Short distance optical interconnects, which has long promised to solve a number of problems assumed to exist in electronic systems, seems to be at the threshold of providing real value to future processing systems. In many cases, it has been the cost of optical interconnects which has prevented their widespread adoption. However, while data rates required in future computing systems are increasing, and fiber optic component costs have decreased, the distances over which optical interconnects become attractive have been shrinking. In addition the increasing demand for smaller footprints for the I/O at the card edge, plays into one of the strong advantages unique to optics. An effort called Optical Micro-Networks is underway, funded by DARPA, whose objective is to demonstrate cost effective system level benefits in parallel optics for intra- and inter-rack interconnects by leveraging recent advances in VCSEL arrays, high sped CMOS, and low cost glass fiber cabling, connectors and on-board fiber routing. The approach will integrate optical interconnect functionality directly into an ASIC package thus reducing size, cost, and power.