Co-packaged Optics | A Scalable, Detachable Optical Connection 

All they are doing is stealing ideas from telecom. They did this back in 2000s

I am totally guessing here, it would reduce the number of cycles which external circuit will be using for conversion, error checking and then storing it in its local memory.

0:39 PIC or Photonic integrated circuits do this job. EIC or Electronic integrated circuits are co-packaged with PIC on the same interposer. Alternatively, both EIC's and PIC's could be fabricated on the same silicon die eliminating the need for an additional interposer. BW density, IO density, interconnect density and form factor determines the appropriate configuration.

The PIC you see converts from optical to electrical. Bandwidth could be improved by orders of magnitude.

I doubt it. I am definitely no expert though, but internet latency is measured in milliseconds which is a long, long time even to "slow" copper connections. If we're talking about gaming performance, that's quite small bandwidth too, so "slow" copper connections aren't really the bottleneck of concern for such small bandwidth. Something like this more about shaving micro to nanoseconds off the copper connections in your computer, that's thousands to millions of times smaller than internet latencies. You have to be doing bulk processing on a lot of data for those tiny savings in data to add up, as far as I understand. They mention servers and I have a hard time imagining when a home PC will see benefits from this. Now once all the servers running the Internet to your house have this, then it may help, that's where a lot to most of your latency happens anyway. I definitely don't know for sure though, certainly not an expert in this field, just going off a basic understanding. Still a cool technology though and nanoseconds of savings in our highly digital world across millions of servers will add up to real seconds quickly. Really says a lot about our world where the next way we improve efficiency is shaving off billionths of a second by getting fiber connections closer to the processor. Please, if someone understands this better please correct me as I think the basics I know are right but I'm sure my specifics can be corrected.

I think you can do this with blender

Obviously not