NTT DATA, Broadcom forge optical chips to slash AI power use
TOKYO, JAPAN, and CALIFORNIA, UNITED STATES — A major international consortium led by Japan’s NTT DATA is partnering with United States chipmaker Broadcom to develop a new generation of optical semiconductors.
Telecom Review Asia reports that the technology, slated for market release next year, aims to cut data center energy consumption by up to half, addressing the soaring electricity demands of generative artificial intelligence.
Optical technology as an energy efficiency breakthrough
The main innovation driving this cooperation is the substitution of traditional electrical wiring with light-based communication in semiconductor packages. This is the basis of NTT DATA’s Innovative Optical and Wireless Network (IOWN) project, which aims to create a next-generation information infrastructure.
The technology will also harness the optical signals to greatly increase the speed and capacity of computer processors, besides enhancing their energy efficiency.
This is a direct response to the high power demands of sophisticated AI systems. The consortium aims to reduce data center power consumption by up to half, a vital objective given the skyrocketing power requirements driven by GenAI.
Integrating optical interconnects directly into semiconductors aims to deliver processors that handle these intensive AI computations both faster and more efficiently, merging high performance with sustainability.
Strategic alliance for sustainable AI infrastructure
NTT DATA, a global IT and business services provider from consulting to managed services, with a pronounced focus on integrating data and AI into client solutions. Generating $30 billion in annual revenue, the company is leveraging its vast resources and expertise to help clients navigate the current dynamic era, enhancing their competitiveness by embedding transformative technologies, such as generative AI, into their operations.
The company also ranked #24 in the OA500 2025, an objective index of the world’s top 500 outsourcing companies.
Meanwhile, Broadcom has strategically consolidated industry service providers to create a behemoth with the engineering depth and product diversity to lead in category-defining semiconductor and infrastructure software solutions.
This operational focus allows Broadcom to deliver the foundational technologies upon which its global customers—and indeed, service providers like NTT DATA—build and grow their businesses in an ever-evolving digital landscape.
The alliance between NTT DATA and Broadcom is a strategic step towards positioning the companies at the center of the global effort towards sustainable computing.
The combination of NTT DATA, which covers telecommunications capabilities and its IOWN program, with Broadcom’s semiconductor strengths gives the alliance immense potential to address one of the bottlenecks in AI development.
This joint effort is essential to commercialize the complex optical technology and establish it as a new industry standard.
NTT DATA’s explicit plan to supply the new products to United States firms developing GenAI underscores its ambition to become a critical enabler of the AI ecosystem. The initiative addresses the pressing challenge of balancing rapid AI innovation with environmental responsibility.
As NTT DATA President and Chief Executive Officer (CEO) Shimada Akira stated during a press conference, “What counts most is to help society cut the use of electricity,” framing technological advancement within a broader context of corporate and environmental stewardship.
