The ranking, issued twice a year since 2007, was released today at the FTTH Council Europe's annual conference in Copenhagen, Denmark. It tracks the level of FTTH market penetration in economies where more than one percent of households are connected directly into high speed fiber networks. In all, 20 economies met this threshold, up from 14 in July 2008 and 11 in July 2007.
The growth is largely due to the entry of several European countries in the ranking, as fiber to the home deployment begins to expand across that continent and the total number of FTTH subscribers in Europe approaches two million.
Asian economies maintained their leadership in FTTH market penetration, as South Korea (44% of the market), Hong Kong (28%), Japan (27%) and Taiwan (12%) continued to hold the top four places respectively.
Meanwhile, Japan remains the overall leader in terms of the number of fiber-connected homes at 13.2 million, followed by the United States (6.05 million) and the People's Republic of China (5.96 million).
For the first time, the Councils' ranking includes the breakdown for each economy between fiber to the home connections, where fiber is run all the way to individual residences, and fiber to the building (FTTB) connections for which the fiber terminates at a multi-unit dwelling and a non-fiber local area network (LAN) delivers service to the individual subscribers. In addition, FTTB subscriber numbers have been added to the totals for the United States, which accounts for much of the substantial increase in that country's totals since the previous ranking in July 2008. Copper-based broadband access technologies (DSL, FTT-Curb, FTT-Node) are not included.
The breakdown between FTTH and FTTB for each economy is depicted in the following chart:

