ASTRON aims at the development of high-capacity, energy-efficient and bit-rate flexible optical transceivers capable of supporting rates from 10Gb/s to beyond 1Tb/s. The ASTRON concept is based on developing multi-functional and agile devices so as to achieve Terabit capacities on a single photonic integrated chip. ASTRON's transceiver can realize different techniques of flexible super-channel generation (OFDM/Nyquist WDM) and does so without requiring any IDFT/DFT processing in the electronic domain, thus achieving ultra-high capacity with significant improvements on the energy efficiency per transmitted bit. To implement optically the IDFT/DFT functions, a special design arrayed waveguide grating (AWG) based planar lightwave device will be developed.ASTRON relies on the combination of InP monolithic elements and Silica planar lightwave circuits for achieving cost-effectiveness, high yield, low power consumption and device scaling far in advance of the level commercially available today. The transmitter module that implements the optical super-channels employs a planar optical multi-channel Silica motherboard carrying four hybridly integrated InP-based twin-IQ Mach-Zehnder Modulators in combination with a novel 8x8 AWG-based waveguide structures on board. The receiver is a fully integrated, multi-channel optical coherent receiver module consisting of a similar 8x8 AWG-based waveguide structure with DFT functionality, eight 90° hybrids and high speed balanced photo-detector arrays of 32 active elements per polarisation, hybridly integrated onto a Silica motherboard. Additionally, ASTRON will develop advanced digital signal processing algorithms for impairment mitigation and a novel software-defined signal processing module that renders the transceiver flexible in terms of format, bit rate and spectrum utilization. Each component within this project is not just aimed for a one time demonstration but is fabricated keeping one eye on commercialisation.