AI data center scaling is not only about adding more GPUs or increasing switch port speed. As AI training, inference, model fine-tuning, and multi-rack cluster deployments expand, the physical interconnect layer becomes a key part of network performance and long-term scalability.

Servers, GPU/XPU nodes, switches, and storage systems generate heavy east-west traffic. The interconnect choice affects link distance, power consumption, cabling density, thermal design, maintenance, and future expansion. In real deployments, DAC, AOC, and optical transceivers are often used together rather than treated as direct substitutes.

The practical question is not which option is universally better. It is how to match the right interconnect to the rack layout, network topology, port speed, and upgrade plan.

Why AI Data Centers Need Layered Interconnect Planning

AI cluster networks contain multiple link types. A short server-to-ToR connection inside one rack has different requirements from a cross-rack, leaf-spine, or data center interconnect link.

In-rack links usually focus on cost, power, and deployment simplicity. Rack-to-rack links require better cable management and stable high-speed transmission. Cross-row, core switching, or DCI links usually need structured fiber cabling and optical modules that support longer reach and future upgrades.

For this reason, AI data center interconnect planning should evaluate:

• Link distance and rack layout;
• Port speed and form factor;
• Power consumption and thermal budget;
• Cabling density and airflow;
• Switch and NIC compatibility;
• Maintenance and replacement model;
• Future expansion and upgrade path.

DAC, AOC, and optical transceivers each have a clear position within this layered design.

Where DAC Still Makes Sense in AI Data Centers

DAC is mainly used for short-reach server-to-switch links where cost, power consumption, and deployment simplicity matter more than cabling flexibility.

For in-rack connections, passive DAC can be a practical choice because the distance is short and the link structure is usually fixed. It helps reduce module power and total connection cost, especially when many server-to-ToR links are deployed in a dense rack.

However, DAC also has clear boundaries. As link speed increases, signal integrity becomes more challenging. The cable is also thicker and less flexible than optical fiber, which can affect cabling density, bend radius, and airflow in high-density AI racks.

DAC is generally suitable when:

• The link distance is short;
• The connection is mostly fixed;
• Low power and low cost are priorities;
• Cable thickness and routing are still manageable;
• The deployment is mainly server-to-ToR or in-rack switching.

Once the network expands beyond the rack or requires more flexible cabling, AOC or optical transceivers usually become more practical.

Where AOC Fits Better Than Copper Cabling

AOC is a useful option when the link distance exceeds the practical range of DAC, but the deployment still benefits from an integrated cable assembly.

Compared with copper cabling, AOC is lighter and easier to route in high-density environments. It can support longer rack-to-rack connections while keeping installation relatively simple because the optical engines and fiber cable are integrated into one assembly.

This makes AOC suitable for fixed or semi-fixed links where deployment efficiency is important. It is often considered for adjacent racks, cross-rack links, and high-density server or switch environments where copper cable weight and stiffness become constraints.

The trade-off is maintenance flexibility. Since the cable and optical ends are integrated, a fault normally requires replacing the entire assembly. Inventory management can also become more complex when multiple lengths are needed.

AOC is generally suitable when:

• The link distance is longer than typical short copper connections;
• Cable weight and routing flexibility are important;
• The link is fixed or changes infrequently;
• Simple deployment is preferred over modular maintenance;
• High-density rack-to-rack cabling is required.

Where Optical Transceivers Provide More Flexibility

Optical transceivers are better suited for structured fiber cabling, longer reach, and network layers that require easier maintenance or future upgrade capability.

Unlike AOC, the optical module and fiber cable are separate. This allows the same transceiver family to be used with different fiber infrastructure, and it allows modules and patch cords to be maintained independently. For cross-rack, cross-row, leaf-spine, core switching, and DCI links, this modularity is often more valuable than the lower initial cost of a fixed cable assembly.

Optical transceiver selection usually depends on reach, fiber type, connector, wavelength architecture, form factor, and switch platform. Common options may include SR, DR, FR, LR, and longer-reach solutions, with form factors such as SFP, QSFP28, QSFP-DD, and OSFP depending on the network generation.

Optical transceivers are generally suitable when:

• The network uses structured fiber cabling;
• The link distance varies across racks, rows, or rooms;
• Independent module and fiber maintenance is required;
• The network may need future speed upgrades;
• Leaf-spine, core switching, or DCI links are involved.

For large AI clusters, optical transceivers are often the foundation for the scalable network layer because they support clearer cabling architecture and more predictable upgrade planning.

DAC vs AOC vs Optical Transceivers: Engineering Comparison

The comparison is not a fixed rule. It is a starting point for engineering selection. The final choice should consider switch platform, port speed, cable route, airflow, maintenance model, and expected cluster growth.

Selecting Interconnects by Deployment Distance

In practical AI data center design, link distance often defines the first selection boundary.

For fixed short links, DAC can be efficient. For high-density rack-to-rack deployment, AOC can reduce cable weight and simplify installation. For leaf-spine and larger cluster networks, optical transceivers provide the flexibility required for structured cabling and staged upgrades.

Training vs Inference Clusters: Different Connectivity Priorities

AI training and AI inference clusters do not always prioritize the same interconnect characteristics.

Training clusters usually generate intensive node-to-node communication. During distributed training, GPUs frequently exchange gradients, parameters, and intermediate results. Link stability, predictable throughput, congestion behavior, and low-latency communication have a direct impact on cluster efficiency.

Inference clusters may place more emphasis on service stability, cost control, horizontal scaling, and integration with existing data center infrastructure. The network may still require high bandwidth, but the traffic model is often different from large-scale training.

This difference affects interconnect planning. Training clusters may rely more heavily on structured optical links at the leaf-spine layer, while inference clusters may use a mixed approach across DAC, AOC, and optical transceivers depending on link distance and expansion stage.

Why Lowest Initial Cost Is Not Always the Best Choice

In AI data center projects, the lowest initial cable cost does not always lead to the lowest total cost.

An unsuitable interconnect choice may create hidden costs later, including limited reach, difficult cable management, airflow issues in dense racks, restricted expansion, longer troubleshooting time, and higher replacement cost during network changes.

DAC has a clear cost advantage for short fixed links. AOC is useful when medium-short distance and lighter cabling are required. Optical transceivers are often the better long-term foundation for networks that need structured cabling, flexible reach, and future upgrades.

The right design is usually a mixed interconnect strategy instead of a single product type across the whole data center.

ETERN Optoelectronics Interconnect Solutions for AI Data Centers

ETERN Optoelectronics provides high-speed optical interconnect products for data center, AI cluster, and high-performance network applications, including optical transceivers, AOC, DAC, and related fiber connectivity products.

For different AI data center deployment requirements, ETERN supports:

• Short-reach in-rack connections;
• Rack-to-rack and cross-rack interconnects;
• Leaf-spine network connectivity;
• High-density data center cabling;
• 100G, 400G, 800G, and higher-speed network upgrades;
• OSFP, QSFP-DD, QSFP28, and other form factor requirements;
• Mixed AOC, DAC, and optical transceiver deployment strategies.

Interconnect selection should be evaluated together with network architecture, link distance, port speed, power budget, cabling density, and future expansion plans.