Why Alibaba’s DAC Strategy Revolutionized Data Center Networking

Introduction to DAC in Data Centers

Direct Attach Cable (DAC) is a high‑speed copper interconnect widely used for short‑distance links between IT equipment such as servers, storage, and switches. It serves as the "first segment" of the high‑speed physical network in data centers.

DAC vs. AOC: Technical Differences

Both DAC and Active Optical Cable (AOC) use standard SFP/QSFP interfaces, but AOC contains active optical components (laser, CDR, retimer) while DAC is a passive copper twin‑ax cable that transmits electrical signals directly.

Advantages of DAC

Cost Efficiency: A 25 G DAC costs roughly one‑fifth of an equivalent AOC.

Power Savings: DAC is zero‑power (passive), whereas a 25 G AOC consumes about 1–2 W per cable.

Reliability and Latency: DAC offers higher reliability, lower latency (no optical CDR delay), and better suitability for immersion cooling.

Historical Barriers to DAC Adoption in China

Before 2019, two main issues limited DAC use:

Operational challenges with “black‑box” switches that lacked end‑to‑end debugging, making AOC the safer choice.

Length limitations: DAC could not exceed 7 m at 10 Gbps, 5 m at 25 Gbps, etc., whereas AOC could reach 30–100 m.

Alibaba’s Self‑Developed DAC and White‑Box Switches

Starting in 2018, Alibaba built its own DAC and white‑box switches, designing the hardware to keep port loss low and using fixed equalization parameters, eliminating the need for link‑training and enabling stable, large‑scale deployment.

Key innovations include:

Placing TOR switches in the middle of the cabinet (MOR), reducing cable lengths to ≤2 m.

Redesigning cabinets to shorten cross‑cabinet runs to 2.5 m, supporting 56 G‑PAM4 and future 112 G‑PAM4.

Standardizing DAC lengths from 0.75 m to 2.5 m in 0.25 m steps, simplifying integration and reducing bend‑induced signal loss.

Using nylon‑woven jackets instead of PVC for better flexibility and durability.

Scale‑Up Results

By 2020, Alibaba’s data centers had deployed over one million DACs, achieving:

Annual OPEX savings >10 million kWh.

CAPEX savings >100 million CNY for every million 25 G DACs.

These savings stem from lower power draw, elimination of optical module monitoring, and streamlined operations.

Impact on Network Architecture and Performance

Massive DAC deployment enabled:

Loose coupling between business workloads and network upgrades, allowing rapid bandwidth scaling.

Improved stability and reduced latency, crucial for AI training and latency‑sensitive services.

Energy efficiency gains that become significant at million‑cable scale.

Future Challenges and Prospects

As single‑channel speeds approach 224 Gbps, DAC faces two main challenges:

Shortening viable cable lengths due to higher loss per meter.

Increasing cable diameter as channel count scales, making routing harder.