"It is very encouraging to see four new EU nations joining Russia and Andorra in the new ranking, together nearly doubling Europe's total representation among the top twenty in the world," commented Joeri Van Bogaert, President of the FTTH Council Europe. "It is perhaps more difficult for the largest countries to achieve the ranking, which makes Russia's inclusion particularly exciting and surprising. Across Europe, we are seeing FTTH penetration figures rise as the benefits of fiber become clearer for all."
"Fiber to the home continues to grow rapidly in the United States, thanks to Verizon's aggressive deployment of its all-fiber network and the growing interest in FTTH among smaller telephone companies who see it as essential to their survival in the digital economy," said Joe Savage, President of the FTTH Council North America. "Subscriber satisfaction and high FTTH market share are driving this growth."
"We are pleased that Asia Pacific region continues to occupy the top slots in the rankings on market penetration, thanks largely to the very high level of market penetration in South Korea, Hong Kong, Japan and Taiwan," said Shoichi Hanatani, President of the FTTH Council Asia Pacific. "While no newly additional economies from the region were able to break into the ranking this time, we are seeing a lot of interest in a number of Asian economies and believe it won't be long before others begin significant FTTH deployments."
Labels: Economics, FTTH Council
Study shows link between Socio-Economic prosperity and FTTH
0 comments Posted Tuesday, January 27, 2009The results and full report of a groundbreaking study into the socio‐economic impact of European FTTH deployments, undertaken in conjunction with analyst firm Ovum, will be unveiled by the FTTH Council Europe at its annual conference in Copenhagen next month. The study has been carried out using a wide range of metrics that determine relative ‘prosperity’ and its correlation to FTTH deployments at the local/regional level.
In summary, the study will deliver definitive results to the following questions:
‐ Which socio‐economic benefits does FTTH engender, and to what extent?
‐ How does FTTH change the way in which subscribers use telecommunications services?
‐ Does adopting FTTH increase customer satisfaction in broadband services?
“Advocates for FTTH frequently use the hypothesis that it enhances social inclusion and positively impacts the social and economic welfare of its consumers, and this study is designed to substantiate that claim once and for all,” explained Joeri Van Bogaert, President of the FTTH Council Europe. “This is one of the exciting new developments most keenly anticipated by our delegates who are looking forward to learning the results at next month’s conference.”
The study will test the presence of quality of life improvements among FTTH subscribers by using a large range of metrics (from levels of computer literacy to distributions of income/wealth), and validating these further via consumer interviews and surveys in order to provide accurate social commentary. The study will further apply detailed comparative analysis with areas not currently served by next‐generation fibre broadband services. Full details of the study’s methodology and findings will be disclosed at next month’s annual conference.
For more information about the conference speaker programme, and about the FTTH Council Europe in general, visit www.conference.ftthcouncil.eu.
OECD Updates Stats on FTTH and other Broadband Technologies
0 comments Posted Monday, November 24, 2008Some other interesting statistics:
* The average advertised DSL speed is 8803/1236Kbps compared to FTTH which is 79,562/62,755kbps
* Australia sits ninth with the average advertised speed by country with 12,130kbps
Read the OECD's press release, from which you can link to further information from the organization's latest study.
Commissioned by the Fiber-to-the-Home (FTTH) Council, the study looked at the environmental costs of running fiber optic cables all the way to the subscriber premises, and balanced them out with the sustainability benefits that faster, next-generation connections will bring - particularly with regard to gasoline saved when more people are able to use those connections to work from home.
The preliminary results of the study were announced at the FTTH Council's 2008 Conference & Expo, which is underway this week in Nashville, Tennessee.
"This conservative estimate from a widely respected firm says essentially that supercharging bandwidth in American homes with FTTH, by enabling more telecommuting, is an environmentally sustainable activity that goes 'green-positive' in six years," said Joe Savage, President of the FTTH Council. "For telecom providers, it means that upgrading to fiber to the home is not only a good business proposition, but it is also a good way to go green."
Using its established Life Cycle Analysis methodology that it has applied globally across other industries, PwC assessed the sustainability aspects of North American FTTH deployments in urban, suburban, and rural scenarios - taking into account a mix of aerial and underground installation of cable. Environmental costs associated with deployment included use of non-renewable energy, emissions of greenhouse gases and acid substances into the atmosphere, formation of photochemical oxidants to produce smog, introduction of harmful nutrients into water and depletion of non-living resources during the life cycle of FTTH network deployment and operation.
In its methodology, PwC applied only one prospective benefit of deploying FTTH networks, that beyond 2010 an estimated 10 percent of the working population with FTTH service would telecommute an average of three days a week because bandwidth improvements will make working from home more feasible. This estimate is based on the results of earlier FTTH Council surveys measuring actual FTTH subscriber behavior. Benefits were calculated from savings estimates related to reduced gasoline consumption and savings on road maintenance and construction.
"With the assumption of a future low-carbon economy and increased environmental regulation, FTTH solutions are a key sustainable utility driver," the report said.
PwC did note that there are considerable additional social and economic benefits that are associated with fiber-driven, next-generation networks over the longer term, but are not included in this study.
Network modeling data was provided by FTTH Council members and incorporated approximately three quarters of existing FTTH deployments in the U.S.
Source: FTTH Council
Labels: Economics, FTTH, FTTH Council
According to an article published by Computerworld NZ, John Keys - the leader of the Nationals - was speaking at the CIO Conference in Auckland on Tuesday and said that "globalisation and the brain drain were threatening the local economy. We lost 81,000 people last year, 45,000 to Australia. We had the highest brain drain per capita of any country in the OECD for tertiary qualified people.”
Keys further added, "Three areas where New Zealand has a comparative advantage are food production, tourism and in service-based industries where companies offer a niche service that can be globally connected to the world.”
“If we get it right, you’re going to see businesses able to locate themselves in New Zealand", he said. This is not new information and has been quoted by many broadband advisory groups around the world. The Global Digital Economy is exactly about business which can operate "virtually" anywhere in the world and therefore it comes down to a lifestyle choice - and New Zealand is certainly a nice place to live.
