SBC Picks Alcatel for FTTP

SBC Communications Inc. (NYSE: SBC) says it has picked Alcatel SA (NYSE: ALA; Paris: CGEP:PA) to be its fiber to the premises (FTTP) equipment supplier, after a six-month evaluation that started from the three-carrier request for proposal (RFP) issued this summer (see RBOCs Hungry for Fiber and SBC Picks Alcatel for FTTH). But don't let the tearful smile and rose bouquet fool you. Second runnerup is never as much fun as wearing the jeweled tiara.

The deal is a good endorsement for Alcatel's gear, but observers say it's not as a strong as the Advanced Fibre Communications Inc. (AFC) (Nasdaq: AFCI) victory at Verizon Communications Inc. (NYSE: VZ), the incumbent carrier that seems the most serious about embracing FTTP (see How Big Is FTTP for AFC? ). All things being equal, FTTP is the premier method of residential bandwidth access, as it offers more bandwidth per user than most flavors of DSL and cable access. Fiber maker Corning Inc. (NYSE: GLW) told Light Reading Insider in November that singlemode fiber has 31 times the capacity of coaxial cable on 100-meter links, and over 250 times the capacity of high-end twisted-pair copper over those lengths.

Unfortunately, all things aren't equal and it's unclear how committed SBC really is to FTTP (see SBC Ratchets Up PON Politics). For Alcatel, which is already a key access equipment supplier to SBC, this win may be more symbolic than substantial.

"Alcatel's already got most of the [third generation] DLC business in SBC," says Millennium Marketing founder Kermit Ross. "And, SBC doesn't appear to be nearly as fired up about doing FTTP as Verizon."

Alcatel's FTTP success in SBC will also depend on the carrier's devotion to DSL. In 2004, 80 percent of homes and businesses in SBC's territory will be passed by DSL. The company added 365,000 DSL subscribers during the third quarter, giving it 3.1 million subscribers in all. With growth like that, it's easy to see why SBC itself is blowing cold on FTTP (see Broadband Growth Is Brisk).

SBC has more copper in its network than many of the other RBOCs, according to Ross. "They will have to put a lot more fiber infrastructure in place to do anything significant with FTTP," he says. That would put a lot of money at risk for an uncertain return (see IDC Sees Modest FTTP Growth).

The FTTP activity in SBC's network to date has been isolated. SBC uses Alcatel's gear in its only FTTP network, San Francisco's Mission Bay community. That development now has 175 residential subscribers and will someday include nearly 6,000 residential units.

Something has to be said for Alcatel not losing the business to another vendor. Mike Quigley, president of Alcatel North America is calling the four-year primary agreement a "significant win," according to a company spokeswoman. Alcatel says SBC has shared its deployment plans with the vendor, but they're not allowed to discuss them.

Even if SBC's FTTP deployment plans are tough to nail down, the choice of Alcatel as a primary supplier could mean additional revenues for Alcatel's voice partner General Bandwidth Inc. and its CPE partner Carrier Access Corp. (Nasdaq: CACS).

All Alcatel can say for sure is that in-depth lab testing of its gear will begin and field trials of the technology are set to begin in the first half of 2004.

Oh, and that it was an honor just to compete for the crown.

— Phil Harvey, Senior Editor, Light Reading

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bonnyman 12/4/2012 | 11:10:16 PM
re: SBC Picks Alcatel for FTTP No rumors, but a BellSouth spokesman is quoted as saying they'll have no decision in the near future:

ecipo 12/4/2012 | 11:10:16 PM
re: SBC Picks Alcatel for FTTP about the BellSouth?
Accelerated Photon 12/4/2012 | 11:10:15 PM
re: SBC Picks Alcatel for FTTP I don't know much about rumors but I do know a fact, Alcatel and Optical Solutions FTTH products spent the good part of a year in the Sprint Labs in Kansas City. Notice the Sprint Label on the page http://www.opticalsolutions.co...
The word from the lab was that Optical Solutions product set the bar for performance.
Now what does SBC know that Sprint overlooked or is it all about the $$$ foreword pricing today in hope of making it up by volume in the future? Or Verizon's decision of AFC one of the few RFP respondents who I had heard didnGÇÖt have a product ready for evaluation for the scheduled lab trials, that may have been a conscious decision in order stall any mass deployment though.
Iipoed 12/4/2012 | 11:10:14 PM
re: SBC Picks Alcatel for FTTP sofa- so your point is?
Sofa-kingdom 12/4/2012 | 11:10:14 PM
re: SBC Picks Alcatel for FTTP SBC picks Alcatel for FTTP...who cares???
That's about as meaningful as Melissa Etheridge or KD Lang picking a meat supplier.

For those that don't know, both those women are........vegetarians--in more ways than one!
dispersion compensator 12/4/2012 | 11:10:14 PM
re: SBC Picks Alcatel for FTTP My money's on Motorola/Quantum Bridge. They're the third vendor(s) in the FTTP triumvirate. BLS will pick them and then the Bells will have an FTTP bake-off between AFC, Alcatel and M/QB.
Lite Rock 12/4/2012 | 11:10:10 PM
re: SBC Picks Alcatel for FTTP sofa- so your point is?

Yeah, what does them being vagitarians have to do with FTTP never getting mass deployment?

What about FTTG, FTTT,ETC...?
ftthexpert 12/4/2012 | 11:10:10 PM
re: SBC Picks Alcatel for FTTP Sprint - My feeling that sprint will evantually pick their incumbant vendor for FTTH as this one is ready with it. They will follow the same logic that Verizon made.
Bell South - Many rumors that Nortel and Catena are the favorites for Bell South FTTC/FTTB PON plans. The same reason QB/MOT was not selected by Verizon/SBC will stand with BLS. They have a good PON performance but they are new in town.
SBC - Some are saying Entrisphere/Fujitsue has a magic to penetrate the SBC networks with their FTTP and Broadband offering
Bell Canada and Telus - Does anybody knows are serious they are with PON ?
BobbyMax 12/4/2012 | 11:10:09 PM
re: SBC Picks Alcatel for FTTP With the exception of vERIZOn that good concentration of poulation and may be a good choice for the FTTP technology. But Bell South, Qwest and SBC simply cannot afford the cost of the FTTP deployment. All broadband services can be provided over the DSL network.
canttakemore 12/4/2012 | 11:10:05 PM
re: SBC Picks Alcatel for FTTP
With all bid vendors bagging the deals, wondering what will happen to start ups that are trying to sell FTTP products to SBC/Verizon ??
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