IDATE DigiWorld - FTTH global perspective 241017 Gigabit VF - Roland Montagne

FTTH Global Perspectives
Toward Gigabit Era
Broadband World Forum – Berlin, October 24th 2017
 Contact
Roland MONTAGNE
Principle Analyst
Director DigiWorld Institute UK
r.montagne@idate.org

www.idate.org © IDATE DigiWorld 2017 – p. 2
1. FTTx Worldwide Key Trends 3
2. Major Players Worldwide 7
3. FTTH…
3.1. ... in Europe 10
3.2. ... in APAC 20
4. Toward Gigabit Era ____________________________________________________________________ 27
Agenda

www.idate.org
1. FTTx Worldwide Key Trends
FTTH Global Perspective

FTTx Worldwide key trends
> Superfast technologies(1) represented nearly 48% of
broadband access subscriptions at end 2016, 9 points more
than one year before.
> FTTH/B is still the leading superfast broadband solution, far
ahead of FTTx/D3.0, followed by VDSL
FTTH/B represented 68% of FTTx subscriptions at end 2016. Growth of
FTTH/B subscriptions will continue until 2021.
FTTx/D3.0 represented at end 2016, 20% of FTTx subscriptions. After two
years of significant growth, proportion of FTTx/D3.0 on Superfast
Broadband is levelling off.
VDSL, for its part, lagged behind, representing 12% of subscriptions at
June 2016 . This proportion is quite stable.
> The regional breakdown is very heterogeneous
No huge changes in the geographical predominance of APAC on the
FTTH/B market.
FTTH/B is also the main deployed technology in MENA. It was the case
also in LATAM, but now it is meeting stronger competition from VDSL
technologies in the region (especially in Brazil).
FTTx/D3.0 is still dominant in North America and is by and large growing
more rapidly than other technologies.
There is considerable space for VDSL and other copper based
technologies such as G.Fast in Europe, where incumbents still wish to
optimise their copper networks.
(1) For the definition of superfast platforms we have considered here three main architectures: FTTH/B,
FTTN and FTTx/D3.0 deployed by cable operators
Breakdown of superfast broadband technologies, as of December 2016
Source: IDATE DigiWorld, World FTTx market, August 2017

Breakdown of Superfast broadband technologies
Geographical breakdown of the three main superfast broadband architectures, at December 2016
VDSL: 62 million subscribers (1) FTTH/B: 342 million subscribers FTTx/D3.0: 101 million subscribers
505 million FTTx
subscribers Worldwide
at end 2016
MEA = Middle East and Africa; LATAM = Latin America; APAC = Asia-Pacific; NA = North America; EUR = Western + Eastern Europe
(1) 11.8 M FTTx°+LAN subscribers in China are not taken into account.

Leading countries, by FTTx solutions at December 2016
> China , leader on worldwide FTTH/B market
Until end-2012, Japan was the most advanced FTTH/B market in the world.
Chinese players are increasingly focused on FTTH/B and, as the largest country in
the world, it will remain the leading market for the near future. The number of
FTTH/B subscribers has already significantly risen since 2014.
China and Japan are followed by Russia, which is ahead of South Korea, while the
USA is ranked 5th worldwide.
Elsewhere in the world it is worth noting that FTTH/B is the only architecture
deployed, such as in Gulf Cooperation Countries (GCC) or the MENA region.
> Strong competition from VDSL technologies in North America,
Europe and also in LATAM
The promise of VDSL-based technologies has convinced several European
incumbents to bet on the potential of their copper networks.
However, as these deployments will concern limited areas, VDSL will not overtake
the two other major FTTx architectures at a worldwide scale.
It can be noted that VDSL is the main architecture deployed in Brazil
(17.2 million homes passed and 3.87 million subscribers) and in Israel (2.3 million
homes passed and 1.5 million subscribers) the only two countries in their own region
to deploy this solution on a large scale.
> FTTx/Docsis 3.0 is the technology implemented by MSOs
The US market is clearly ahead of any other in the world concerning Docsis 3.0.
Cablecos are implementing Docsis 3.0, expanding also fibre closer to homes, in
order to provide higher speed rates. In general, cablecos do not plan to expand their
geographical footprint (with a few exceptions for those who decide to deploy FTTH).
In the coming months they will focus on updating their existing networks with Doscis
3.1. with a few exceptions betting on FTTH.
European MSOs have completed also the upgrade of their networks, thus entering
the Top 5, like Germany and the UK.
"Top 5" FTTH/B countries at December 2016
(‘000 subscribers)
"Top 5" VDSL countries at December 2016
"Top 5" FTTx/D3.0 countries at December 2016

