A new report by Tariff Consultancy Ltd. finds that FTTH (Fibre To The Home) services are becoming increasingly competitive with conventional Triple Play broadband services In Europe and are already undercutting traditional ADSL2+ services.

In a new report called FTTH Pricing in Europe 2009, Tariff Consultancy Ltd provides a unique survey of the main FTTH providers in 19 European countries – from Austria to the UK.

The pricing of more than 26 FTTH infrastructure providers are profiled across Europe. Pricing is also included of a number of service providers who offer services to the end user household over an open access FTTH infrastructure.

FTTH Pricing in Europe 2009 provides pricing examples from key European FTTH suppliers and also compares current provider pricing with the established FTTH providers in Hong Kong, Japan and South Korea. South Korea offers clearly the lowest cost FTTH service worldwide.

An increasing number of European FTTH providers are offering a 100MB service at 30 euro per month. The price point of 29 to 35 euro being the most frequent price point adopted for a basic 100MB broadband FTTH service, and frequently an FTTH Triple Play service in a competitive market.

"Although there remain significant differences in FTTH pricing, it is clear that where there are competing service providers in Europe FTTH rates – even at 100MB - are becoming highly competitive with ADSL services that are a tenth of the speed," says Margrit Sessions, Managing Director of Tariff Consultancy Ltd.

Out of 13 FTTH providers in Europe, more than half are providing 100MB FTTH and Triple Play services that are the same or less than the monthly rate of a lower speed ADSL2+ Triple Play service. There is also a growing threat to traditional broadband providers posed by the Cable TV operator. Cable TV operators are in the process of upgrading existing coaxial access networks using the DOCSIS 3.0 standard to cater for high speed IP traffic of up to 120MB per household.

Telecoms operators as varied as Telefonica, BT and Swisscom are considering how to deploy FTTH networks in response to the cable TV operators. But across Europe the deployment of FTTH is being made at different speeds.

"Operators such as FASTWEB in Italy see only a limited market for FTTH for the consumer as ADSL services are still becoming established," commented Sessions. "But in France a number of telecoms providers are offering FTTH services as the next stage as the DSL market reaches saturation. Increased fibre capacity is becoming a key differentiator for service providers."

The wide range of FTTH service providers in Denmark, the Netherlands, Sweden, Norway and Finland where a number of utility and municipal providers sell fibre capacity to a large number of service providers including in some cases the incumbent telecoms provider. "Although it is certain that there will be new investments in FTTH, it is unlikely that there will be any major uplift in revenues if FTTH is provided as an access mechanism."

It is not enough to provide a pure fibre access, and operators are discovering that there is no single "killer application" that is driving FTTH deployments.

"Instead FTTH operators will find that the increased demand for capacity plus the opportunity to offer supplementary services including TV on Demand, Symmetrical Bandwidth, Music, and Storage services to boost ARPU," concludes Sessions.

It will be those FTTH providers that are most successful in selling additional services that will see a greater return on their fibre investment. But providers should be aware that as equal access networks will be the preferred model to deploy FTTH, as it is more economic to lay a single network infrastructure but offer multiple service providers through that infrastructure.

Service providers need to focus on delivering added value services over FTTH it is likely that intense price pressure will result in a commoditised access pipe service.

About FTTH Pricing in Europe 2009
The new report surveys the pricing of 26 infrastructure FTTH providers across 19 European countries. It includes examples of FTTH service provider pricing (where multiple service providers use the same open access FTTH infrastructure) and includes comparable ADSL Broadband and Cable TV high speed broadband pricing. It also includes pricing from key FTTH providers in Hong Kong, Japan and South Korea where fibre deployments are more common as a benchmark.

The European countries included in the 60 page report are:

Austria, Belgium, Czech Republic, Denmark, Iceland, Finland, France, Germany, Italy, Lithuania, Netherlands, Norway, Portugal, Slovenia, Slovakia, Spain, Sweden, Switzerland, and the UK.

The report costs 995 GBP's for a single user licence. Further information is available at: www.telecomspricing.com

SOURCE: Tariff Consultancy Ltd. (TCL)


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