Light Reading

Euro FTTH Switch Could Take 92 Years

Ray Le Maistre
11/23/2012
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What will the world be like in 2100?

A United Nations report suggests the world's population could be as high as 15.8 billion, oil reserves will have run dry, food shortages will be acute and the Rolling Stones will be staging their 73rd farewell tour (OK, the last item was ours, not the UN's…)

Cities could look like this, if scientists are to be believed.

And according to a forecast by the fiber broadband experts at Ventura Team , there will still be some homes in the European Union's 27 member nations without a fiber broadband connection…

The broadband consultancy predicts that, at the current rate of migration, "a full switchover from copper-based to completely fibre-based broadband (FTTH) could take 92 years unless EU governments decide to significantly change telecom regulations and embark on a comprehensive Fibre Switchover Plan."

Another 92 years? That takes us to 2104. "The current switchover is happening at a snail's pace and it could seriously obstruct economic growth across Europe for a long time to come," notes the consultancy in a press release promoting an extensive 66-page report compiled by Ventura and funded by the FTTH Council Europe .

Why 92 years? Here's the explanation from the report:

    To take fibre into every home in the EU27 -- excluding the 40% in urban areas that we assume will take cable broadband -- will cost an estimated €272 billion [US$351 billion]. We believe ~€11 billion [$14.2 billion] has already been invested so the investment still required is €261 billion [$336.7 billion]. The industry invests roughly €20 billion [$25.8 billion] per annum in fixed networks but on average over the last four has invested less than €3 billion [$3.9 billion] p.a. of that in fibre. At that rate, it will take 92 years to achieve the Fibre Switchover.


Currently, according to the latest numbers released by the FTTH Council Europe, about 28.2 million of the 210 million homes in the EU 27 countries are passed by fiber (fiber-to-the-home or fiber-to-the-building) and about 5 million actually have a fiber broadband connection. And according to a Heavy Reading forecast published earlier this year, the prospects for any significant fiber uptake in EU member states in the next five years are slim. (See FTTH 2012: Springtime for Euro FTTH .)

But, of course, it doesn't need to be the next century before all Europeans have fiber broadband. Ventura has come up with a seven-point plan (which includes changes in regulation, pricing and the concept of universal service) that would enable the switchover to FTTH to be completed within 25 years without any need for taxpayers' money to be used. The Ventura team even identifies existing sources of capital that would provide €250 billion ($322.6 billion) of funding for FTTH rollouts within the next eight years.

"A much faster fibre switchover inside the EU27 is entirely possible provided that there is enough political will and that the right regulatory changes are made," says Stefan Stanislawski, one of the report's authors and a partner at Ventura Team, in a prepared statement. "In fact, a fibre switchover would generate jobs and growth to repay the investment," he adds.

And therein lies the problem, of course. There's no doubt that much more could be done in many industrial verticals with a combination of enough political will and favorable regulatory changes: Enabling that combination is the hurdle that looks almost insurmountable.

That doesn't mean the report isn't a worthwhile document. Ventura's consultants know what they're talking about and have real-world experience of fiber broadband rollouts, having advised and worked on client deployments and even created their own broadband service provider in Sweden (see the company's credentials for more details). So this isn't another report written by fresh-faced graduates with MBAs and some spreadsheet models, and even if the political will and suggested regulatory changes fail to materialize there's still plenty in the report that's useful and relevant to broadband decision-makers and influencers.

The Ventura report is available for anyone to download -- get it by clicking on this hyperlink.

— Ray Le Maistre, International Managing Editor, Light Reading

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User Rank: Light Beer
12/5/2012 | 5:17:12 PM
re: Euro FTTH Switch Could Take 92 Years


I do wonder, by the time we reach 2030, for example, what impact that advances in wireless technology will have on FTTH business cases for domestic broadband services.


Multitenant buildings, businesses etc could all do with a few fibers, but I'd say it's possible that there will be no reason ever to take fiber to some users -- and that's not to say they won't have decent broadband - maybe 8G wireless (or whatever G we reach...) will meet plenty of people's needs.

Richard Jones
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Richard Jones,
User Rank: Light Beer
12/5/2012 | 5:17:11 PM
re: Euro FTTH Switch Could Take 92 Years


It's an interesting point about wireless.  I worry that LTE will be used as a weak answer to the Digital Agenda for Europe.  Sadly the laws of physics and shortage of spectrum will cause an issue into the future.  


LTE will deliver fast headline speeds but, like 3G early on, can only do so to users who are logged on in the early hours when they are alone on a base station.  So governments might claim DAE targets have been achieved with LTE but, whereas FTTH or FTTH might deliver consistent speeds, LTE will only be able to deliver widespread DAE type speeds from time to time.


The mobile business is pretty broken as you know with the huge data increases meeting reducing ARPU's head on.  In reality, the more data an operator offers, the worse it gets for them.  To do LTE requires a significant investment but if all operators do it, there is no differential advantage to compensate for that investment.


PS  By the way, I know of one operator (not in Europe) that has upgraded to 4G for free.  They have simply re-labelled their 3G service as 4G - I kid you not.  


Richard Jones - Ventura Team LLP

Richard Jones
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Richard Jones,
User Rank: Light Beer
12/5/2012 | 5:17:10 PM
re: Euro FTTH Switch Could Take 92 Years


Your ball rubbing habit deserves a swift and unequivocal end on its own :o


I will tell you the comedy 4G story offline.  It's hilarious but true.


 

digits
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digits,
User Rank: Light Beer
12/5/2012 | 5:17:10 PM
re: Euro FTTH Switch Could Take 92 Years


Did someone say Star Trek?


Maybe to get a clearer picture of the future I need a can of Mr Sheen and some dilithium crystal balls to rub...


I'm quite happy with the telling/killing arrangement, btw...

Richard Jones
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Richard Jones,
User Rank: Light Beer
12/5/2012 | 5:17:10 PM
re: Euro FTTH Switch Could Take 92 Years


I shall tell you all... but might have to kill you afterwards ;)


It's the future so automatically is hard to predict.  But if Neilsen's Law holds and people want their Ultra-Def TV to work (maybe two in the house) then the bandwidth demands are going to get pretty crazy.  GFast might do it for a while if you're really close to the cabinet but I think wireless has limits that will be hard to overcome.  


The Swedish guys with their rotating system for increasing bandwidth per carrier (don't ask me to explain it - it's complificated), have had scorn poured on their approach and I don't think there's anything out there offering realistic, reliable high bandwidths across an area.


Quantum teleportation will be around in 50 years perhaps so we might get Star Trek technology before we get the network we've paid for from operators.  You and I are paying part of our subscription to get our networks renewed..... and.... well there's not a lot of renewal.


PS  Well done for reading and digesting the report so quickly.  It's almost like you could do this for a living ;)

digits
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digits,
User Rank: Light Beer
12/5/2012 | 5:17:10 PM
re: Euro FTTH Switch Could Take 92 Years


Richard.... now you are required to tell me EVERYTHING!!!  :-)


 


re LTE - 4G services are never going to be an answer to truly high-speed broadband - I am thinking about the deployment of future generation wireless technologies in mesh network topologies with a microwave or NGPON fiber backhaul, serving multiple dwellings/businesses.


But not LTE.

digits
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50%
digits,
User Rank: Light Beer
12/5/2012 | 5:17:09 PM
re: Euro FTTH Switch Could Take 92 Years


Beam me up, Dickie...

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