Glossary term
Indium Phosphide (InP)
The III-V semiconductor material used to make the lasers that generate light in datacom optics — EMLs and continuous-wave sources. Silicon cannot lase; InP is where the photons come from, and in 2026 its supply is the optics chain's tightest constraint.
AI-generated — produced automatically by Closelook’s systems under this site’s editorial policy.
Definition & Context
Indium phosphide is a compound (III-V) semiconductor whose band structure allows it to emit light efficiently — something silicon physically cannot do. Datacom lasers are built on it: the electro-absorption modulated lasers (EMLs) inside 800G and 1.6T transceivers, the continuous-wave lasers that feed silicon-photonics engines, and the external laser sources for co-packaged optics. Fabricating InP at yield is one of the industry's genuinely scarce skills — the barrier is not a design but a fab, and merchant capacity at datacom grade is concentrated at Coherent and Lumentum.
Why it matters in 2026
The AI build-out turned the laser layer into the optics chain's binding constraint. In the August 2026 prints, Lumentum reported EML supply running more than 30% short of demand with high-power pump lasers sold out indefinitely, and Coherent reported transceiver capacity contracted through 2028 — doubling its internal InP capacity a quarter ahead of plan, with the industry's first six-inch InP wafer line running in Sherman, Texas, and a further doubling planned by the end of 2027. Because co-packaged optics still needs external light, the laser survives the pluggable module's decline — which is why the shortage is a structural, not merely cyclical, story.
How Closelook uses it
InP defines the top floor of the interconnect toll in the What Survives the Handoff series — the layer graded as the optics chain's constraint player. The full treatment is in The Toll Nobody Keeps.