Canada Spins Off Photonics Lab

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To no one’s surprise in Canada’s semiconductor industry, the federal government formally announced its intent to spin off the Canadian Photonics Fabrication Center (CPFC) into a commercial entity.

Under the umbrella of the National Research Council in Ottawa, the CPFC is considered North America’s only end-to-end pure play compound semiconductor facility. It was launched in 2005, in the wake of a major telecom bust that included the collapse of Nortel, as a federal effort to rebuild Canada’s photonics and III-V semiconductor manufacturing base.

Operating as a specialized foundry for photonic devices, ICs, and compound semiconductors, the CPFC has become a one-stop shop for III-V semiconductor photonic and IC prototyping, engineering, manufacturing, testing, and process development.

The CPFC operates a 40,000-square-foot facility with 11,000 square feet of cleanroom space. It works with materials such as indium phosphide, gallium arsenide, and gallium nitride, and serves sectors such as fiber-optic networks, defense and aerospace, medical imaging, data centers, and AI infrastructure.

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The announcement was made at the recent CHIPS NORTH Executive Summit evening reception in Kanata, a suburb of Ottawa long associated with Canadian telecom firms past and present that have played a significant role in developing the country’s photonics and compound semiconductor capabilities.

Announcing the spinoff of the Canadian Photonics Fabrication Center as a commercial entity.
Canada Photonics Lab President of the National Research Council of Canada Mitch Davies, Canadian Industry Minister Mélanie Joly, Kanata Member of Parliament Jenna Sudds, and CSC managing director Paul Slaby came together to announce the spinoff of the Canadian Photonics Fabrication Center as a commercial entity. (Source: National Research Council)

Mélanie Joly, Canada’s minister of industry and minister responsible for Canada Economic Development for Quebec Regions, said the federal government expects the CPFC spinoff to attract additional investment, create new jobs, and position the center as a world-leading international hub.

The CPFC spinoff is carried out with sovereignty in mind, Joly said, with the Government of Canada retaining a significant stake. “We have amazing assets here, but we need more capital to scale them.”

She said photonics technology and the CPFC are a central part of Canada’s plan to build up its advanced manufacturing sectors and sovereign capabilities, including in automotive, defense, aerospace, and AI. “We also want to be a strategic partner in the development of semiconductors,” Joly said.

CPFC operates a 40,000-square-foot facility with 11,000 square feet of cleanroom space. It works with materials such as indium phosphide, gallium arsenide, and gallium nitride. (Source: CPFC)

At the CHIPS NORTH Executive Summit the following day, Paul Slaby, managing director of Canada’s Semiconductor Council, said the CPFC spinoff is an indicator that Canada is moving in the right direction toward speed, scale, and a more industry-driven model. “It opens the possibility of something we have been working toward for years—building a more competitive end-to-end supply chain here in Canada, where we are not just participating in global systems, but actually shaping parts of it.”

Mitch Davies, president of the National Research Council of Canada, said the CPFC has anchored the country’s photonics ecosystem for more than two decades and reinforced Canada’s photonic industrial capabilities at a time when it really mattered. “It’s enabled Canadian small and medium-sized enterprises to grow,” he said. “These companies are now positioned to capture generational opportunities in photonics AI and quantum technologies.”

Davies said the National Research Council has a 110-year history in Canada with ups and downs and fluctuating mandates. “It’s not a home for anything certain, but it’s a place to add some challenges and take on risk.”

The formation of the CPFC was a capability rescue, he said, but its spinoff marks the beginning of a new chapter.

Davies said that in the coming months, the National Research Council will work with the Canada Development Investment Corporation to structure a private investment process to engage investors and partners, all to negotiate and execute a CPFC spinoff in a transparent and timely manner. He said transforming the CPFC into a for-profit private corporation unlocks a generational growth opportunity to scale Canada’s photonic manufacturing capabilities. “The CPFC needs greater agility, investment, and expanded capabilities across the supply chain.”

In an interview with EE Times, Gord Harling, CEO of CMC Microsystems, said that freeing the CPFC from the confines of the National Research Council (NRC) will allow it to grow into a much larger organization with much more capacity—an important step both for Canada and for its partners around the world. “The CPFC is the jewel in the crown of the NRC,” he said. “It’s a wonderful thing that they’re being unleashed to grow organically.”

Harling said the CPFC complements other key facilities in Canada, including IBM’s advanced packaging facility in Bromont, Quebec, which is also home to one of Teledyne’s MEMS foundries (it has another facility in Edmonton). “We already have some large things to crow about,” he said.

He also sees a role for CPFC capabilities in supporting CMC’s DUET initiative, which focuses on developing dual-use and emergency services technologies that could be subsequently used for defense applications, such as sensors used to locate people during natural disasters and detect objects underwater. “Eventually, those will be useful for defense, but we want to get people up and running with a product and take it to market.”

The CPFC’s strengths in lasers are of particular interest to FABrIC, a five-year, CDN$223 (~U.S.$163 million) initiative managed by CMC Microsystems and aimed at growing Canada’s semiconductor industry. Harling said. “We want to use some of the funding from the FABrIC program to help them develop new process technologies that we can offer, not just in Canada, but around the world.”

The first round of FABrIC funding was directed at several photonics projects, including one involving CPFC as a collaborator. Ottawa-based Ranovus is developing a Canadian-made external laser source (ELS) designed to power the next generation of AI data centers. The ELS is a critical component for co-packaged optics (CPO), which dramatically improves the power efficiency, speed, and reliability of the systems that train and run complex AI applications.

The CPFC manufactures Ranovus-designed lasers; wafers manufactured at the CPFC are sent to Europe to be diced into bars, coated, and then thinned, tested, and brought back to Ranovus to complete the rest of the production.

Lasers such as those used in LiDAR systems have many applications, including automotive, aerospace, and off-Earth for accelerometers with no moving parts. “There are so many places that the photonics from the CPFC can go,” Harling said.

The latest round of FABrIC funding includes support for two photonics-focused projects led by companies in Quebec City. Indie Photonics Canada is developing semiconductor lasers for oceanic fiber optic sensing, a technology used to monitor seismic activity, environmental conditions, and the health of underwater telecommunications infrastructure. Meanwhile, WhalePiX is developing scalable photonic chiplets for far-reach AI optical connectivity that supports multi-terabit data transmission.

Canada Spins Off Photonics Lab

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