FT Fleshes Out FTTH

BARCELONA -- FTTH Council Europe 2007 -- France Telecom SA (NYSE: FTE) has set a target of hooking up 180,000 FTTH customers by the end of 2008, the company confirmed here at the FTTH Council Europe event Wednesday.

The carrier outlined its two-year, €270 million (US$351 million) FTTH (fiber to the home) buildout to investors last December following multiservice trials in Paris and Bratislava, Slovakia, having initially revealed an interest in fiber build-out early in 2006. (See FT Unveils NGN, FTTH Plans and France Telecom Plans FTTH.)

Gilles Coullon, an FTTH networks and IT vice president at the carrier, told conference delegates here that FT aims to have 40,000 FTTH customers by the end of 2007 and 180,000 by the end of 2008.

He said the carrier considered all the fiber possibilities -- to the curb, to the building, to the node, to the je ne sais quoi -- before deciding that the FTTH option "is more future proof," which was also the reason FT was waiting for GPON technology to become available, even though that wait "was a bit of a risk." The carrier used GPON equipment from Alcatel-Lucent (NYSE: ALU), which names FT among 40 FTTH deloyments (including trials) globally.

Coullon also noted, though, that a point-to-multipoint PON solution (as opposed to a point-to-point fiber for each home) was always likely to be chosen because "that best suits our legacy infrastructure, in terms of duct space and building space. A solution that takes up less space is preferable."

FT's main conclusions from its trials, which included fewer than 1,000 people, was that potential FTTH customers are most interested in high-definition TV (HDTV), having multiple TV streams coming into the home, and having significant upstream bandwidth for uploading video, pictures, and for general home working purposes.

It seems, though, that the main driver for FT's FTTH plans is competition, rather than a business-driven desire to provide greater bandwidth to its customers. A number of competitors have made France one of the most service-rich and innovative broadband countries in Europe. Other French players such as Iliad (Euronext: ILD) and Neuf Cegetel Group (Euronext: NEUF) have been strong competititors in the DSL market, and they have also announced fiber access plans, some of them very aggressive. (See Iliad Buys Into French FTTH, Iliad Plans €1B FTTH Build, Neuf Unit Wins FTTH Deal, and Neuf Acquires Mediafibre.)

But while a number of Europe's national operators, such as Deutsche Telekom AG (NYSE: DT), Eircom , KPN Telecom NV (NYSE: KPN), and Swisscom AG (NYSE: SCM) are deploying fiber-to-the-curb and reaching the home with VDSL2-over-copper for the final connection, France Telecom stands out as the only incumbent carrier in Europe that is deploying FTTH on any meaningful scale. (See Swisscom Finally Launches IPTV, KPN Trials VDSL2, and DT Flings Billions at Fiber Access.)

Hartwig Tauber, president of the FTTH Council Europe, confirms that developments are lagging there. Europe is suffering from a lower FTTH growth rate than competitive economies such as North America and, in particular, Japan, where there are already more than 7 million FTTH customers, compared with about 800,000 in the whole of Europe.

That low growth is caused in part by the scant involvement to date by incumbents, and the lack of Web and technology services innovation in Europe.

Tauber, though, is seeing a few encouraging signs. "Municipalities and utility companies are rolling out fiber, and incumbents are looking harder at it, as the demand for more bandwidth from customers is real. We are hoping for 6 million new homes to be connected with fiber by the end of 2009." (See Amsterdam Fires Up Muni Broadband.)

— Ray Le Maistre, International News Editor, Light Reading