TDC Targets Enterprise Market With Its Gigabit Upgrade
LONDON -- Danish national operator TDC believes it can secure and grow its consumer broadband business and develop additional revenue opportunities in the business services market by upgrading its cable network to DOCSIS 3.1, executives from the operator stated at a press conference in London Wednesday.
Having reviewed various options for its broadband access network, including a shelved plan to outsource the whole lot, TDC A/S (Copenhagen: TDC) has decided to upgrade the cable broadband network that services 1.3 million Danish homes (half of the country's total) to DOCSIS 3.1 and offer Gigabit broadband services to every one of its customers. (See Eurobites: TDC Goes Gigabit With Huawei.)
It's likely that TDC will be the first cable network operator in Europe with a significant countrywide DOCSIS 3.1 deployment (albeit in a relatively small country -- Denmark has a population of about 5.7 million).
The operator is currently operating a DOCSIS 3.0 cable broadband network that enables it to provide downstream speeds of 300 Mbit/s under its YouSee brand. The upgrade will mean it can offer Gigabit downstream and 500 Mbit/s upstream. "Gigabit is the speed of the future -- it will enable customers to do whatever they want," stated TDC's chief operating officer, Peter Schleidt. "It's also a little bit of a defensive move -- this will be good for customer retention. We don't expect a lot of people to sign up for Gigabit services straight away -- only a small percentage have taken our current 300 Mbit/s option -- but it means they can move up to a faster speed easily when they need to," he noted.
That may be slightly defensive -- TDC competes with a smaller cable competitor, Telia Stofa (about 400,000 homes) -- but the upgrade also offers growth opportunities. In addition to 200,000 homes that currently only take TV services but not cable broadband from TDC, it also has high hopes for selling broadband services to small and medium-sized enterprises. "There are big commercial opportunities [in the business services market]," noted Schleidt. "Historically we haven't offered broadband to business users over our cable network because the infrastructure has always been coupled with TV, but with this upgrade we'll be able to offer a data-only service," he added.
TDC's technology partner for the upgrade is Huawei Technologies Co. Ltd. , a long-time partner that also supplied the network infrastructure for the operator's mobile network. (See Huawei Clears Danish Security to Oust Ericsson.)
The Chinese vendor was selected because it is a trusted partner, has advanced DOCSIS 3.1 technology and is further ahead in getting its technology certified, noted TDC's CTO Carsten Bryder, who added that other suppliers had been considered. (See TDC & Huawei Team on D3.1 Field Test.)
Could Huawei also be providing an economically competitive solution? Neither the vendor nor the operator would provide any financial details of the upgrade or associated contract. TDC's Schleidt noted that the upgrade from the existing DOCSIS 3.0 network to 3.1, which will start in the fourth quarter of this year and be completed by the end of 2017, will be managed within the operator's historical capex limits and is cost-effective as the existing cable plant can be re-used.
Schleidt was quick to add that rolling out a fiber-to-the-home network to offer Gigabit broadband in the areas where it has its cable network would cost eight times as much.
TDC's DOCSIS 3.1 ambitions might not be limited to Denmark: It also owns a cable operation in Norway and "we have the opportunity to do the same sort of upgrade there," noted Schleidt. If that happens, expect Huawei to be the vendor partner of choice once again.
— Ray Le Maistre, , Editor-in-Chief, Light Reading