This document discusses strategies for rolling out fiber-to-the-home (FTTH) networks in rural areas. It provides examples of successful FTTH projects in rural communities in Austria and Germany where local municipalities partnered with private companies. Public bodies play a key role in enabling small rural FTTH projects by using existing infrastructure, directly deploying open access networks, and aggregating demand from local consumers and businesses. Challenges include reactions from incumbent telecom providers and ensuring financial viability.

1. FTTH Rollout in
Contact:
Rural areas
Roland Montagne Make it possible
+33 (0)6 80 85 04 80 Broadband MEA, Dubai, 25th March 2012
r.montagne@idate.org
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2. Contents
• FTTx Watch Service : Presentation
• FTTx Worldwide Status & Strategies
• FTTH Rollout in Rural Areas: Study cases
• How make FTTH possible in Rural areas?
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3. FTTx Watch Service : Presentation
Our FTTx Watch Service is specifically designed to provide operators, vendors,
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of the issues that impact the markets:
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4. FTTx Worldwide Status & Strategies
Figures
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5. FTTH/B Global Picture: APAC Strong leadership
FTTH/B subs worldwide from June 2010 …
FTTx means FTTH/FTTB,
FTTN+VDSL,TTLA, FTTx+LAN
6.7 M
6M
0.25 M 30.7 M
Global FTTx market: 112 M subscribers at
June 2011, 61% being FTTH/B
• Asia is still the leading market … to June 2011
(73% of worldwide FTTH/B
subscribers at June 2011)
• Europe, including Russia, is
progressing, in particular thanks 10.2 M
to Eastern countries (~ 15% of 7.3 M
worldwide FTTH/B subscribers
at June 2011) ~ 0.4 M 49.5 M
• USA: a little slow down in
deployment from telcos in 1H11,
but acceleration from local <0.3 M
authorities due to the Stimulus
BB program awards
• LATAM and Middle East
potential Source: IDATE
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6. FTTH/B Global Picture: APAC Strong leadership
Top 10 FTTx players worldwide at June 2011
Rank Player Country Technology & architecture FTTx subscribers
1 China Telecom (*) China FTTH & FTTx/LAN EPON LAN/DSL 22 000 000
2 China Unicom (**) China FTTH/B GEPON/EPON & FTTx/LAN 16 000 000
3 NTT Japan FTTH/B GEPON 15 426 000
4 China Mobile (***) China FTTH/B GEPON/EPON & FTTx/LAN 6 800 000
5 KT South Korea FTTB EPON/GEPON 5 380 000
6 Verizon USA FTTH BPON/GPON 4 478 000
7 AT&T USA FTTN/VDSL2 4 100 000
8 ER Telecom Russia FTTB 3 200 000
9 Chunghwa Telecom Taiwan FTTB GEPON 2 197 000
10 KDDI Japan FTTH/B EPON/GEPON 1 867 000
(*) Among which 7 million FTTH/B subscribers and 13 million FTTx/LAN subscribers
(**) Among which 5.5 million FTTB subscribers and 9.5 million FTTx/LAN subscribers Source: IDATE
7 Asian telcos among the 10 leading players worldwide
2 Chinese operators leading the ranking!
1 Operator from Russia
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7. FTTx Worldwide Status & Strategies
Leaders
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8. FTTH: Worldwide Status & Strategies: leaders
Japan: the FTTH leader
• More new FTTH/B subscribers than new DSL subscribers since April 2005
• Nearly 20.8 Million FTTH/B subscribers at June 2011 and 46 Million Homes
Passed... 1 million new FTTH subscribers last 6 months …. Nearly 40% are FTTB
subs
• At June 2011, FTTH/B subscribers represent 60% of total Broadband subscribers and
more than 90% of the population is already covered!
• Attractive prices, closing the gap with ADSL tariffs… aerial deployments
• Government’s proactive approach to FTTH deployments: 30 million FTTH subscribers in
2010 as a ambitious initial objective…objective revised in November 2007 at 20 Million
FTTH subscribers in 2010…has been reached!
• But not specific services….
….with a few IPTV subscribers in Japan (probably around than 1.5 million)
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9. FTTH: Worldwide Status & Strategies: leaders
USA: FTTH is the unique solution for RBOC’s
• Power of Cable operators: Time Warner, Comcast, launching 30 or 50 Mbps offers
• CableVision proposing a 101 Mbps offer … more than twice what Verizon's much-
touted FiOS offers (50/20 Mbps)
• At June 2011, Verizon has nearly signed 4.5 Million FiOS FTTH subscribers and
has about 3.8 Million FiOS TV subscribers
• At June 2011, the FiOS network on commitment to pass 18 million premises (15.7
passed to date) or approximately 60 percent of total households in areas currently
covered by Verizon’s wireline network (objective is to reach 70%)
• Initial Target: 18 million homes passed by 2010, has not been reached …Now LTE
is being deployed
• AT&T (FTTN oriented) and Verizon launched Fibre access for delivering HDTV &
Triple Play
• Churn is very low for FiOS TV Subscribers: around 1%
• 2Q11: FiOS ARPU ~ $150
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10. FTTH: Worldwide Status & Strategies: leaders
USA: FiOS TV Packaging & Pricing – Example
FiOS TV plans (April 2011)
Source: Verizon – April 2011
Verizon claims now to be the 6th largest cable operator in the USA
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11. FTTH Rollout in Rural Areas: Study cases
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12. ARGE Glasfaser Waldviertel: Austria (1/2)
A trio of small villages in the northeast of Austria have installed a
community-owned FTTH network
• The story begins in 2003 when community leaders recognized that they had a problem of
high unemployment and a declining population.
