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Summary form only given. The talk will treat some physical layer issues in photonics, essential for the continued development and scaling of telecom and interconnect systems. These issues are concerned with information transfer capacity and the requirements for its continued exponential growth as well as the mitigation of the concomitant increased power dissipation. Further issues relate to the nanosizing of device structures to enable more complex and functional photonic circuits as well as lower cost photonics technology. Also discussed are the relations between photonics and electronics and the importance of viewing them as complementary and not competing technologies.