Capital investment typically flows to the locations which are best serviced with the right infrastructure and operating costs. India and its call centres and software development houses are prime examples of that economic movement. Without Fibre to the Home, New Zealand will be very much the last choice for investors in the Digital Economy, and if that investment is being made else where, the "Brain Drain" will only get worse.
Currently New Zealand sits at number 35 out of 42 in the recently released Broadband Quality study, and will fall further behind as China and India increase their deployment of Fibre to the Home.
Key says the Nationals want to invest more than $1 billion into rolling out fibre to 75% of homes throughout New Zealand, as well as business districts and schools. But this proposal has seen a lot of criticism from the current government and some carriers with a vested interest in their existing infrastructure.
Labels: Economics, FTTH, New Zealand
High-Quality Broadband Essential to Growth of the World’s Knowledge Economies
0 comments Posted Wednesday, September 17, 2008The study which focused on 42 countries within the OECD plus Brazil, Russia, India and China (BRICs), was conducted by a team of MBA students from the Saïd Business School at the University of Oxford and the University of Oviedo’s Department of Applied Economics.
Just over half of the countries studied enjoyed broadband at a level of performance required to deliver a consistent quality experience for most web applications today. But major countries such as the UK, Spain, Italy and you guessed it Australia and New Zealand fell well below this threshold. Japan however topped the chart with a score almost twice its nearest rival. They are a nation which made an early commitment to broadband and now have more Fibre to the Home connections than DSL. Late last century the government realised Broadband as a source of competitive advantage, and created their eJapan strategy.
“The Broadband Quality study was developed on the premise that the new generation of web applications will rely on a higher level of performance of broadband connections,” explained Alastair Nicholson from Saïd Business School at the University of Oxford. “Average download speeds are adequate for web browsing, email and basic video downloading and streaming, but we are seeing more interactive applications, more user-generated content being uploaded and shared, and an increasing amount of high-quality video services becoming available. Moreover, because the study also found significant correlation between a nation’s broadband quality and its advancement as a knowledge economy, policy makers may need to consider how to create an environment to improve key broadband performance parameters in the future.”
From Australia's perspective this is why the government is investing the $4.7b in the National Broadband Network. The economic benefit from having a high speed infrastructure provides the key ingrediant in building a better future for the country. However as it stands today Australia is placed 28th on this list, and has a long way to improve. With many of the nations in the top 20 acknowledging the importance of the Digital economy, they have made commitments to similar projects as our own NBN, but instead of choosing the cheap and easy path with FTTN, have decided to go all the way with FTTH. Ultimately if we continue down the FTTN path, Australia's competitive position will fall further behind other global digital economies.
Using eight million records from broadband speed tests conducted by users around the world through www.speedtest.net, the researchers calculated statistical averages for each country of several key performance parameters used to determine the quality of a broadband connection.
The researchesr concluded broadband experience is mainly affected by speeds in both directions, latency, network oversubscription, and packet loss. These parameters were grouped into three major categories: download and upload throughput, and latency. The Broadband Quality Score (BQS) for each country was determined using a formula that weighted each category according to the quality requirements of a set of popular applications now and in the future.
Typical applications for today include web browsing, social networking, music downloads, basic video streaming and video chatting, and enterprise-class home offices. Future applications include consumer telepresence for communications, healthcare and education, high-quality video file sharing and streaming, high-definition IPTV, cinema-quality live event broadcasts and advanced home automation.
“By using actual broadband-quality test results, the research team has given us a fresh insight into what users around the world are really experiencing and whether they can look forward to enjoying new applications,” said Fernando Gil de Bernabé, managing director at Cisco’s Internet Business Solutions Group. “A nation’s leadership in broadband was typically determined by its ranking on penetration, and now we know that this will not be enough. This study gives broadband stakeholders, from governments through to telecom and cable operators and vendors like Cisco, as well as consumers, a better understanding of the importance of quality broadband connections. Without high-quality broadband, we will not be able to take full advantage of the next wave of productivity, collaboration and entertainment.”
Professor María Rosalía Vicente from University of Oviedo pointed out about the digital divide and that "the broadband gap can no longer be seen as a penetration divide", but "also a quality and capacity divide, and therefore, a divide in the range of services people can access and use.”
The composite measure takes into account three indicators: household broadband penetration, average speed weighted by percentage of subscribership (Mbps), and lowest available price per Mbps.
While our household penetration is very good ranking us in ninth place, and our pricing is excellent with a ranking of sixth; its our average speed which is of most concern. Of the thirty OECD nations which take part in the Broadband rankings, we are ranking twenty sixth on speed, just above Mexico, Greece and Spain.
What is most worrying is the state of the NBN proposals from the major players, and their continued focus on FTTN. Back in April I wrote an article on the Myth of FTTN and how the current proposals would not meet the performance targets announced by the Government in their 2007 strategic paper and policy launch. More importantly those proposals will not keep Australia competitive in terms of the Digital Economy. To achieve a competitive performance target of 50/12Mbps every home would need to be within 500 metres of a node. If that were achieved today the bandwidth would put us third on the OECD list. However, the current proposals are for every home to be within 1500 metres of a node, giving subscribers an average speed of 18/2Mbps.
If you look at the bandwidth growth over the past 3 years, by the time we start to roll the NBN the top 5 (currently Japan, Korea, Finland, France and Sweden) will be well passed our MAXIMUM capacity, and the top 15 (USA, Denmark, Netherlands, Norway, Switzerland, Greece, Iceland) will most likely be passed that point with their rapid growth in FTTH deployment.
