TeliaSonera Commits to FTTx
Although it's been pushing ahead with its fiber-to-the-home (FTTH) access plans in Finland (its other main domestic market), TeliaSonera hadn't, until now, committed itself to any major fiber access rollout in Sweden, though it has been involved in some collaborative, local municipal projects and has hooked up some buildings, with fiber LAN extensions to individual appartments, in a few major cities. (See Fiber to the Finns.)
Instead, the operator has relied mostly on DSL technology to deliver its triple-play services package. (See TeliaSonera Hits 300K.)
So Sweden's fiber access networks have been deployed by municipalities, utility firms, and rivals such as B2, which was acquired by Norwegian incumbent Telenor Group (Nasdaq: TELN). (See Nexans Wins Stockholm Deal, PacketFront Deployed in Sweden, Alcatel-Lucent Wins GPON Deal, PacketFront Gets €15M, New Customer, and Telenor on Billion-Dollar Spree.)
According to a recent Heavy Reading report on global FTTH deployments, Sweden is Europe's largest FTTH market, with more than 500,000 of its 4.5 million homes already connected to a high-speed fiber pipe. (See FTTH Technology Fracas Continues, Report: EMEA Set for FTTH Surge, and Asia, Europe Dominate FTTH Elite.)
Although so many Swedish homes already have a high-speed fiber connection, Heavy Reading chief analyst Graham Finnie, the author of the FTTH report, says TeliaSonera isn't too late to market. "There's a long way to go yet, but this is something TeliaSonera needs to do in Sweden to compete with the utility firms and municipalities."
TeliaSonera noted in its press release today that the project is "one of the largest infrastructure projects in the company’s history. Over a period of five years, the fixed broadband network will be upgraded to meet today’s and tomorrow’s demands for speed and capacity. The initiative will involve between 1.5 to 2 million households and enterprises all over Sweden."
The carrier says its research shows that 25 percent of Swedish businesses "are planning on investing in faster broadband during 2008," while demand from households for services such as HDTV and online gaming is driving consumer demand for very-high-speed access.
TeliaSonera is therefore planning to deploy a range of technologies to deliver broadband speeds of "up to 100 Mbit/second and higher... different technologies will be used to upgrade the network, depending on the geographic circumstances and the market’s needs." Fiber access and VDSL2 technology is to be used, sometimes in collaboration with "external parties, such as municipalities, building owners and housing co-operatives."
As part of the rollout, the operator has committed to taking its high-speed access services to "smaller towns and communities – and not just the major metropolitan centres."
The executive in charge of the project, head of Broadband Services Erik Hallberg, says a mixture of technologies will be used, where appropriate, including point-to-point fiber, PON, and VDSL2 from existing local exchanges. He notes, though, that TeliaSonera has no plans to deploy remote DSLAMs in street cabinets as part of a fiber-to-the-curb topology: He says the carrier will take fiber all the way to buildings when it decides to use FTTx technology.
In addition, he says the broadband upgrade will also necessitate additional capacity in the carrier's metro networks and core.
Hallberg wouldn't reveal the carrier's capex plans but said the investment was necessary to protect the carrier's group cashflow, most of which comes from its Swedish operations.
Even though it's not known how many of the planned 1.5 million to 2 million homes and businesses will have a fiber access connection, with the current average fiber access connection costs in Europe running at around €1,500 (US$2,340) per household, and with optical and IP upgrades required, too, the project is likely to cost the carrier up to €1 billion ($1.55 billion) or even more.
Hallberg says the carrier plans to forge frame agreements with a number of vendors this year but that no supplier decisions have yet been made.
— Ray Le Maistre, International News Editor, Light Reading