Li-Fi is a wireless communication technology that uses light to transmit data between devices. It has the potential to be much faster than Wi-Fi, yet use a lot less energy.
Li-Fi will be able to transmit data at high speeds over the visible light, ultraviolet, and infrared spectrums. Currently it uses LEDs which transmit data in visible light. Wi-Fi uses the radio frequency to transmit data.
Li-fi software modulates the LED at incredibly high speeds (up to tens of million times per second). Digital content is encoded as data into visible light by rapidly flickering a LED on and off repeatedly. These correspond to 1s and 0s, which are bits of binary data, and then software is used to transform these bits into digital content such as pictures and videos. Since the frequency of visible light is about 10,000 times faster than radio waves, Li-Fi is much quicker than Wi-Fi. Hundreds of gigabits per second is achievable, and this is even faster than fiber optic cables.
Li-Fi is able to function in areas otherwise susceptible to electromagnetic interference (e.g. aircraft cabins, hospitals, or the military). However, other sources of light, for example the sun, will interfere with the signal. Also, since Li-Fi's short wave range is unable to penetrate walls, transmitters would need to installed in every room of a building to ensure even Li-Fi distribution.