Iliad Gets Active With FTTH

French operator Iliad (Euronext: ILD) has confirmed it will deploy an "active Ethernet" strategy, where each household has a dedicated fiber connection, in its planned €1 billion (US$1.27 billion) fiber-to-the-home (FTTH) rollout. (See Iliad Plans €1B FTTH Build.)

Network operators building FTTH networks deploy either dedicated point-to-point access connections, known as active Ethernet, or passive optical networks (PONs), where the final fiber connection to the customer buildings is shared.

PON technology has prevailed in FTTH developments to date, especially in North America and Asia/Pacific, says Graham Finnie, senior analyst at Heavy Reading, and author of a recent report on fiber access strategies. (See FTTH Hits Mainstream and FTTH Surge Coming.)

There has been support for active Ethernet in Europe, especially in Amsterdam, but not previously on this scale: Iliad plans to hook up 4 million buildings and serve up to 10 million customers with its fiber rollout, starting in Paris in early 2007 and then spreading to other major French cities. (See Amsterdam Gets Active With FTTH.)

It also plans to make its FTTH network available to other service providers on a wholesale basis, a model favored by municipal network operators that want to encourage service competition.

So Iliad's decision "is a significant boost for the active Ethernet sector. Most deployments to date have been one city or town -- there hasn't been anything on this scale announced before now. Assuming that Iliad follows through on its plans, that's a big vote of confidence in the technology," says Finnie.

"This is a debate the PON folk want to go away, but in open networks, such as Iliad's, it's a very credible choice. It's a very intense debate -- which is the right approach for next-generation access networks."

It's a debate that has valid arguments from both sides, suggests Martin Thunman, CEO of Swedish equipment vendor PacketFront AB , one of Europe's most vocal active Ethernet proponents. "You can debate the pros and cons of active versus passive, but the most important thing to take from Iliad's news is that it's a major boost for FTTH overall. The thing Iliad has realized is that there's a good business case for fiber."

What's interesting about Iliad's strategy is that it plans to deploy FTTH in areas where it has already built an ADSL2+ network, notes Thunman, "so they're going to migrate customers from copper to fiber. The thing about FTTH is that it allows the operator to totally bypass the incumbent operator. With local loop unbundling you still have plenty of charges you have to pay the incumbent" -- e.g., for using the local exchange and copper connection.

So is PacketFront pitching Iliad to provide its fiber access technologies? "We intend to pitch to anyone who has plans to deploy this sort of solution," says the CEO, but he wouldn't comment on whether an approach had been made or if PacketFront has seen any bid documents.

Iliad isn't saying anything either. It won't comment on whether it has issued a Request For Proposal (RFP) document to equipment vendors, such as Cisco Systems Inc. (Nasdaq: CSCO), which is supplying its active Ethernet technology for Amsterdam's FTTH project, and PacketFront, or whether it has already chosen an equipment supplier.

One possibility is that Iliad might not source its technology externally. The company developed its own DSLAM technology, and has claimed to have benefited from the move in terms of capabilities and, in particular, time to market, so the possibility exists that it might again develop its own access equipment for the FTTH rollout.

The active vs. passive debate will continue in Dallas next week where Finnie will moderate a panel on the FTTH Race at Light Reading's Optical Expo.

— Ray Le Maistre, International News Editor, Light Reading

Interested in learning more on this topic? Then come to our upcoming conference, Optical Expo 2006. This conference and exhibition will be staged in Dallas on September 19 & 20, 2006. Admission is free for attendees meeting our prequalification criteria. For more information, click here.

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