www.idate.org
2. Major players Worldwide

World leading providers, all FTTx architectures
> There are 5 Asian and 3 US players in the global Top 10. Then one player from Russia and one from Western Europe
> Indeed, only one player from Western Europe enters the ranking thanks to its large-scale FTTN+VDSL rollouts (BT)
> Two US cablecos have now completed their infrastructures migration to FTTx/D3.0: Comcast and Charter (Spectrum)
> The Mega merger in USA has taken European cableco Virgin Media out of the TOP 10 chart
> China’s three telcos (China Telecom, China Unicom and China Mobile) top this FTTxranking
106 M subscribers
FTTH/B
4.7 M subscribers
FTTN+VDSL
#9
5.7 M subscribers
FTTH
#10
70 M subscribers
FTTH/B
#2
#1
7.4 M subscribers
FTTB
#8
19.9 M subscribers
FTTH/B
#424.7 M subscribers
FTTx/D3.0
#3
#77.8 M subscribers
FTTH/B
31 M subscribers
FTTH/B
#6
#521.4 M subscribers
FTTx/D3.0

Snapshot of the world’s leading FTTH/B providers
19.9
106
70
7.8
5.7
3.8
3.5
4.6
7.4
31
Worldwide FTTH/B leaders (million), December 2016
3
<1

www.idate.org
3.1. FTTH in Europe

FTTH/B figures at September 2016
There were more than 44.3 million FTTH/B subscribers
and nearly 148 million FTTH/B Homes Passed in EU39 at September 2016
Subscribers = 49%
Home passed = 52%
EU 28
Subscribers = 43%
Home passed =36%
CIS

Historical data and growing trends
•Interesting dynamism of the European Union since 2013
•CIS countries : higher growth rates for subs than for HP between January and September 2016
•Globally: an increase of the growth rate during the first 9 months of 2016! Especially for EU28
Source: IDATE DigiWorld for FTTH Council Europe
Growth of FTTH/B subscribers
(million)
Growth of FTTH/B Homes Passed
(million)
0
5
10
15
20
25
30
35
40
45
50
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Sep-15 Sep-16
EU39
EU28
CIS
0
20
40
60
80
100
120
140
160
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Sep-15 Sep-16
EU39
EU28
CIS

Major projects / categories of players
•400 analyzed FTTH/B projects in EU39 at September 2016:
- There are less and less new projects from one year to another
- All major operators are involved in each country, among which 35 incumbents at least
- There will probably be more and more small players involved in local deployment in the coming years (Rural and
Suburban)
• Incumbents now represent 43% of the total number of Homes Passed
- This ratio was only 21% at end 2011
- Alternative players, which promoted FTTH/B in most countries since 2008-2009, now represent 53% of the total
number of HP; this ratio is increasing
•The market is clearly dominated by those two categories of players.
•But municipalities/Local Authorities, along with utilities when appropriate, will remain those ones that will help ensure
an exhaustive coverage at term
% of Homes Passed per category of player

General ranking: FTTH/B Homes Passed
•17 countries with 2 M HP or more in EU39 (10 countries in EU28, in blue on the map)
•Most significant growth rates do not necessarily concern the largest market but this confirms that, even in
countries where FTTH/B is not the leading NGA solution, the interest is growing (e.g. Bulgaria: +40%)
Countries with 2 M HP or more at Sept 2016 [Top 5 Growth rates for 9 first months 2016]
(million)

General ranking : FTTH/B coverage
Average FTTH/B coverage*: EU39  45%
EU28  33%
(*) Number of HP/total number of Households
Top 10 countries in coverage at September 2016

General ranking: FTTH/B Subscribers
•9 countries with 1 M subscribers or more in EU39 (5 countries in EU28, in red on the map))
•Strong growth in Spain, Belarus, Finland and Portugal
•Dynamism to highlight in France and Italy
Countries with 2 M HP or more at Sept 2016 [Top 5 Growth rates for 9 first months 2016]
(million)

General ranking : FTTH/B take-up rate
Average FTTH/B take up rate (*): EU39  30%
EU28  28%
(*) Take up rate = number of subscribers / number of Homes Passed
Top 10 countries of more than 200 K subs in take-up rate at
September 2016

European ranking
•The European Ranking includes countries of more than 200 K HH where the part of FTTH/B subs in the total
number of HH is at least 1%
•Only 12/31 European countries with a penetration rate > 20%

Key points for Europe
> There already 31 European countries that are part of the Global ranking … a positive sign even if the
bottom line is only 1%.
> Even the “reluctant” countries are moving towards FTTH/B technologies. The historic trend shows this
evolution and there are more countries reaching the 100% of coverage!
> End users are migrating to FTTH networks. But the switch to FTTH/B connection is not systematic yet
and therefore there is still a large room for communication by operators.
> Governments and local authorities are entering the game and the Digital Agenda is one of the main
important objectives to achieve.
•DAE’s main requirements are respected in all EU28 countries
•Local authorities are more dynamic in Scandinavian countries and in France: they should impulse a new
dynamic to reach more rural areas and in countries where FTTH/B is lagging far behind other architectures
•“French Model” as an example for Europe?
> Highest take up rates in Northern and Eastern countries: still strong competition from other
architectures elsewhere.
> Nearly all players, even if less involved in FTTH/B than other architectures, consider that FTTH is the
end game! … and 5G will need Fibre!