One only has to look at the USA where 2 years ago their average speed was 1.5Mbps. They now are averaging close to 8Mbps. Back then the MAXIMUM speed on offer was 20Mbps on either cable, copper or Fibre. However Verizon through their FiOS product is now offering 100Mbps in some areas and the number of connected customers has doubled. Even the MSOs have doubled their speed offerings (abet introducing download limits) in that same time, and the upgrade to DOCSIS 3.0 is only just starting. My prediction for the USA is within 2 years their average will be 30-40Mbps.
So much for being competitive in the Global Digital Economy.
Press Release
July 25, 2008
The Federal Communication Commission's proposed broadband goals are "too vague and tame" to meet the rapidly increasing consumer appetite for high-bandwidth video and data services, and they need to be more ambitious if the U.S. is to keep pace with other industrialized countries, according to comments filed yesterday before the FCC by the Fiber-to-the-Home (FTTH) Council.
"We believe the Commission should be more ambitious in seeking to promote the universal availability of not only broadband services but high-bandwidth, bidirectional broadband services," the Council noted in the filing.
The comments were submitted in response to the Commission's Broadband Goals as set forth in the latest draft of the FCC's revised strategic plan for 2009-2014. In the filing, the Council urged the Commission to adopt the goals outlined in the "100 Megabit" Congressional Resolutions introduced by Senator John D. Rockefeller IV (D-WV) and U.S. Representative Anna Eshoo (D-CA). Those resolutions call for universal and affordable access by 2010 to networks transmitting at 10 megabits per second bidirectionally, and to 100 megabits bidirectionally by 2015.
"In this era of expanding user-generated content - from video uploads and peer-to-peer applications to the ongoing development of cloud-computing applications - our government has to move beyond its current view of what broadband is supposed to do," said Joe Savage, President of the FTTH Council. "In order to ensure our national competitiveness, our policies need to recognize that consumers will need vastly expanded bandwidth for uploading data, as well as much faster download speeds, in just the next few years."
The FTTH Council's filing cited a UBS Investment Research report indicating that average data speeds worldwide are growing at an annual rate of 20% to 30%, and that the current average speed for downloads is already 10 Mbps globally. It also cited a Cisco Systems report predicting that Internet traffic in North America alone will triple over the next four years, and grow even faster in parts of Asia and Europe where FTTH networks are being aggressively deployed.
"Today, a little more than 10 percent of American households have access to FTTH networks," said Savage. "We need to ensure that our government's policies promote the most aggressive deployment of these critical, high speed, next-generation networks so as to ensure that America keeps pace with the world in the availability of next-generation broadband. And the FCC's strategic planning needs to be brought up to speed to ensure that this happens," he said.
Asia-Pacific Continues to Lead in FTTH Market Penetration
0 comments Posted Wednesday, July 23, 200823 July 2008.
With continued regional growth in fiber to the home (FTTH) market penetration, Asia consolidated its position as the global leader in the march toward next-generation broadband while the United States and Europe also continued to experience robust growth in FTTH, according to an updated global ranking issued today by the FTTH Councils of Asia-Pacific, Europe and North America.
The ranking, updated twice a year and released today at the FTTH Council Asia-Pacific’s 3rd Annual Conference and Exhibition in Kuala Lumpur, Malaysia, tracks the level of FTTH market penetration in economies where more than one percent of households are connected directly into high speed fiber networks. In all, 14 economies met this threshold.
South Korea, Hong Kong, Japan and Taiwan now occupy the top four positions in the ranking, and the Asian region now accounts for more than 27 million of the world’s estimated 32 million fiber to the home connections. South Korea now has nearly 37 percent of its households connected to fiber, with Hong Kong at 27 percent, Japan at 24 percent and Taiwan at 7.7 percent. And while the People’s Republic of China ranked 11th in terms of market penetration, growth in the number of connections to 7.5 million means that China is now second only to Japan in the number of households with FTTH.
"This is an exciting time for FTTH broadband in Asia. FTTH has overtaken DSL in South Korea and will soon do the same in Japan," said Shoichi Hanatani, President of the FTTH Council Asia Pacific. "Here in the Asia-Pac region, we are witnessing the end of a hundred years of telecom history as copper loops are quickly being replaced by optical fiber access networks."
Four Scandinavian countries (Sweden, Norway, Iceland and Denmark) and Slovenia occupied the fifth through ninth positions in the ranking, with market penetration ranging from 7.5 percent to 3.2 percent. The Netherlands and Italy were in the 12th and 13th positions, each with market penetration of 1.4 percent. In all, European countries reported 1.4 million FTTH connections.
Joeri Van Bogaert, President of the FTTH Council Europe, noted that large FTTH projects now underway in France and Germany, as well as deployments in other EU countries such as Greece and Portugal, will likely affect the rankings in the near future.
"The fact that seven European countries made the global ranking, and that several rank among the top FTTH countries in the world, is a clear indication that Europe is moving forward with the adoption of next-generation broadband," he said. "However, this positive picture does not yet represent the entire continent, which is why the FTTH Council Europe will continue to educate investors and other stakeholders and to promote accelerated deployment of FTTH networks in all European countries."
The United States is third among the world’s economies in the total number of FTTH households at 3.3 million, and is in 10th position in the global ranking with 2.9 percent market penetration. The U.S. continues to experience the highest rate of growth of any economy in terms of FTTH subscribers – doubling the number of connections year over year. This is due largely to an aggressive FTTH deployment by market leader Verizon, Inc. and ongoing FTTH build out by more than 600 smaller providers across the country.
"Clearly, North America, and particularly the United States, has crossed the chasm and is now moving decisively toward fiber to the home as the broadband platform of choice," said Joe Savage, President of the FTTH Council North America. "Aggressive FTTH deployment in the U.S. has created a lot of buzz about this exciting technology, and the word of mouth from early FTTH subscribers is driving growth and fueling further deployments."
The three regional FTTH Councils joined together last year to create this official global FTTH ranking in order to provide the telecommunications industry, governments and regulators with a unique snapshot of international fiber access penetration. The global ranking follows the unified definition of FTTH terms announced by the three councils in 2006, and which has formed the basis for on-going market research by each council. For completeness and accuracy the ranking includes both FTTH and FTTB (fiber-to-the-building) figures, while copper-based broadband access technologies (DSL, FTT-Curb, FTT-Node) are not included.

