A very good read:
http://semiengineering.com/silicon-photonics-comes-into-focus/
"But there are a number of technical and business-related challenges that must be resolved to really propel this technology forward. Light sources based on materials such as gallium arsenide, indium arsenide (InAs) or indium gallium arsenide (InGaAs) need to be more tightly coupled into the manufacturing process to achieve economies of scale, which has been problematic in the past because these III-V materials are difficult to work with using conventional silicon processes."