The speed battle in Germany's broadband market is shaping up to be one of the most closely fought in Europe.
Peeved that Germany's cable operators have continued to nibble away at its market share by offering higher-speed services, Deutsche Telekom has launched a vectoring-led counterattack and has already stemmed its customer losses. But the chief threat is now coming from familiar foe Vodafone, emboldened by its recent takeover of cable supremo Kabel Deutschland. (See Fiber Revival at Deutsche Telekom.)
In a recent interview with Bloomberg, Jens Schulte-Bockum, the head of Vodafone's German business, said the operator was preparing to launch a 200 Mbit/s service in November, twice the connection speed that Deutsche Telekom can support with its vectoring-enabled VDSL network. A Vodafone spokesperson has confirmed to Light Reading that Vodafone will rely on Kabel Deutschland's cable technology to provide this high-speed service, making it available to 3 million customers by the middle of next year. (See Vectoring: Some Va-Va-Voom for VDSL.)
This must have come as a major blow to the German incumbent, whose broadband strategy largely involves beating the cable operators on connection speed. Although vectoring will provide some boost, Deutsche Telekom is also looking to a 'hybrid router' -- set to be introduced commercially around the same time as Vodafone's 200 Mbit/s service -- to supercharge its broadband connections by combining fiber and 4G technologies. But it's doubtful this technology will give Deutsche Telekom the advantage it craves.
The router works, as the operator describes it, "by merging the existing bandwidth [of fiber and 4G, allowing] customers… to experience new top speeds that are not possible in the respective standalone versions." When Deutsche Telekom first unveiled its current broadband strategy in December 2012, Niek Jan van Damme, who heads up the German business, told investors the router would support connection speeds of up to 200 Mbit/s, but this figure was increased to 250 Mbit/s in March.
Curiously, though, any speed references were entirely absent from Deutsche Telekom's latest router-related announcement in September, and Light Reading has been unable to get a straight answer from the operator on this subject. "The focus of hybrid is to accelerate existing landlines," is all a spokesperson would say, indicating the operator will publish information about tariffs and maximum speeds this autumn.
The same spokesperson did acknowledge, however, that "hybrid, vectoring and hybrid based on vectoring are strong weapons against cable operators." If the operator fails to make good on at least the 200 Mbit/s promise, investors may demand to know what other weapons it has at its disposal. Several European incumbents, including BT and Swisscom, have flagged their interest in using G.fast to crank up connection speeds -- and new G.fast chipsets have just hit the market -- but the Deutsche Telekom spokesperson says "it is too early to speak about concrete plans" in this area. (See Sckipio Turns Up the G.fast Volume, G.fast: The Dawn of Gigabit Copper? and BT Takes a Step Closer to G.fast.)
Even if hybrid turns out to be a humdinger, Deutsche Telekom seems unlikely to have a monopoly over its use. The operator insists that its hybrid technology is "proprietary," with China's Huawei providing the router, but Vodafone's Spanish subsidiary has begun piloting a technology it calls "DSL/4G bonding" that also appears to work by combining ADSL or VDSL bandwidth with that from 4G. No prizes for guessing which equipment maker is supplying the router.
"Hybrid is Deutsche Telekom's top innovation in 2014," says Deutsche Telekom's spokesperson. If that’s the best it can do, its broadband revival could be short-lived.
— Iain Morris, Site Editor, Ultra-Broadband