Labels: Economics, FTTH Council
According to WEK, this raises the possibility that incumbents could once again increase their market share and re-create the monopoly they once enjoyed, reversing the trend towards more competition in telecommunications. Telstra has already been doing this in Australia, by rolling either FTTN or FTTH into new greenfield developments, effectively enliminating their competitors from gaining access to the ULL.
The research, which was commissioned by the pro-competition European Competitive Telecommunications Association (ECTA), covers Germany, France, Spain, Italy, Portugal, and Sweden. It combines results from WIK's research with independent research carried out for regulators, governments and the OECD in other countries, which reaches a similar conclusion. WIK says "its study demonstrates that, because of substantial economies of scale, replication of fiber access lines for high-speed services is not economically viable on any widespread basis."
The research indicates that it is significantly more cost-effective for incumbents to roll out fiber networks than it is for entrant operators to do so. Incumbents can save up to 30% of their investment compared to standalone operators. The three key reasons for this conclusion are that incumbents already own ducts on a nationwide basis; they can make substantial efficiency savings compared with their current network structure; and they already have the number of required subscribers that would pay for the investments simply by switching customers from their existing lines. In some of the countries examined, significant viability was found for incumbents to roll out next-generation access networks even with a relatively conservative return on capital of around 10%, which is commensurate with returns made on today's regulated copper access networks.
A Framework for Evaluating the Value of Next Generation Broadband
Models for efficient and effective public sector intervention in next generation broadband access networks
The reports estimate that upgrading the national infrastructure to reach 80% of UK homes with fibre-optic networks could cost in the region of £16bn. More over, this might end up being a mix of Fibre to the Home (FTTH) and Fibre to the Curb (FTTC), perhaps with some wireless mixed in for those hard to reach locations:
"We assume availability to 80 per cent of the population of the UK, corresponding to towns and cities, in our fibre scenarios. Beyond this level of coverage costs are likely to rise significantly and commercial rollout is less likely to be feasible in the foreseeable future. We discuss the question of whether further rollout would bring additional benefits following our assessment of costs and benefits for the 80 per cent availability scenario. We also assume rollout of FTTC over 5 years and FTTH over 10 years or more."
"The performance of FTTC would be intermediate between copper and fibre all the way to the premise. A preliminary estimate is that FTTC might offer a median upstream speed of around 10 Mbps and a median download speed of 22-30 Mbps. Openreach is carrying out trials and modelling work to refine estimates of the likely capability of FTTC in the UK."
This is consistant with an article I published some months ago called the "Myth of FTTN". No FTTN (let alone FTTC) network is going to be able to deliver 12Mbps upstream with nodes installed at 1 kilometre from the home.
However, Antony Walker, CEO of the Broadband Stakeholder Group, also warned that trying to jump right in and solve the problem immediately was not necessary - just so long as the UK doesn't wait too long:
"It is tempting to jump in feet-first but it matters more to do this right than to do it now. There is a lot of uncertainty about issues on both the demand and supply side and much that we can learn from experience elsewhere without adverse affects in the short-term. On the other hand, the UK can't wait too long. If widespread network deployment didn't happen in the medium term (perhaps three to five years), then this report suggests that the UK could be losing out.
The report also warns that it will take longer to deploy next generation broadband than it took to deploy the current generation and that some areas might be beyond the reach of market forces. Communities and individuals that remain beyond the reach of commercial deployment in the long-term will be disadvantaged. Close attention must therefore be paid to the emergence of a new digital divide."
Ofcom's Consumer Panel raised similar concerns in this mornings news item and they will need to be addressed ASAP. Having some communities with access to speeds reaching nearly 100Mbps, while others barely achieve 512Kbps, should be deemed totally unacceptable.
There are a number of interesting points which are raised, including an acceleration of FTTH and FTTB deployments and subsciptions. As of December 8% of all broadband connections in the OECD are Fibre based. In Japan FTTH/FTTB accounts for 40% of all broadband subscriptions and 34% in Korea.
Of considerable note were the various recommendations to OECD nations. The report recommends that if governments are providing money to [partially] fund broadband rollouts, it should avoid creating a new monopoly. My point exactly and what we at the SIG recommended to government. This leads onto the second recommendation where the "government should promote competition and give consumers more choice...[and] should encourage new networks". To be consistant with these recommendation and deliver the best outcome to the consumer the NBN should be an overbuild creating two competing infrastructure networks, allowing the market to drive and set pricing rather than a government regulator.
Following one "any new infrastructure built using government funds should be open access – meaning that access to that network is provided on non-discriminatory terms to other market participants", that is certainly the mainstay of the NBN request for proposals, but will it be the outcome.
This is an initial review of the summary information. I will add more detail to this analysis during the week.
The number of broadband subscriber in the OECD reached 235 million by December 2007, an increase of 18% from 200 million subscribers in December 2006. This growth increased broadband penetration rates to 20.0 subscriptions per 100 inhabitants up from 16.9 in December 2006.
- Denmark, the Netherlands, Iceland, Norway, Switzerland, Finland, Korea and Sweden lead the OECD with broadband penetration well above the OECD average, each surpassing the 30 subscribers per 100 inhabitants threshold.
- The strongest per-capita subscriber growth over the year was in Luxembourg, Germany and Ireland. Each country added more than 5 subscribers per 100 inhabitants during the past year. On average, the OECD area increased 3 subscribers per 100 inhabitants over the year.
- The upgrade to fibre-based connections continues in the OECD. Fibre-to-the-home (FTTH) and Fibre-to-the-building (FTTB) subscriptions comprise 8% of all broadband connections in the OECD. Fiber connections account for 40% of all Japanese broadband subscriptions and 34% in Korea.
- The United States is the largest broadband market in the OECD with 69.9 million subscribers. US broadband subscribers represent 30% of all broadband connections in the OECD.
OECD points to weaknesses in broadband development and identifies emerging policy issues.
The OECD is also releasing a new Broadband report (Main findings / Full report) which examines the evolution of broadband since 2004 and the national broadband plans of all OECD member countries. The report highlights the significant progress that has been made in the development of broadband across the OECD countries, notably and the progress that has been made in extending broadband to rural and remote areas as well as in connecting schools, libraries and other public institutions. The report also examines areas of weakness and examples of innovative policies from countries.
Looking ahead, the report notes that:
- Governments need to promote competition and give consumers more choices. They should encourage new networks, particularly upgrades to fibre-optic lines.
- Governments providing money to fund broadband rollouts should avoid creating new monopolies. Any new infrastructure built using government funds should be open access – meaning that access to that network is provided on non-discriminatory terms to other market participants.
- Governments should discourage harmful business conduct and practices such as misleading advertising and unjustifiably long consumer lock-in periods.
- OECD firms and governments need to do more to realise the full potential of broadband and move beyond pilot projects for pressing social issues in areas such as health, transport and the environment.
- The strengthening of broadband research networks (grids), their use for collaborative research and related international cooperation should be a policy priority.
- Governments need to actively monitor and quantify their own progress with their broadband plans and adjust policies and attention accordingly.
For further information, journalists should contact Taylor Reynolds (+33 1 45 24 9384) and/or Sacha Wunsch-Vincent (+33 614943838) of the OECD’s Information and Communications Policy division.
Data and charts available at: http://www.oecd.org/sti/ict/broadband
The deployment would be worth at least NZD2.7 billion annually in increased productivity, the National Party says. The ruling Labour Party says the proposals lack credibility, however, and would go against recent regulatory changes which are intended to improve competition in broadband markets. Communications Minister David Cunliffe said in a statement: ‘If this extravagant subsidy is ever rolled out all of the good work the government, industry, and business have done in dismantling Telecom's monopoly position will be lost.’
The full details of the announcement can be found here: http://www.national.org.nz/Article.aspx?ArticleID=12141
Labels: Economics, New Zealand
