For the Next Generation Access Network (NGAN) wavelength division multiplexed passive optical networks (WDM PON) appear a promising and suitable solution offering almost unlimited bandwidth similarly to point-to-point links, while allowing the advantages of fibre sharing.It is widely recognized that WDM PON deployment requires colourless Optical Network Unit (ONU) transmitters, so that each user has the same transmitter. Up to now these characteristics has been unsatisfactorily obtained either with a costly tunable transmitter or by exploiting external seeding sources.ERMES proposes a disruptive approach to the ONU transmitter. The breakthrough idea is to use a significant portion of the network to implement an embedded self-tuning modulable laser cavity.This idea is based on establishing a very long cavity laser, which can be directly intensity modulated. The goal is achieved by using a dedicated multifunction active chip (MFAC), which acts as the gain medium of the cavity including: the array waveguide grating (AWG) and a reflector at the remote node (RN), and the distribution fibre connecting the ONU to the RN. After cavity set up, the active chip is directly modulated enabling up-stream up to 10 Gb/s data-rate per user. The development of a MFAC suitable for this application is mandatory to bring ERMES approach from the proof-of-principle stage closer to industrial exploitation.This solution is a potential highly effective alternative to the existing approaches in terms of cost reduction as it is colourless and gets rid of the need for external seeding sources. It is also appealing in terms of achievable performance, as it is not impaired by Rayleigh back-scattering, allowing for longer bridged distances.ERMES success will enforce European industrial leadership in the access arena, whose development in terms of capillarity and bandwidth has major social and economical fallouts. Therefore it addresses the objective of ICT-2011.3.5b.