Why did Microsoft just buy the fiber optic cable company Lumenisity?

Major cloud providers and hyperscalers do everything they can to secure technical advantages over their rivals, and last week Microsoft made exactly that move by acquiring fiber optic cable manufacturer Lumenisity.

Acquiring a cable manufacturer is obviously less advantageous than AWS creating its own Arm CPUs or Google's Tensor Processing Unit.

The acquisition of Lumenisity is related to reducing latency, a problem that the acquired company addresses with fiber optic cables hollow core (HCF) that can reduce the time needed to move data between cloud data centers.

Separated from the University of Southampton's Centre for Optoelectronics Research in 2017, Lumenisity's HCF cables are designed to carry laser light using air instead of the silica glass used in something like Cornings SMF-28.
While we think of the speed of light as fixed, it can vary depending on the medium it travels through. For reference, light travels through fiberglass at approximately 200 million meters per second compared to 300 million meters per second through air. According to Lumenisity, this means light travels about 47 percent faster through high-carbon fiberglass (HCF) than through silica fiberglass.

Dell'Oro analyst Jimmy Yu told The Register that it's important because it helps improve network performance. "I can extend my reach for the same amount of latency, or I can reduce the time altogether," he said.

To this end, Lumenisity says its cables can maintain the same latency at 90 kilometers as a glass fiber at 60 kilometers.

And while modern fiber optic cables are incredibly precise, irregularities in the glass and cable coating can cause losses that require expensive, latency-inducing amplifiers or repeaters to correct. If Lumenisity's technology helps Microsoft achieve the ultra-low loss HCF over long distances that the software giant hopes for, Yu believes the savings associated with eliminating or using fewer repeaters would be significant.

Although the fiber optics It is used for everything from connecting individual servers to switches, zones to zones and regions to regions; the latency incurred by fiber optic cables only tends to make a significant difference over longer geographical distances.

As such, Microsoft's interest in HCF cables is likely focused on data center interconnection (DCI).