The document is a balanced (although somewhat inaccurate in parts) view of the various last mile technologies that could be used in the building of a National Broadband Network. It includes evaluations of various technologies (FTTH, WiMAX, BPL, VDSL2, ADSL2+, HSDPA/HSUPA, DOCSIS) available to roll-out high speed first mile networks with speeds of up to 50 Mbit/s. It clearly indicates that though wireless technology will be important, it will not be the dominant technology to connect homes and businesses to broadband networks. Instead wired technologies have a distinct advantage in performance as well as economic investment.
As I have been discussing in a number of forums, the OECD paper supports my suggestion that both WiMAX and HSDPA/HSUPA will be a valuable technology to use in the regional/rural areas where FTTN or FTTH would be too expensive to deploy due to distance and housing density. It also suggests that FTTN (both VDSL2 and ADSL2) is a short term "step" technology to FTTH. However, the document does make one negative comment towards FTTH:
"When examining the market from the point of view of investors, it becomes clear that the dynamic situation and the economics of an investment make it likely that many long-term investors will remain wary of investing in fibre to the home. The costs are substantial and the risk posed by competing hybrid networks can be substantial."
This comment is actually not orginal and is quite dated. It comes from a statement made by one of the investment houses (Goldman Sacks from memory) on Verizon's annoucement of their FTTH rollout in early 2004. Three years later in 2007 they admitted they were wrong in their conclusion and recommendation on Verizon. FiOS had been a great success and the turning point for the company. Furthermore if the Australian Government is contributing to the investment in a National Broadband Network, does this not significantly lower the financial risk to investors.
I read with interest the pricing model of their pilot projects on page 45, where the report suggests the cost per home passed will be AUS$1384 and the cost per home to connect will be AUS$1230. Interestingly the numbers mentioned in the SIG recommendations to the Governement where AUS$500 and AUS$1200 respectively. While we were very close on the cost to connect, there was a substainial difference on the cost to pass.
Why is that? Well one needs to carefully read both reports and understand the differences in modelling and deployment methods. To summarise those differences:
- Fibre to the home in Netherlands has been based on Point to Point (PtP) topology and not Passive Optical Network (PON) topology. The projects evaluated in the costing model where all PtP.
- The cost differential between PON and PtP topologies in the Passive components of the network (the fibre and its installation) is SUBSTAINIAL. The supply and installation of PtP passive components can be three to four times more expensive than PON. This is mainly to do with the loop lengths, the size of conduits and the much higher cost in splicing.
- A PtP topology also uses a seperate fibre for the MATV, thus adding twice the cost of fibre and installation on top of the already inflated passive cost.
- The pilot projects and financial models were based on the cost of undergrounded fibre, rather than 70/30 mix of aerial/underground deployment as suggested in the SIG recommendations. Underground is $500 per home more expensive than aerial.
- The financial model included Amortisation, Depreciation and Interest, which are operating costs not capital costs. The SIG recommendations where based on capital cost only
- The average price of 872 Euros (A$1384) is excessively high even when compared to Verizon and NTT, or the TasColt and Bright Trials.
- The average price of 872 Euros (A$1384) would be consistant with the use of PTP fibre optic infrastructure.
- These projects used a new leadin to the home, whereas the SIG recommended to reuse the existing leadin thus saving about $200.
- The projects where also rather small, and would not get the economies of scale such that NTT and Verizon currently enjoy
So in conclusion, the information presented by the SIG is consistant with that of the OECD report when one considers the savings of PON, Aerial, Amortisation, Interest, Depreciation, and staffing. This would equate to $850-900 ($500 aerial, $200 PON, $100 Amortisation/Int and Dep, $50 staff) in savings thus giving a price of about $485-$535 (the SIG estimated $500). So in all, the prices quoted in the SIG report are consistant to those quoted in the OECD report when considering the different parametres and application to the models.
One final point for those who have disagreed with my article "The Myth of FTTN". The OECD also draws the same conclusion in regards to VDSL2 technology; that it would require nodes placed less than 450 metres from the house to deliver the required symmetrical performance.
Quoting from the introduction "One reason why the pace of fibre investment in the local loop is relatively slow in many OECD countries is the cost associated with network construction, in particular for rights of way and ducts or poles, as well as the associated legal and regulatory difficulties in obtaining permits for access to streets, roads, and other public land."
The issue of rights of way in laying fibre in the last mile is a complex legal and technological problem and is closely interlinked with national, state and local government legal framework and policies. This was certainly identified by the SIG and it needed a regulatory intervention to smooth the process, particular when some local governments are so opposed to aerial infrastructure.
The report listed a number of recommendations which can improve access to rights of way and reduce the cost associated with deployment
- Reducing barriers associated with obtaining authorisation for access to and use of rights of way.
- Ensuring clarification of jurisdiction for both granting rights of way and settling disputes and coordination among the public authorities involved.
- Harmonising administrative procedures for access to rights of way and ensuring consistency in the application of these procedures across a country.
- Developing a reasonable system of compensation for access to and use of municipal public rightsof way.
- Ensuring that operators investing in ducts are subject to a minimum set of obligations for remediation and maintenance.
- Encouraging and/or obliging sharing of ducts and other rights of way both by incumbent communication companies and by other utilities that have infrastructure.
- Examining the role of public-private partnerships in the deployment of dark fibre and/or third party infrastructure providers for duct sharing.
- Examining the possibility of regulatory measures to facilitate the sharing of inside wiring between operators in multi-dwelling units.
- Developing policies to construct joint ducts by new entrants.
Many of the points raised in this document where also touched on in the SIG report, so its great to get something from the OECD support the position of the SIG. Hopefully this will be viewed by the government in support of the previous recommendations
According to "The New Zealand Institute", an independent think tank, a new high-speed broadband network would generate additional economic benefit for the country of $2.7 billion to $4.4 billion a year, with additional gains possible through enabling innovation.
The institute believes New Zealand should aim for 75% population coverage using fibre to the home(FTTH) within 10 years. However, lack of investment in broadband due to its inadequate regulatory framework will condemn New Zealand to slow economic growth.
"The proposed investment pathway does not come close to positioning New Zealand to achieve the broadband aspiration in a timely manner. Significantly more investment is required," institute chief executive David Skilling said.
Full details of the report can be viewed here .
Labels: Economics, New Zealand
The new ranking, released today at the FTTH Council Europe's annual conference in Paris and based on statistics gathered at the end of 2007, lists 14 economies where more than one percent of households are connected directly into high speed fiber optic networks. On the three councils' first-ever ranking, released last July, 11 economies exceeded the 1 percent threshold. Slovenia, Iceland and Singapore were the new entries on the list.
Globally, 2007 was the best year yet in terms of numbers of new subscribers to FTTH services, thanks primarily to strong growth in Japan, China and the United States, where a total of nearly 6 million new FTTH households were added for the three countries.
"What this indicates is the unrelenting vigor of the FTTH industry here in Europe - where we surpassed one million connections - and worldwide," said Joeri Van Bogaert, President of the FTTH Council Europe. "This phenomenon is driven by something that never slows down, and that is the consumer appetite for ever-higher bandwidth."
The updated ranking shows that Asian economies continue to outpace the rest of the world in terms of FTTH market penetration, with South Korea moving into the top slot with 31.4 percent of households connected, followed by Hong Kong at 23.4 percent and Japan at 21.3%.
A large gap separates third place Japan from fourth place Sweden, where 7.1 percent of homes are wired with FTTH, followed closely by Taiwan at 6.8 percent and Norway at 6 percent. Denmark, at 2.5 percent occupies seventh position on the chart.
The United States, by more than doubling its penetration rate to 2.3 percent, moved up three places to eighth position, followed by two of the three countries making their first appearance on the chart, Slovenia at 1.8 percent and Iceland at 1.5 percent. The People's Republic of China moved from tenth to eleventh place as direct fiber connections in that country moved up slightly to 1.5 percent.
Netherlands, Italy and Singapore rounded out the list with market penetration rates ranging from 1.1 to 1.4 percent.