www.idate.org
3.2. FTTH in APAC

www.idate.org
FTTH/B is taking a bigger place in the APAC Market due to a positive
evolution in the deployment and specially in the user’s adoption
Source: IDATE for FTTH Council APAC
297.8 million
FTTH/B
subscribers
by Dec. 2016
in APAC
436.5 million
FTTH/B
Homes
Passed by
Dec. 2016 in
APAC
68% growth
from 2015
12.5% growth
from 2015
68%
FTTH/B Take
up rate by
Dec. 2016 in
APAC
> + 20 points from
December 2015
Take up rate = FTTH-B subs / Total FTTH-B Homes Passed

Total FTTH/B Homes Passed by country
The Top-4: China is N0 1 by far due to the size of its market. Even though, countries like Japan, South Korea and
Indonesia have reached 50 or more than 10 million homes passed with FTTH/B networks
Also it can be observed 10 countries that have deployed FTTH/B networks passing more than 1 million homes
7.6 7.5
3.85
3.08
2.8
2.5 2.3 2.28
1.21 1.06
0
1
2
3
4
5
6
7
8
Thailand Taiwan India Australia Kazakhstan Philippines Hong Kong Malaysia Singapore New Zealand
FTTH/BHPMillions
320
52
18 13
0
50
100
150
200
250
300
350
China Japan South Korea Indonesia
FTTH/BHPMillions
Source: IDATE DigiWorld for FTTH Council APAC
The largest market worldwide. Important network overlapping. Coverage higher than gvt’s objectives
Source: IDATE DigiWorld for FTTH APAC

0,00%
100,00%
200,00%
300,00%
400,00%
500,00%
600,00%
700,00%
Philippines Thailand Australia New Zealand Indonesia India China Taiwan Malaysia Kazakhstan
% variation from Dec-2015 to Dec-16 in the number of FTTH/B Homes Passed by country
An aggressive deployment plan performed by PLDT
Also, significant deployment efforts has been executed during 2016 for example
in Philippines, Thailand, Australia and New Zealand…

Number of Homes Passed not representative of effective
coverage
Here, the ratio represented is % of FTTH/B Homes Passed
in total households
•5 countries > 90% !!!
•7 countries > 20%
•1 country over 10%
Japan:
100%
Singapore
: 100%
Taiwan:
96.5%
South Korea:
95.7%
Hong
Kong:
93%
China:
70.2%
Kazakhstan
: 62.2%
New
Zealand:
60.4%
Thailand:
38.7%
Australia:
34.3%
Malaysia:
33.7%
Indonesia:
20.9%
Philippine
s: 12.4%
India:
1.4%
Coverage: Top countries in terms of % of FTTH/B Homes Passed in total
Households

Total FTTH/B Subscribers by country
While China has increased its fibre subscribers and is still the leading country….
… countries like Japan and South Korea also have more than 30 or 10 million FTTH/B subscribers…
… and it can be observed 8 countries that already passed 1 million of FTTH/B subscribers
230
0
50
100
150
200
250
China
Millions
33
15
0
5
10
15
20
25
30
35
Japan South Korea
Millions
0
1
2
3
4
5
6
Millions

Key points for APAC
> Demography: a huge market potential
•India and China are the most populated countries in the world
•MDUs are dominating in large cities especially in China
•A huge potential of 550 M population: Bangladesh, Philippines, Vietnam and Pakistan
> Low competition from other xDSL or Cable networks
•The “quality gap” between copper and fibre networks is important: end users need fibre for higher bandwidth
•Cablecos are less dominating the broadband market than in Europe or in the US … and it’s not going to
change for now (SARFT in China)….a few exceptions like in India
> A key driver for mass market migration in APAC: NBN programs… the NZ success, now followed by the
Australian one
> Incumbents leading rollouts in APAC but also some free room for new entrants
•Some incumbents are deeply involved in national FTTH/B deployments (Philippines: PLDT accelerating now,
Indonesia, Malaysia)
•New entrants in large countries (India), mature markets (HK) or emerging markets (Vietnam)
> APAC Fibre dynamic is also being pushed by Mobile demands…
•Fibre for mobile Backhaul : LTE and metro / small cells … and 5G coming soon in APAC !!

www.idate.org
4. Toward Gigabit Era

Several technologies available to deliver Gigabit access
Source: IDATE DigiWorld, Ultrafast access technologies, November 2016
Current status and medium-term outlook for UFB technologies

