Transcript An International perspective on the status of Fibre

An International perspective on the status of
Fibre investment in the access layer
Stefano Nicoletti
[email protected]
+44 207 551 9178
14/12/2007
© Copyright Ovum 2007
www.ovum.com
Agenda
2

Some figures

FTTx plans

IPTV case studies
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Level 3data on fibre
Some
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FTTP -10 leading countries –subscribers #
8,000
7,000
Subscribers (000s)
6,000
5,000
2005
4,000
2006
3,000
2,000
1,000
N
or
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ay
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Ko
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H
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Ja
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K
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FTTP = FTTH or apartment + Ethernet LAN; VDSL excluded
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FTTP – forecasts to 2011
60%
50%
Korea
Japan
40%
Hong Kong
Sweden
US
30%
Denmark
Russia
Taiwan
20%
Italy
Norway
10%
0%
2005
5
2006
2007
2008
2009
2010
2011
Figures in % of Households; Asia expected to widen the gap
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Non-DSL connection vs FTTP as% of
total broadband
70%
60%
50%
40%
30%
20%
10%
Non-DSL
6
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Ko
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S
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0%
FTTP
Infrastructure competition seems to favour FTTP take-up
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Availability of high-speed services is an
issue
Key
Total Households
Households with copper access
Households that can get DSL
Households that can get DSL @ 2Mbps
Households that can get DSL @ 10Mbps
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Western Europe
North America
Asia Pac
Eastern Europe
Monthly fee relative to monthly disposable
income
% of disposable income
25%
20%
15%
10%
5%
Lowest fee
8
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rw
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N
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T
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nm
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K
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H
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K
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0%
Highest fee
All countries except Russia and Norway have entry product below 3%;
In line with prices of other technologies
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IPTV ‘v’ consumer fixed voice
Hong Kong – most successful IPTV country in the world
1200
1000
Revenue (US$)
800
IPTV revenues
fixed voice revenues
600
400
200
12,000
0
2005
2006
2007
2008
2009
2010
10,000
Revenue (US$)
8,000
IPTV revenues
fixed voice revenues
6,000
4,000
2,000
France – most successful IPTV country in Europe
0
2005
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2006
2007
2008
2009
2010
FTTx plans
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FTTH plans
Country
Operator/aut
hority
FTTH plans
Current subscribers
(Q307)
Korea
MIC
10M subscribers in Korea by 2010.
4.6M
KT
92% homes-passed by 2010 (~16.9M
households). Cumulative CAPEX: FY07- US$435M;
FY08 – US$783M; FY10 – US$1.3B.
2.2M
Hanaro
~US$120M in 2007, targeting 12.6M homes
passed by FY07.
1.3M
Powercomm
Japan
NTT
20M subscriber target for FY2010. US$47B
budgeted for 2006-2010.
7.4M
Hong Kong
HKBN
2M homes passed (95% household coverage) by
2010. Total CAPEX budget for FY08 – US$22.5M.
220,000 (Q207)
Verizon
18M homes passed by 2010. US$23B for 20062010, however this does not take account of a
US$4. 9 B that would otherwise be required to
maintain traditional copper plant during the same
period.
1.3M
DCA
Est. US$1.3B by municipals, for a targeted 1M
subscribers.
US
Denmark
Source: Ovum research
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820k
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Korea and Japan
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U-Japan (ubiquitous Japan)
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2006-10 program by MIC, revised every year
Eliminate “zero broadband coverage” towns and villages by 2008
High speed broadband to cover 90% of population by 2010
Support investment through funding, tax relief, loans
Support competition through open access to poles, ducts and physical infrastructure
KII- Korean information Infrastructure
 Plan started in 1995
 As of 2000 –Govt and operators invested W11trillion
 Broadband development in rural areas a main objective, KT forced to roll-out
coverage in remote villages
 Incentives to invest through cheaper finance or extended loans
Govt objectives to remove digital divide AS WELL AS improve broadband speed
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Australia, Singapore, UK…public money
on the way!
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New Australian Labour govt.– broadband to the bush 
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AUS $4.7billion ($4.1bn) to invest in FTTN infrastructure and cover 98%
Public private partnerships
Tender process to allocate the money: Telstra, G9 consortium, Deutsche Telekom; 6 months only!
Doubling Telstra money announced in its investment plan in 2005
UK – Stephen Timms – new minister for competitiveness
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“Ultra-fast broadband …will allow our businesses to innovate, grow and create wealth. We need
to be discussing today how we can put this new network into place, because delay could be a
barrier to the future success of our economy.”
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Estimated cost for FTTH in UK = £ 15 bn; FTTN £7bn (respectively 30 and 14bn$)
Singapore Government and two new RFPs
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Netco to build and operate a Layer 1 passive infrastructure