The three regional FTTH Councils joined together last year to create this official global FTTH ranking in order to provide the telecommunications industry, governments and regulators with a unique snapshot of international fiber access penetration.
"We're delighted to see the U.S. moving up the global ranking, indicating a good beginning is underway. FTTH leadership, demonstrated by those leading countries, shows full national deployment is achievable" said Joe Savage, President of the FTTH Council North America. "The future belongs to those countries that satisfy the broadband consumer's need for speed. Our members - the FTTH equipment vendors and the service providers - are ready to help make it happen on a wide scale across North America."
"It is no accident that Asia-Pac continues to be the fastest growing region for FTTH in the world, with more subscribers connected on fiber than all other regions combined," said Schoichi Hanatani, President of the FTTH Council Asia-Pacific. "The rollout of FTTH has been encouraged by forward-looking governments and regulators in the Asia-Pac region for several years now. They understand that FTTH is a key strategic national infrastructure."
The global ranking follows the unified definition of FTTH terms announced by the three councils last year, and which has formed the basis for recent market research by each council. For completeness and accuracy the ranking includes both FTTH and FTTB (fiber-to-the-building) figures, while copper-based broadband access technologies (DSL, FTT-Curb, FTT-Node) are not included.
About the FTTH Council Europe
The FTTH Council Europe www.ftthcouncil.eu is a market development organisation with a mission to accelerate the availability of fibre-based, broadband access networks to consumers and businesses. With few exceptions, Europe lags well behind the US and Asian tiger economies in the availability of high-speed broadband services (100 Mbps and upwards). The Council believes that the development of fibre-based access networks is fundamental to the deployment of such services, and hence to reaping their benefits for European citizens and businesses. The Council's charter is to work with European governments, policy-makers and opinion leaders qualify and quantify the benefits to be gained from fibre-based broadband access networks, and to identify and help to erode the barriers to their development. Council members are drawn from the telecoms (vendors), broadband content and academic sectors.
About the FTTH Council Asia-Pacific
The FTTH Council Asia-Pacific www.ftthcouncilap.org is a non-profit organization whose mission is to educate, promote and accelerate FTTH and the resulting economic and quality-of-life enhancements across the Asia-Pacific region. Formally registered in February 2005, and with over 40 member organisations spread across the Asia-Pac region; this Council maintains close links with sister organisations in Europe and North America. The Council is a group of leading telecom, networking, and infrastructure companies whose mandate is to promote the extension of fiber access across the Asia Pacific region including Greater China, Korea, Japan, SE Asia, India, Thailand and Australia
About the FTTH Council North America
Now in its seventh year, the Fiber-to-the-Home Council is a non-profit organization established to help its members plan, market, implement and manage FTTH solutions. Council membership includes municipalities, utilities, developers, and traditional and non-traditional service providers, creating a cohesive group to share knowledge and build industry consensus on key issues surrounding fiber-to-the-home. Communities and organizations interested in exploring FTTH options may find information on the FTTH Council web site at www.ftthcouncil.org.
For more information contact:
FTTH Council Europe
Jennifer Manning/ David Evans
Cohesive Communications
+44 (0) 1291 626200
ftth@cohesive.uk.com
FTTH Council Asia-Pacific
FTTH Council Asia-Pacific Secretariat
info@ftthcouncilap.org
FTTH Council North America
David St. John
+1.315.849.3800
media@ftthcouncil.org
Labels: Economics
For the full brief of this article by Leith Campbell, Principal Consultant at Ovum go to http://www.ovum.com/go/content/c,71701.
Labels: Economics
Please note that some of these documents can take up to 2 minutes to load.
Other white papers more specific to land developers can be found under the "Developers" tab, or click here.
Introduction to Fibre to the Home (FTTH)
Author: Stephen Davies (stephend@qwestcom.com.au)
Published: July, 2007. Revision: 1

