Cable Tech

Pining for PON

ATLANTA -- OFC 2003 -- North American carriers here at the OFC Conference may not be joking when they say, "No PON intended."

PON -- passive optical network -- the transmission technology that uses splitters to fan out a fiber transmission line to as many as 64 end points, is still more expensive than some carriers would like, though they appreciate PON's simplicity.

One PON fan is Bill Smith, BellSouth Corp.'s (NYSE: BLS) chief product development and technology officer. "I love the PON architecture," he says. "Anytime you can remove active components from a solution you've done a good day's work." Smith, however, acknowledges that right now American service providers such as BellSouth are having trouble getting PON installed at costs lower than fiber to the home or fiber to the curb.

In Asia, however, manufacturing costs are lower, and PON appears to be picking up speed in at least one major service provider network.

Hitachi Telecom (USA) Inc. is here at OFC, happily chatting up its success with a recent PON equipment installation inside NTT Communications Corp.'s network. Hitachi's AMN1200 systems, which are developed along with NTT, extends LAN segments up to 20 kilometers beyond a remote access office or central office.

NTT began deploying Hitachi's PON gear in September 2002, and they already have more than 60,000 PON systems deployed, serving about 100,000 residential and small business subscribers, according to David Foote, Hitachi Telecom's chief technology officer. Another 100,000 subscribers are expected by midsummer, he says.

Foote says Hitachi is not yet sure whether it will begin selling the AMN1200 in North America. Some service providers might want to add features or make adjustments to the central office unit, which takes singlemode fiber in and spits out several 100-Mbit/s broadband access lines. If Hitachi can leave the box as is, it can take advantage of the already low manufacturing costs it sees after having produced more than 100,000 units in Japan.

Like BellSouth, Hitachi's service provider customers also want as many last-mile options as they can get for as little money as possible. That helps explain why another Hitachi subsidiary, Hitachi Kokusai Electric Ltd., is expected to sign an original equipment manufacturer (OEM) agreement with Wave7 Optics Inc. sometime in the next week, according to Emmanuel Vella, Wave7's chief marketing officer.

Wave7's technology is marketed as a PON alternative, employing active components to extend a fiber network's reach to cover a distance of up to 70 km between a hub and an end subscriber. Hitachi Kokusai is a distributor of the Wave7 Optics Last Mile Link products in Japan and Korea. But the new arrangement would have Hitachi manufacturing Wave7's gear under a private label, possibly giving the technology more pickup worldwide.

Meanwhile, back in the U.S., where PON faces a crisis of cost, Wave7 says it is close to signing a contract with a large utility in the Southeast to be a part of a PON network that will pass 30,000 homes. Vella says Wave7 signed the deal about a month ago and the build-out should start around the third quarter of this year. Wave7 will likely announce the deal at Supercomm 2003.

— Phil Harvey, Senior Editor, Light Reading

For up-to-date information about the OFC Conference, please visit Light Reading’s Unauthorized OFC Preview Site.

optical Mike 12/5/2012 | 12:21:58 AM
re: Pining for PON On the heels of the FCC's triennial review of unbundled network elements (UNEs), Verizon today announced a major broadband initiative designed to make 10 million more access lines DSL-capable by the end of the year and to deploy fiber to the home starting in 2004.

optodunce 12/5/2012 | 12:21:46 AM
re: Pining for PON I sincerely wish that while penning articles that reference cost profiles, it would be helpful to include ball parks costs relative to the products discussed.

example: PON makers such as (optical solutions, QB, etc,) claim a fully populated rack serving 1000 subscribers is about $1,500 per subscriber including the demarc box. With a performance of about 10 mps data 2 voice lines and 200 video channels...

Hitachi claims their low cost solution is about 30 % than existing providers!!!

It would give more validity to your article.

So...what are the numbers!
Accelerated Photon 12/4/2012 | 11:57:05 PM
re: Pining for PON Telecommunications industry forces outside the access market are driving down the price of FTTH, and for the first time it has achieved parity with competing architectures like DSL and HFC. Optical component pricing fell dramatically as backbone fiber was deployed in volume in recent years. Both fiber cable itself, and fiber installation resources are highly available right now, further driving down price. Cost reduction factors that various network elements have undergone follow:

Cost reductions
Component % Cost Reduction

Splitters/Couplers 55%
Splicing 50%
Cable 30%
Photonics 60%
Labor 25%

Fiber is the future, and PON is the most cost-effective architecture available
Sign In