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Public funding for S$750mln ($520 mln)
Operating co.(Opco) to deploy electronics, switches and routers, and offer wholesale broadband
access to downstream Service provider
Public money for FTTN and infrastructure upgrades is coming
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The French fibre race
Wholesale DSL
LLU
FT retail
Source: Ovum research
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Aggressive plans from incumbents as well as competitors
 Unique situation in Europe
 Re-use of public infrastructure essential (e.g. Paris, Marseille)
 Early start of LLU empowered competitors and provides financial
strength for stepping the last step of investment ladder
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KPN and its NGA plan
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KPN announces an all-IP investment plan in November 2005
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From 21 local exchanges;1350MDF;28.000 street cabinets…
…to14 central locations,150 Metro core exchanges, 24.000 street cabinets
…and replacing copper with fibre in between the MDF and the street cabinets
Plan To be carried out within 2011
This means
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LLU will disappear (2011 but optimistic) and Sub loop unbundling will be introduced
OPTA taking into account SDF investment but also
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Revenues for selling MDF locations
Savings from announced dismissal of 8,000 work force (about ¼ of KPN!!)
Future
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prices for SDF expected to be in line with current MDF- Full LLU/Shared access
OPTA assumes a 5 year pay back period for OAOs business cases for MDF, they have
opened a consultation and received business cases whose life span was 3-5 years.
A minimum of 2 years for phasing out exchanges
Functional separation ruled out
Is there a case for SDF access? OPTA considers option must be given
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ADSL v FTTCab v FTTP
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To deliver TV service over:
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ADSL from the exchange: ~$200 per year
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FTTCab: additional investment of ~$900*
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FTTH: additional investment of ~$1,800*
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If ROI is over a 3 year period, that is $25 and $50 per month
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In some cases FTTx brings cost savings in other areas
 Reduction in opex
 Reduction in churn
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* Based on Ovum’s modelling and operator financial reports
IPTV Case studies
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Verizon – throwing technology at the
problem
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Fios TV built on FTTH technology
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8.5 million homes passed, 18 million
targeted by 2010.
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As over Q3 2007, 717 thousand
Fios TV customers
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Probably the most technically advanced
TV service in the world
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Largest choice of HDTV channels
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multi room PVR, up to 6 separate remote terminals
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Video on demand, tV channels, pictures
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Competes on price, quality, package
flexibility and functionality , the whole package for around 60$ (different options
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80% of Fios TV customers take triple play package
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Pick and mix menu: basic package, plus premium entertainment, plus hardware
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Now TV – a true media company
- ARPU has increased from HK$57 to
HK$166 in 3.5 years
- 68% are pay TV customers
- First to introduce HDTV
- Quickly catching the competition
900
800
TV subscribers (000s)
700
- Exclusive content rights: UK Premier
600
league, UEFA 2008,etc.
500
PCCW
i-cable
400
-7 channels delivered on PCCW’s
quadplay
200
100
0
2004 H1
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- Flexible payTV channels
300
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2004 H2
2005 H1
2005 H2
2006 H1
2006 H2
2007 H1
-- pricing in between 20 -80 $ depending
on the package
Creating interactive services around
premium content
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Sports Barker – viewers can watch promotional videos of
sports programming and view live match fixtures of all now
SPORTS channels
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Live Match Info – head-to-head statistics, team line-up, player
profiles, team fixtures,
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Live match scores of all games available
at a glance
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Player-of-the-Match Voting – instant
voting and results available
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“The future is Orange”
21
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Build on existing satellite
content
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Expand to multi-screen
experience
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Expand into content creation
and production

Expand into consumer
electronics
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Thank you !!
Stefano Nicoletti
[email protected]
+44 207 551 9178
14/12/2007
© Copyright Ovum 2007
www.ovum.com
Non -Network neutrality al Grand hotel
Brun!
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