FTTH on horizon as telecoms, equipment manufacturers look for next-gen product

Fibre to the home (FTTH) may well be the next big thing in the telecom world, but it is still years away from being commercially viable. That hasn’t stopped at least one manufacturer, however, from unveiling a new product to provide FTTH to private customers and small businesses. Several sessions at the Metro Networks and Last Mile Access workshop held in Ottawa last week dealt with the topic of FTTH and the difficulties of rolling out the system. A major concern discussed was how to create a competitive marketplace. "Telecom is the last bastion of monopoly operation where services and infrastructure are provided by the same company," Bill St. Arnaud, senior director of network projects at CANARIE Inc., told delegates. "Government policy makers are going to have increasing input on future broadband access technologies to ensure competition." St. Arnaud told the conference, which was sponsored by Communications and Information Technology Ontario (CITO) and the Ottawa Centre for Research and Innovation, that once fibre is deployed it will overtake other technologies for fixed telecom services. One fibre strand has more capacity than the combined bandwidth of all fixed wireless networks, he pointed out.Providing true competition will be difficult, he added, since it is unlikely several companies will roll out to the same neighbourhoods. St. Arnaud is a proponent of municipal condominium networks and cited as examples work currently underway in Halifax and Vancouver. Norman Smith, Bell Canada’s associate director of access network standards, says price is one of the primary factors delaying rollout of FTTH. The cost of running fibre to communities is "borderline" compared to the costs of installing very high data rate DSL (VDSL). Those expenditures are reasonably close in new developments – the "greenfield" areas under construction – but very high where copper is already deployed. "It’s borderline in greenfield areas, and there’s no way where you have copper plant. It just isn’t economical yet," he tells Network Letter. "And we really don’t see the business drivers for it. We can provide most of what we think we need in residential capabilities with the copper." Mark Klimek, senior director of marketing & business development for Alcatel, agrees with that. Alcatel is introducing its 7340 Fiber to the User (FTTU) product, which will permit customers to use various technologies through fibre. The product offers up to four POTS lines per subscriber, at least 10 Mbs broadband data access, and interactive video services. DSL market not abandoned But the manufacturer is not abandoning the DSL market. Alcatel knows how vital copper wires are to the telecom carriers."There’s billions and billions of kilometres of copper in the ground today and operators want to continue to use that and generate additional revenue and value out of their current investment," Klimek offers. "So toward that end, we’re building lots of DSL products and working hard to bring out new services and applications to run on those to allow operators to continue to operate their networks and extract revenue and provide value and service to their customers." Klimek says the company is responding to demand in the marketplace. The firm was receiving requests from many smaller builders who were constructing new communities. They were interested in laying fibre, but had no telecom equipment on hand. "We did some market research and it seemed that there really is a market for this," Klimek explains to Network Letter. "The costs of the equipment and the basic underlying technologies came down such that we could actually build a fibre to the home product that you could build a business case for and it would be deployable." St. Arnaud said the models for FTTH are constantly being upgraded. The first-generation FTTH operates much the same as the original telco model, in which competitors can only get open access through passive optical networking (PON). This system is currently being tested in Atlanta. Second-gen models work on the assumption that there will be separation between providers and an aggregator using Gigabit Ethernet or ATM. This process is great for data, but merely satisfactory for video. The results for other services are unclear. This model is undergoing trials in several rural American communities and in Iceland. The nascent third-gen FTTH will have structural separation using condominium fibre and choice of aggregator or service provider through point-to-point fibre and reverse PON. This system has yet to be proven in the marketplace, St. Arnaud stated. Moving the DMZ One of the chief changes that will have to be made is shifting the line between the carrier and the consumer, or "moving the DMZ" as St. Arnaud styles it. He likens the process to what happened in the telecom world. At one time, subscribers were forbidden to add anything to their phones. Then deregulation permitted customers to own their own phones, setting the DMZ at the phone jack. The CANARIE executive suggests moving the DMZ to the central office. Under this proposal, the consumer would own the individual fibre from the residence to the neighbourhood node, where a connection would be made to the service provider. The customer would decide whether to sign with an aggregator, convergence provider, or single service Internet provider. All three experts agree that the easiest markets to serve are urban core areas and remote districts. Suburban areas, built up over the past 20 years or so, are proving a challenge, as land has to be dug up to upgrade facilities. Klimek says broadband PON is the best way to reach remote parts of the country. Fibre has very low loss, permitting signals to carry long distances. They can go about 20 km in any direction without amplification. "It actually lends itself very well to some of the more remote areas of Canada. Now if there’s just a single isolated house out on the prairie, that’s a problem," he notes. "But in some of the villages or smaller towns you can get a lot of people in a certain span and that’s all from one single point of presence." Klimek notes the recent downturn in the telecom market has not really affected sales of DSL equipment. Bell and Telus Corp. continue to roll out service and the Alcatel executive reports great interest from dele-gates at the United Telecom Council meeting in Vancouver last March (NL, Apr. 9/02).

FTTH on horizon as telecoms, equipment manufacturers look for next-gen product

News | June 3, 2002

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