This paper describes the development of an extremely powerful, small-form-factor FPGA-based hardware system for high-bandwidth optical networks. This fully configurable platform exploits the recent advances in programmable logic to offer highly efficient and targeted solutions for a wide range of communications applications. As a first illustrative example, an FPGA solution for interface to the ITU-T G.709 Optical Transport Network (OTN) is presented, and the platform?s fast-prototyping and reuse potential is discussed. FPGAs are identified as ideal replacements for Application Specific Integrated Circuits (ASICs) in next generation communications networks, and a migration path to higher bandwidth configurable systems is proposed.