Plasmons are density waves of electrons, created when light hits the surface of a metal under precise circumstances. These density waves are generated at optical frequencies and are very small and rapid. They can theoretically encode a lot of information, more than what's possible for conventional electronics. Plasmonics is thought to embody the strongest points of both optical and electronic data transfer, allowing the fast transmission of information over very small wires.
Optical data transfer, as in fiber optics, allows high bandwidth but requires bulky "wires" — really tubes with reflective interiors. Electronic data transfer operates at frequencies inferior to fiber optics, but only requires tiny wires. Plasmonics, sometimes called "light on a wire," would allow the transmission of data at optical frequencies along the surface of a tiny metal wire, despite the fact that the data travels in the form of electron density distributions rather than photons.
The main limitation to this technology today is that plasmons tend to dissipate after only a few millimeters, making them too short-lived to serve as a basis for computer chips, which are a few centimeters across. For sending data over longer distances, the technology would need even more improvement. The key is using a material with a low refractive index, ideally negative, such that the incoming electromagnetic energy is reflected parallel to the surface of the material and transmitted along its length as far as possible. No natural material with a negative refractive index exists, so nanostructured materials must be used to fabricate effective plasmonic devices. For this reason, plasmonics is frequently associated with nanotechnology.
Before all-plasmonic chips are developed, the technology will probably be integrated with conventional silicon devices. Plasmonic wires may act as high-bandwidth freeways across the busiest areas of the chip. This technology has also been used in biosensors. When a particular protein or DNA molecule rests on the surface of a plasmon-carrying metallic material, it leaves its characteristic signature in the angle at which it reflects the energy.