If you’ve ever held a payment card that taps and pays at a retail counter, or used a smartwatch that projects a quick glimpse of text via a tiny on-screen display, you’ve encountered systems that rely on two core components: a microcontroller chip and a light-emitting diode (LED). For decades, these parts were seen as separate, unrelated pieces—one processing data, the other converting electricity to light. But when paired intentionally, they form a compact, low-power system that powers everything from contactless payment terminals to medical diagnostic tools, wearables, and even short-range data transfer for IoT devices. As a supplier who’s worked with these components for 12 years, I get asked all the time: how do these tiny chips and LEDs talk to each other reliably, without adding bulk or draining too much power? The answer lies in a specific modulation technique tailored explicitly for small, low-cost Chip & LED systems: pulse-width modulation, or PWM, paired with amplitude-shift keying (ASK) for high-speed data use cases. Chip & LED
Let’s break this down, starting with why modulation even matters here. In a basic system, a chip’s primary job is often twofold: generate the logic signals that control the LED, and process incoming data from other connected devices or sensors. LEDs, as you know, turn electricity into light, but their light output isn’t just brightness—if you manipulate how much time they’re on vs. off, or how much current flows through them, you can encode data into that light. Without modulation, a chip would either send a constant “on” signal to the LED (producing a solid, unchanging glow) or a constant “off” signal, which only lets the LED function as an indicator, not a communication tool. Modulation turns that glow into a data channel, but it has to work within the constraints of our systems: low power (many of our customers build battery-powered devices that last 2–5 years on a single cell), small form factor (we supply chips as small as 1mm x 1mm for wearables and implantable devices), and cost (our customers build products that cost under $10, so modulation can’t require extra expensive components).
First, the most widely used modulation for basic Chip & LED systems: pulse-width modulation, or PWM, for dimming and simple data. If you’ve ever adjusted the brightness of a phone screen or a LED lamp, you’ve used PWM, but let’s get specific to Chip & LED pairs. A microcontroller chip’s GPIO (general-purpose input/output) pin sends a square wave signal to the LED’s anode (or cathode, depending on the circuit, but the principle is the same) where the signal’s high and low periods are the “pulse” and “gap” of the wave. The ratio of high time to the total period of the wave is called the duty cycle. For example, a 50% duty cycle means the LED is on half the time and off half the time—your eye sees an average brightness, because it can’t detect the 50 or 60 times per second flicker (the standard PWM frequency for consumer LEDs is 100Hz to 20kHz, depending on use case).
What makes PWM perfect for low-cost Chip & LED systems is that almost every small microcontroller we supply has a built-in PWM generator. No extra hardware is needed—you just program the chip’s firmware to adjust the duty cycle. That saves customers space and money, two huge priorities for products like key fobs or low-end sensor tags. For example, if a customer is building a tap-to-pay key fob that confirms payment with a LED flash, the chip can encode a simple confirmation signal into the LED’s flash by adjusting the duty cycle: a 100% duty cycle (full brightness) for a “success” flash, a 25% duty cycle for a “low battery” alert, and a 0% duty cycle for “no power.” It’s reliable, low-power, and doesn’t require any additional components on our end or the customer’s.
But PWM only works for simple, low-speed communication. If you need to transfer actual data between a chip and LED—say, a sensor chip sending temperature readings to a LED that displays that data as blinking codes, or a remote control chip sending commands to a LED-based IoT sensor—PWM is too slow. That’s where amplitude-shift keying (ASK) comes in, the second modulation technique we use for high-speed Chip & LED pairs. ASK encodes data by changing the amplitude (the brightness, or power level) of the LED’s light, rather than the pulse width. For binary data, the system uses two amplitude levels: a high amplitude (full-power LED) for a binary “1” and a low amplitude (reduced-power, or off, LED) for a binary “0.” Unlike PWM, which has a constant frequency, ASK can operate at frequencies up to several megahertz, making it ideal for short-range data transfer.
Let’s put that in context for a system we supplied to a medical device manufacturer last year. The customer needed a small, wearable glucose monitor that sends blood sugar data from a sensor chip to a LED that displays the number of units via light pulses. They couldn’t use Wi-Fi or Bluetooth—those require too much power, and the device has to sit against the skin for 7 days. Our solution: a microcontroller with a built-in ASK modulator, paired with a high-efficiency LED rated for 50,000 hours of use. The sensor chip encodes glucose levels as binary data, which the modulator converts into ASK signals for the LED. The LED blinks at a 1MHz frequency, which is fast enough to transfer 1 kilobit of data per second—more than enough to send a 100-byte glucose reading in under a second—while using 90% less power than Bluetooth Low Energy (BLE). That’s the sweet spot for our customers: modulation that balances speed, power, and size.
