[Satellite News 09-07-10] Global telecoms, media and IT adviser Analysys Mason released a report Sept. 7 urging operators to reconsider plans for fiber to the home (FTTH) if they are costly and focus on copper-based technologies.
    The report, which analyzes FTTH roll-out and capex in developed economies over the next five years asserts that the wireless devices and services market will continue to capture new consumers, justifying investments telecoms have made in a product that has a rapid rate of innovation. However, the report said that this growth has made it more difficult for fixed operators because overall consumer spending on telecoms has ceased to grow in developed markets due to the lagging economy.
    “FTTH is often said to be ‘future-proof’, but the future appears to have veered off in a different direction,” said Rupert Wood, Principal Analyst at Analysys Mason and author of the report, “Many cable operators have been offering superfast fixed broadband connectivity for some time in Europe and North America, but take-up remains troublingly low.”
    Arabsat CEO Khalid Balkheyour, who serves both developed and emerging markets in the Middle East, is one operator that has been wary of FTTH’s potential. “(FTTH) to the end user is not a very viable option right now, at least on a large scale. I don’t think there will be much of a massive impact in the near future. However, when IPTV eventually takes off in some geographically restricted niche markets, where either the copper network is good enough to support such high profile xDSL services or FTTH will be made available faster than originally expected, like a specific city or a small state, satellite still has a beautiful central enabler role to play as the most economically efficient way to feed content into the headends [digital subscriber line access multiplexer]. This has been demonstrated in many European countries where this business model has recently taken off.”
    Wood suggests that companies in economic environments where governments have to reduce their levels of borrowing, should reduce, or rethink, their long-term commitments to fiber roll-outs as next-generation access investments could be perceived as politically awkward or even inappropriate in markets where budgets for education, health and social welfare are being cut.
    “The vague promise of future services may appeal to some early FTTH adopters, but will become increasingly ineffective as a selling point unless the rate of innovation in devices and services that are uniquely suitable for FTTH gets some new impetus from vendors and service providers. The future cannot be simply plotted against increasing fixed-line bandwidth,” said Wood.
    Instead of giving up on fiber completely, Analysis Mason recommends that operators should trial FTTH while focusing on less-expensive copper-based technologies, such as VDSL. “Conditions vary between markets, but in general the business case to move much beyond trials just isn’t there and we are already beginning to see some scale-back,” said Wood. “Bandwidth demand for fixed broadband is converging with the bandwidth required to stream TV, and its rate of growth will slow down. VDSL might not be able to meet these demands at some point in the future, but we believe that this point is still a long way off.”