That's the conclusion of the recent Light Reading Insider report, "Next-Gen DSL Deluge," based on interviews with dozens of carriers. The report lists the DSL plans of the major carriers and grades the equipment vendors offering DSL access multiplexers (DSLAMs) and digital loop carriers (DLCs) to build out the DSL infrastructure.
Fiber has the potential to carry much more bandwidth than DSL, but DSL has the advantage of being cheap, because it runs on already installed copper lines. Moreover, consumers may not have reached the point where their usage patterns demand fiber (see Fiber's Sticky Wicket).
The capper is that new DSL technologies are bringing the technology to the level needed for fancy services, streaming video in particular. ADSL2+ promises download speeds as high as 25 Mbit/s, and for shorter reaches -- such as those found in dense Asian cities -- VDSL is promising 100 Mbit/s (see ADSL, Take 2+ and VDSL Races to 100 Mbit/s).
The availability of all that speed "will extend the life of the existing copper plant, and it's already made carriers think twice about upgrades to fiber," says the report, edited by Light Reading U.S. editor Scott Raynovich.
Some carriers are mixing their fiber and DSL diets. SBC Communications Inc. (NYSE: SBC), for example, is preaching a $6 billion strategy where fiber connects to the general neighborhood and DSL brings the connection home (see SBC's $6 Billion Banquet).
Others are harder to read. Verizon Communications Inc. (NYSE: VZ) has voiced plans to fiber up millions of homes during the next year, but its earnings calls have shown continued healthy growth in DSL. Some expect Verizon to scuttle the fiber strategy if certain FCC decisions don't go its way (see Verizon FTTP: Plenty of Exits).
DSL appears poised to lose out to fiber in the long run, at least in North America where VDSL's stunted reach eliminates it from most markets. Among the key long-term considerations is the delivery of high-definition TV over broadband, a service that's going to require multiple streams per residence at 22 Mbit/s per stream. "The jury is still out, however, on whether it's feasible [for copper technology] to push multiple streams of real-time, high-definition digital TV," says the report.
As for which companies are best positioned for the DSL windfall, the Insider report picks the no-brainer Alcatel SA (NYSE: ALA; Paris: CGEP:PA) as the leader, rating the company an "A" on its technology and "B" on its financials (no company earned an "A" for financials). Advanced Fibre Communications Inc. (AFC) (Nasdaq: AFCI) is also a promising player, although it's facing the distraction of a possible acquisition by Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA). (See Tellabs Buys AFC for $1.9 Billion and Honey, I Shrunk the Price.)
Cisco Systems Inc. (Nasdaq: CSCO) hasn't introduced a DLC or pure IP DSLAM, "but it's certainly a company to keep your eye on," the report notes. "If Cisco wants to get serious about DSL and the access markets, it needs to make an acquisition."
Other public companies covered by the report include:
- Adtran Inc. (Nasdaq: ADTN)
- Ciena Corp. (Nasdaq: CIEN)
- ECI Telecom Ltd. (Nasdaq/NM: ECIL)
- Ericsson AB (Nasdaq: ERICY)
- Lucent Technologies Inc. (NYSE: LU)
- Marconi Corp. plc (Nasdaq: MRCIY; London: MONI)
- Motorola Inc. (NYSE: MOT)
- Nortel Networks Ltd. (NYSE/Toronto: NT)
- Occam Networks Inc. (OTC: OCCM)
- Siemens AG (NYSE: SI; Frankfurt: SIE)
- UTStarcom Inc. (Nasdaq: UTSI)
The report also covers private companies, including Allied Telesyn International Inc. and Calix Networks Inc.
— Craig Matsumoto, Senior Editor, Light Reading
For more on this topic, check out:
- The Light Reading Insider report:
— Next-Gen DSL Deluge
For further education, visit the archives of related Light Reading Webinars:
- Next-Gen DSLAMs
- The Role of DSLAMs in Delivering Next-Gen Services
- Third-Gen DLCs: The Secret to Class 5 Switch Replacement
- Access Technologies: Fiber to the Future
- Fiber to the Premises: Closing the Capacity Loop