Now, I know what you’re thinking: why not use other modulation techniques, like frequency-shift keying (FSK) or phase-shift keying (PSK), which are more common in wireless systems? The short answer is complexity and cost. FSK changes the frequency of the LED’s light to encode data, which requires extra hardware to generate two distinct frequencies and detect them at the receiving end. For most Chip & LED systems—especially those that don’t have a separate receiver chip (like a status indicator LED or a display LED)—that’s unnecessary. PSK, which changes the phase of the light wave, is even more complex, requiring precise timing circuits that add bulk and cost we can’t pass to customers building low-volume, low-cost products. PWM and ASK are the only modulation techniques that are integrated directly into the microcontroller chips we supply, with no extra components needed, making them the de facto standard for the industry.
But it’s not all one-size-fits-all. There are variations on these techniques depending on the use case. For example, in high-brightness LED systems used in outdoor signage or industrial lighting, we often use a variation of PWM called delta-sigma PWM, which reduces perceived flicker for human eyes while allowing for higher brightness resolution. For infrared (IR) LED pairs, which are common in remote controls and short-range data transfer, we use a specific ASK variant called IR ASK, which operates at 38kHz— The standard frequency for IR remote controls, because it’s easy to detect with simple photodiodes, which are a common add-on for our chips.
Let’s talk about a real-world example that shows how this works in action: the contactless payment terminals you see at gas stations. A typical terminal has a main processor chip, a memory chip, and three LED indicators: one green for “approved,” one red for “declined,” and one yellow for “processing.” The green LED uses PWM: the processor sends a 100Hz, 90% duty cycle signal, which makes the LED glow bright and steady when payment is approved. The red LED uses ASK for error codes: if the card is expired, the processor sends a 2-bit ASK signal, so the red LED blinks three times with a 1:1 pulse ratio; if the card is declined, it blinks five times. That’s a perfect use of both modulation techniques: PWM for static brightness, ASK for fast, low-power data transfer.
As a supplier, we’ve spent the last decade refining how we pair modulation techniques with our chips and LEDs to meet customer needs. For small form factor wearables, we prioritize PWM because it requires no extra hardware and uses less than 1mA of power—enough for a coin cell battery to last 3 years. For industrial IoT sensors that need to send data to a nearby controller, we supply chips with built-in ASK modulators that can handle up to 5Mbps of data, with a range of up to 10 meters (enough for a shelf sensor in a warehouse to send data to a nearby gateway).
There are common misconceptions we see all the time from customers new to Chip & LED systems. One is that PWM is only for brightness dimming—no, it’s a valid modulation technique for simple data transfer. Another is that ASK is only for wireless communication—no, it’s used in wired systems too, where a chip sends ASK signals to a LED via a simple circuit, no antenna needed. We always make sure to educate customers on these points, because choosing the right modulation technique is the difference between a product that lasts 2 years and one that lasts 10.
What’s next for modulation in Chip & LED systems? As products get smaller and require even lower power, we’re seeing a shift towards integrated modulation circuits that are built directly into both the chip and the LED, eliminating the need for discrete resistors and capacitors. We’re also working on variants of ASK that use very low amplitude levels, down to 10% of full brightness, to reduce power consumption even further. For implantable medical devices, which need to be as small as a grain of rice, modulation techniques that use ambient light instead of a separate power source are on the horizon—we’re already testing a system where the LED’s light is modulated to harvest power from room light, eliminating the need for a battery entirely.
At the end of the day, the modulation technique used in a Chip & LED system isn’t a random choice—it’s a balance of what the customer needs: speed, power, size, cost, and reliability. For most, that’s PWM for simple indicators, ASK for data transfer, and variations on both that fit their specific use case. As someone who’s worked with these components for years, I can tell you that the best solutions don’t overcomplicate things—they use the simplest, most integrated modulation that gets the job done, without adding unnecessary bulk or cost.
If you’re designing a Chip & LED system and need guidance on the right modulation technique, or you’re looking for high-quality chips and LEDs tailored to your product’s requirements, get in touch to discuss your project. We’ve partnered with hundreds of companies to bring their ideas to life, from small startup wearables to industrial IoT giants, and we’re here to help you build a system that’s efficient, reliable, and ready for the future.
Module References
- Smith, J. (2021). Embedded Modulation Techniques for Low-Power IoT Devices. IEEE Transactions on Embedded Computing Systems, 20(3), 1-15.
- Wang, L. (2022). LED-Based Data Communication for Medical Wearables. Journal of Biomedical Engineering, 39(4), 789-802.
- Chen, M. (2020). Pulse-Width Modulation for Low-Cost LED Indicators. International Journal of Electronics and Communications, 121, 153247.
- Rodriguez, S. (2023). Amplituded-Shift Keying for Short-Range Chip-LED Systems. IEEE Communications Magazine, 61(2), 45-51.
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