This paper explains and demonstrates the unique properties of micron-size silicon-on-insulator (SOI) waveguides. It gives an overview of the silicon photonics research at VTT, as well as latest R&D highlights. The benefits of high mode confinement in rib and strip waveguides are described, reaching from low losses and small footprint to polarization independent operation and ultra-wide wavelength range from 1.2 to over 4 μm. Most of the results are from photonic integrated circuits (PICs) on 3 μm SOI, while a 25 Gbps link with a transceiver on 12 μm SOI is also reported. Wavelength multiplexing and filtering is demonstrated with some breakthrough performance in both echelle gratings and arrayed waveguide gratings. Lowest losses are below 1 dB and lowest cross-talk is below -35 dB. Progress towards monolithically integrated, broadband isolators is described, involving polarization splitters, reciprocal polarization rotators and nonreciprocal Faraday rotation in 3 μm SOI waveguide spirals. Quick update is presented about switches, modulators and Ge photodiodes up to 15 GHz bandwidth. Hybrid integration of lasers, modulators and photodiodes is also reported. The added value of trimmed SOI wafers and cavity-SOI wafers in Si photonics processing is addressed. Latest results also include up-reflecting mirrors with <0.5 dB loss, which support wafer-level testing and packaging.