• The incumbent, Austria Telecom, was not planning to serve such small communities even
with ADSL, so the mayors decided to take matters into their own hands by laying fibre-optic
cable to every property. Installation begun in 2005 and was achieved in 2011.
• Thus ARGE Glasfaser Waldviertel was created, which translates as “Forest Quarter Fibre
Co-operative”. Each municipality owns its own duct and dark fibre, but by working together
the 3 towns have been able to share knowledge, experiences and gain economies of scale.
• The project was able to take advantage of planned work on the sewage system to install
ducts for a fibre network in the same trench as the new sewer pipes.
• The total cost of the network is under €1 million and other nearby villages are interested in
connecting to the network. Local farmers helped to lay more fibre between the 3 towns so
that the three communities could network with each other.
• Today the fibre network passes more than 1,650 homes and small businesses, of which
around 400 are receiving services over the network (end 2011 figures).
• Technology is Active Ethernet with 4 virtual LANs per customer. As national ISPs weren’t
interested in doing business because of the small number of subs., the 3 munis joined
forces with a regional ISP called WVNET to form an independent company that now
operates on the network and offers broadband, VOIP services and IPTV.
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13. ARGE Glasfaser Waldviertel: Austria (2/2)
A trio of small villages in the northeast of Austria have installed a
community-owned FTTH network
• Main challenge is to get a reasonably priced high speed due to necessary connection to the
internet exchange.
• Suddenly, after the first FTTH customers were connected, Telekom Austria decided to bring
ADSL to the villages of the region, and a small wireless ISP (EVN) owned by the power
utility company started offering services locally.
• “The interesting thing was that a lot of the people in the municipalities said ‘It’s nice that
Telekom Austria and EVN suddenly come and offer us something, but we are no longer
interested because we have our own network’,” said Peter Höbarth, Mayor of St. Martin.
13 Source: FTTH Council Europe
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14. Oberhausen: Germany
Thanks to exemplary Public Private Partnership, Bavarian municipality
builds its own FTTH network – Unser Ortsnetz-Oberhausen (our Local
Network)
• The poorly connected municipality of Oberhausen was not satisfied with the offer from
Deutsche Telekom and Kabel Deutschland and then decided to act.
• In June 2009, the town council decided to make a European-wide call for tender for the
deployment of an FTTH network with data rates of at least 50 Mbps for all households. The
tender specification required non-discriminatory and technology neutral access to the
network for third parties, as well as a detailed financial model.
• A precondition for starting the deployment was a minimum take rate of 75% for these 1,150
households of the village. About 70 inhabitants from the village committed themselves
to promote FTTH services.
• About €4 million was financed by Raiffeisenbank
• Ehekirchen-Oberhausen, a co-operative bank,
• to set up a Public Private Partnership.
• Out of a total of 1,150 homes passed
• 1050 are connected to FTTH in Oberhausen
14 Source: FTTH Council Europe
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15. How make FTTH possible in Rural areas?
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16. Public Bodies are key for small rural FTTH Projects
► In Europe, municipalities and power companies are still the main
type of player involved in FTTH/B rollouts, in terms of the number of
projects – accounting for 49% of deployments at the end of 2009
► Local authorities can use several forms of leverage in particular to
enable FTTH deployments
• The first solution, which is aimed at reducing the civil engineering costs of an FTTH
network rollout, consists of using existing infrastructure and cable paths that fall under
the local authority’s responsibility.
• When a local authority has a specific broadband or FTTH rollout strategy in place, it can
even deploy active or passive FTTH infrastructure itself, using an open access model:
either directly or through an intermediary, which could be a power company or a housing
company under its control
• The Local Bodies can act as an aggregator of demand (Public sites, Consumers,
Enterprises) as well as a prime negotiator for financing plan under PPP approach
► Challenges ahead for Local Bodies
• Challenge could be either intrinsic to the local authority as the result of reactions from
existing telecom carriers or cable companies, or even be due to state legislation – as is
often the case in the US.
• Some public power companies that elected to go into the business of supplying FTTH
access underestimated the difficulties of the profession, and their initiative ended in
failure (e.g. Dong Energy in Denmark).
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