FTTP - On-Demand

Indie Telco Local Content Workshop advertisement

FTTP - On-Demand

by Ken Pyle (ken.pyle@viodi.com), Viodi, LLC

April 28th, 2004 Issue

Tom Soroka, USTA's Director of Technology and Engineering set the stage for USTA’s webinar, The Triple Play: FTTP. Soroka discussed some of the regulatory and business challenges faced by carriers as they decide to deployed Fiber to the Premise (FTTP) networks.

Soroka briefly discussed last year’s FCC’s Triennial review that the FCC said that telcos would not have to unbundle elements of new broadband networks (e.g. fiber to the premise). A question that Soroka did not come up was the one that I asked in the last issue of the last Viodi View. Should telcos be supporting the cable industry in their legal efforts to support the recently overturned FCC rules regarding access to cable modem bandwidth?

He suggested that many carriers may be sitting on the sidelines, waiting for the FCC to make decisions on how fiber impacts the Universal Service Fund. Soroka also pointed out some of the things that have plagued FTTP from the beginning, such as providing back-up power and will the maintenance costs really be less in the long-term. He suggested that carriers are going after low-hanging fruit for FTTP, such as “green field” deployments and business parks where the service revenues can be justified.

Dustin Maier of the Martin Group phoned in from Jamestown, North Dakota, where he is involved with a 6,500 passing, fiber to the premise overbuild project. Maier pointed out that, “we are all in the same industry today”, meaning cable and telcos are to the point where they can each provide the same service set.

Bruce Degn of USTA was listening closely to the April 8th USTA webinar, as he pointed out, and Maier agreed, that telcos getting into the video business need to begin planning and implementing the content portion of a video system simultaneously with the network implementation. Maier stated that he “believes the triple play is required [to justify FTTP]”. His experience suggests that the first one with the triple play seems to win.

Maier had some good suggestions for any telco considering a FTTP deployment including:

Be conservative and accurate on the pro-forma. Don’t forget about the little things. Things like installation costs for inside wiring. He suggested $200 per home for inside wiring. Don’t forget about city and county franchises. The city of Jamestown is requiring $31 per drop for rights of way on the FTTP overbuild project.
Each exchange and application is different, in terms of the cost-effectiveness of FTTP, so each one has to be engineered separately. He went into great detail comparing on a proforma for a fiber versus copper deployment.
FTTP “Future Proofs” the network. It also serves to defend against future incursions by competitors. That is, the competition sees FTTP competitor and they don’t want to go into that particular community..
Generally, there will be a premium for FTTP. Video and Internet will generally offset the premium paid for FTTP.

Maier brought his presentation home by giving some current data on the Jamestown, N.D. project.

Approximately. 6,500 passings for the project.
This is an 18 million dollar overbuild. At present rate of investment, it is 2.5 million dollars below this budget. It is funded by RUS Broadband loan.
They plan on being cashflow positive on day one, while in year two they plan on being net profit positive. The loan gets paid off in 14 years, according to the proforma.

From a cost standpoint, he has actually found cases where FTTP can be less cost. Generally, he has found that FTTP is 20 to 60% higher than traditional copper implementations. These extra costs are primarily due to the cost of the optical NID (Network Interface Device), although it is dependent upon configuration and construction type (e.g. are ducts used).

Trevor Smith of ADC went into some detail on the outside plant architecture required for FTTP. He discussed the details of Passive Optical Networks, specifically centralized and cascaded PON applications. He showed the network architecture of FTTH Communications’ and discussed the choices they made and the lessons learned from that deployment.

To view and listen to the archived presentation, please go to:

http://www.usta.org/webinars.php?urh=home.events.webinars

Back to Main Page