Deep dive: The Netherlands has a complete ecosystem for energy-efficient photonic chips

The Netherlands has a strong and integrated ecosystem for photonic integrated circuits (PICs). The demand for 'light chips' is expected to grow rapidly towards 2040, partly driven by data and AI. This is revealed by a market study conducted by Roland Berger commissioned by Invest-NL. The deep dive aimed to better understand where the opportunities lie and what is needed to strengthen the Dutch ecosystem.

Energy-efficient Data Communication

Integrated photonics, also known as photonic integrated circuits (PICs), uses light instead of electrons for data transport. This enables applications that are faster and more energy-efficient, with high precision. This is crucial for applications in strategically important sectors for Europe such as data centers and telecommunications, automotive, healthcare, and defense.

The demand for photonics chips is growing explosively, especially due to the rapid rise of AI and large data centers. Worldwide, there is increasing need for faster and more energy-efficient technology. Integrated photonics makes that possible.

The deep dive outlines the most important integrated photonics platforms for the Netherlands (InP and SiN), their key applications, the expected demand, and the international landscape. The scope of the study is limited to PICs and does not cover individual photonic components.

Netherlands as a one-stop shop in deep tech

The study shows that the Netherlands is internationally distinctive because its ecosystem encompasses the entire value chain: design, production, integration, and application development. Players such as PhotonDelta, SMART Photonics, Holst Centre, LioniX, and Phix, together with many design and application companies, provide a foundation for innovations to move faster from lab to market. New initiatives to increase production capacity further strengthen that position.

"The strength of the Netherlands lies in the fact that we already have many links in place," says Frits de Vries, senior investment manager at Invest-NL. "By connecting these parties, we can scale up more quickly, and at the same time build a stronger European supply chain."

European autonomy requires local production

Europe is expected to represent 15% to 20% of the future global demand for PICs but remains heavily dependent on production outside Europe. Localisation of the supply chain is therefore becoming increasingly important, both for supply security and strategic competitiveness.

Invest-NL continues to connect partners within the ecosystem so that the Netherlands and Europe can seize this growth opportunity in deep tech.