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The chipset can move data at 160Gbits by representing information as light pulses instead of electrons and could be used for both corporate and consumer applications as soon as 2010, IBM said.

Consumer demand for digital media such as movies, music and photos has caused an explosion in the amount of data being transferred over the Internet, and underlined the need for greater bandwidth and connectivity, said T.C. Chen, vice president for science and technology at IBM Research, in a statement.

IBM says it can meet that need, building its new chipset by making an optical transceiver with standard CMOS (complementary metal oxide semiconductor) technology, and combining that with optical components crafted from exotic materials such as indium phosphide and gallium arsenide. The resulting package is just 3.25 mm by 5.25 mm in size, small enough to be integrated onto a printed circuit board.

Although all those technologies exist today, it will probably be at least three years until suppliers can produce enough parts for IBM to bring optical transceivers into its product stream, the company said.

When it does arrive, the part could have an immediate impact on applications from computing to communications and entertainment. A PC using that board would be able to reduce the download time of a typical high-definition feature-length movie from 30 minutes to one second, the company said.