The development of high performance semiconductor laser diodes has played a key role in the rapid deployment of optical fiber communications, and the realisation of advanced system concepts strongly depends on the further improvement of the laser diodes. This includes the demand for wavelength tunable single frequency laser diodes as well as the need for optoelectronic integration. The different laser structures in the 1.3 and 1.5 μ m wavelength regions, their relevant parameters and applications are described in this paper. The impact of recent progresses in the material technology on the device performance is particularly investigated. It is further shown that the availability of low‐cost, highly complex integrated optoelectronic components represents a prerequisite for the introduction of optical communication systems in the subscriber area. The photonic and optoelectronic integrated circuits presented so far for bidirectional transmission, photonic switching and optical distribution are presented and the challenges for the future development are discussed.