How Gbps plans are evolving
29
Since 2013, Providing Gigabit
access has become a goal in
itself. The momentum has
been largely influenced by
Google’s initiatives, since
followed by private sector
operators and especially a
number of cities.
At the federal level, the
Government and the FCC
have announced new
measures in support of city-
led rollouts.
Europe
The Digital Agenda (DAE)
sets Europe’s connectivity
targets: 30 Mbps for all, and
100 Mbps connections or more
for at least 50% of European
households by 2020.
These appear very modest
targets when compared to
current technological
possibilities, and the
accelerated pace of the Gigabit
race, which more and more
ISPs seem willing to join.
Elsewhere around the world
In Asia, selling Gigabit-speed
access is a strategic choice for
private sector operators..
In Latin America and the Middle
East, just providing the entire
population with broadband
access is already a challenge,
so Gigabit access is not really
on the table as yet. But a few
ISPs do offer ultra-fast plans,
aimed at a very specific
clientele.
USA

2025 EU New Objectives: September 14th 2016
•1 Gbps for schools, universities, research centres, transport hubs, all providers of public services such as
hospitals and administrations, and enterprises relying on digital technologies,
•All European households, rural or urban, should have access to connectivity offering a download speed of at
least 100 Mbps, which can be upgraded to 1 Gbps,
•All urban areas as well as major roads and railways should have uninterrupted 5G coverage. As an interim
target, 5G should be commercially available in at least one major city in each EU Member State by 2020
30

Status of 1 Gbps plans around the world
Where are 1 Gbps plans available?
Source: IDATE DigiWorld, The Gigabit Race

Gigabit-specific applications
> Growing use of the cloud stimulating businesses’ interest in Gigabit access
•The growing availability of UFB is particularly appealing to businesses which download as much data as they upload, added to
which cloud solutions are being adopted more and more widely.
•The aim is to develop collaborative work spaces where users can view and work on shared content, without having to be in the
same location.
•The ability to access more powerful servers more quickly, and ideally located not too far from a city’s business district (which has
also been one of Google’s criteria for selecting the cities where Google Fiber will be deployed), helps bolster productivity
considerably.
> Personal communications and the Smart City
•Skype’s global success is undeniable and the application allows users to communicate cheaply between continents. Other online
players like Facebook (via Messenger and WhatsApp) have also entered the video calling fray.
•But quality of service is often lacking, and users are becoming more and more demanding.
•For public authorities, the driving forces behind their support for Gigabit access are clearly bound up with the services they
will be able to offer citizens.
•In the United States, US Ignite is an initiative launched by the Obama White House that aims to define 60 consumer applications
over the next five years that use Gigabit networks, as part of the Smart Gigabit Communities project.
> Entertainment still the name of the game in the residential market
• Video related requirements are increasingly steadily. Picture quality image also has a decisive impact on a household’s
bandwidth requirements. Some operators therefore put 4K and Gigabit side by side in their promotional material. In Canada,
Rogers Communications launched a Gigabit plan at 149.99 CAD a month, following announcements over the advent of 4K.
• 4K HDR is the next evolution ; one channel requiring up to 30 Mbps. A player like Fox making more and more content available
on 4K HDR
•The issue of 8K is also on the agenda, albeit further down the road. However, Japanese broadcaster NHK is working on
developing and broadcasting programmes in 8K, with a view to being ready commercially in time for the 2020 Olympic Games in
Tokyo. The bandwidth needed to stream content in 8K is estimated at 100 Mbps minimum.

Gigabit-specific applications
> Video games, virtual and augmented reality
•As with other business-related uses, consumers are
making increasing use of cloud solutions. This is
especially true when it comes to cloud gaming.
•Speculation over virtual reality has been rife for
several years now, which is is one of the most
demanding applications in terms of speed and
latency.
• High-end VR headsets only barely deliver the
performance needed for a fluid experience. More
than anything, however, a Gigabit connection is
vital for virtual reality apps which requires the very
fast transmission of a large volume of data to be able
to provide a realistic experience.
•Gigabit networks are also needed to ensure a good
quality image and efficient data transmission, for
instance when it comes to applications like
Google Earth VR. This application reconstitutes a
user’s location in the world based on data (textures,
3D elements) stored in Google Earth datacentres.
Source: Goldman Sachs Global Investment Research
Virtual and augmented reality hardware
shipment forecasts, 2015-2025
(000 units sold)

IDATE Research: Stream FTTx & Gigabit
34
MERCI !!!
 Roland MONTAGNE
Principle Analyst
Director DigiWorld Institute UK
mob: +33 680 850 480
r.montagne@idate.org

IDATE DigiWorld - FTTH global perspective 241017 Gigabit VF - Roland Montagne

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IDATE DigiWorld - FTTH global perspective 241017 Gigabit VF - Roland Montagne