mass production of a new plastic optical fiber (GI-POF) that promises dramatic cost reduction and higher data density.

This move is driven by soaring AI-related capital expenditures from hyperscalers like Meta and Microsoft, creating urgent demand for more cost-effective, high-bandwidth wiring solutions.

The GI-POF technology is timed to align with the industry's shift to 1.6T Ethernet, offering a solution to the manufacturing complexity and high costs of traditional glass optical fibers.

Japanese chemical company Tosoh has announced its entry into the data center optical cable market, a move poised to address a critical bottleneck in the AI infrastructure boom.

Tosoh is betting on a new type of plastic optical fiber called GI-POF, developed with Keio University, and plans to start mass production by 2029. This isn't just any cable; it promises to be a game-changer. The technology allows for a unique “co-extrusion” manufacturing process that bundles many data-carrying cores into a single fiber, drastically simplifying production compared to bundling many fragile glass fibers. The result? A potential cost reduction of 90% to 99% and a massive increase in data density. A single cable demonstrated by Keio can carry about 6.48 Terabits per second (Tbps), a capacity that would require over 140 traditional glass fibers.

The timing of this decision is no coincidence and is driven by a perfect storm of factors.

First, the AI spending spree. Tech giants, or hyperscalers, are pouring unprecedented amounts of money into AI infrastructure. In early 2026, Meta raised its capital expenditure (CapEx) forecast to $125-145 billion, and Microsoft announced a staggering $190 billion plan, explicitly noting that $25 billion of that was due to rising component costs. This intense spending and cost inflation created an urgent need for cheaper, more efficient components, especially for the short-distance wiring that connects thousands of chips inside data centers.

Second, a technology transition. The data center industry is in the middle of an upgrade cycle, moving from 800 Gigabits per second (Gbps) technology to 1.6 Terabits per second (Tbps). The new standard for this, IEEE P802.3dj, is expected to be finalized in 2026. This transition opens a window of opportunity for new technologies like GI-POF to be designed into the next generation of data centers, replacing older, more cumbersome solutions.

Finally, a supportive domestic ecosystem. In Japan, initiatives like NTT's IOWN global forum are creating a commercial foundation for homegrown photonics technologies. This provides Tosoh with a supportive environment and potential synergies for its mass production plans.

In essence, Tosoh's move is a strategic response to the clear and growing pains of the AI revolution: the need for more data, faster, and at a lower cost. By leveraging innovative Japanese technology, the company is positioning itself to solve a key wiring problem that could otherwise slow down the expansion of AI.

Glossary -
GI-POF (Graded-Index Plastic Optical Fiber): A type of plastic optical fiber that can transmit data at high speeds over short distances, offering flexibility and lower manufacturing costs compared to glass fiber.
Hyperscaler: A large-scale cloud service provider, such as Google, Amazon, Microsoft, or Meta, that operates massive data centers and dominates the cloud infrastructure market.
CapEx (Capital Expenditure): Funds used by a company to acquire, upgrade, and maintain physical assets such as property, plants, buildings, technology, or equipment.