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The vehicle will target startups across North America, Asia, and Europe to accelerate the commercial ecosystem for all-photonics networks
Japan’s largest telco, NTT, is preparing to create an investment fund worth roughly $500 million to support the Innovative Optical and Wireless Network (IOWN) initiative and related AI development, according to reports from Yomiuri Shimbun.
South Korea’s SK Group, Taiwan’s Chunghwa Telecom, and the Development Bank of Japan are reportedly partners in the ‘IOWN AI Fund’.
More than 10 additional Japanese corporations – spanning tech giants like Toshiba, Sony, and Fujitsu, alongside major financial institutions including MUFG, SMBC, and Mizuho – have also expressed intent to participate.
The ‘IOWN AI Fund’, which will be set up by the end of the month, aims to expand IOWN’s growing ecosystem and the AI infrastructure supporting it. This will be achieved by targeting tech startups across North America, Asia, and Europe, focusing on photoelectric fusion, AI semiconductors, and the development of next-generation, IOWN-native AI models.
The concept of IOWN was introduced by NTT in 2019, with the central premise of shifting telco network topology from electronics to photonics (i.e., data transmission via light rather than electricity).
Currently, typical backbone networks carry optical signals over fibre but are forced to convert these photonic signals into electrical signals for processing. IOWN envisions an end-to-end optical network that would remove this translational bottleneck, delivering major benefits like lower power consumption, higher speeds, and larger capacity.
As generative AI data centres place unprecedented strain on global energy grids, it should be no surprise that the IOWN initiative is gaining momentum.
Indeed, IOWN is already beginning to show signs of moving from technical R&D to commercial scaling. In 2024 deployment by NTT and Chunghwa Telecom successfully activated a 3,000km subsea IOWN link between Japan and Taiwan, achieving a one-way latency of just 17 milliseconds.
By leveraging a formidable cross-border alliance of East Asian telecom, semiconductor, and financial giants, the IOWN AI fund is betting all-photonic network architecture will be a major alternative to traditional network strategy in the not-so-distant future.
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