FTTH: A necessary future
Author: Stephen Davies (stephend@qwestcom.com.au)
First Published: November, 2005. Revision: 1


IPTV: Keys to a successful deployment
Author: Stephen Davies (stephend@qwestcom.com.au)
Published: October, 2006. Revision: 1


Application Drivers for FTTH Networks
Author: Stephen Davies (stephend@qwestcom.com.au)
Published: July, 2006. Revision: 1

Building an Open Access Network
Author: Stephen Davies (stephend@qwestcom.com.au)
Published: July, 2007. Revision: 1

FTTH Topology options and Considerations
Author: Stephen Davies (stephend@qwestcom.com.au)
Published: July, 2007. Revision: 1

Documents published by Others
A Guided tour of PON Solutions
Author: Tom Van Caenegem (tom.van_caenegem@alcatel.be)
Published: unknown. Revision: 1
Abstract:

FTTH is greener
Author: PriceWaterhouseCoopers
Published: February, 2008. Revision: 1

FTTH Broadband Primer
Author: FTTH Council and Broadband Properties
Published: April, 2008. Revision: 1

Examples of Centralised Splitters using FDH
Author: ADC
Published: - Revision: 1

GPON versus EPON
Author: Alloptic
Published: November, 2004. Revision: 1

Active vs PON: FTTx Technology Choices
Author: Allied Telesis
Published: November, 2004. Revision: 1

Fiber-Enabled Healthcare Services
Author: Rob Scheschareg (rscheschareg@yahoo.com)
Published: Oct, 2007. Revision: 1

Towards Competitively Neutral Fiber to the Home (FTTH)
Author: Anupam Banerjee (anupam_banerjee@cmu.edu)
Published: Oct, 2007. Revision: 1

Labels: Communities, Economics, IPTV, Open Access, Technology, White Papers