Balance shifts towards FTTP
Fibre all the way to the premises (FTTP) will play a much bigger and earlier role in next-generation broadband in the UK than was assumed even a few months ago. That means that Britain could be getting the full benefits of superfast broadband years earlier than expected.
In fact, FTTP is already ahead of its slower but less expensive little brother, Fibre To The Cabinet (FTTC), at least for the moment. Point Topic estimates that at June 2009 there were around 600 fibre connections in place in the UK and at least 580 of them were FTTP.
Now BT has announced that it will cut back its FTTC plans and increase its planned FTTP rollout by 150%. This marks a shift of at least £200m of investment away from FTTC.
“When a major player under tight financial constraints decides to shift that much investment towards FTTP you have to take it seriously,” says Tim Johnson, Chief Analyst at Point Topic. “ It’s got to be a pointer towards the way things are going.”
BT’s FTTP announcement on 9 October broke new ground by proposing FTTP coverage for areas where copper-based services are already available, rather than catering just for new developments. It has already announced FTTP trials for to “brownfield” sites in Milton Keynes and North London.
Further details are lacking, for the moment, on which other areas will be favoured with the superior service, or quite why Openreach has decided it is economic to make such a big shift in its investment plans.
“Partly, it’s a shift in their cost-benefit analysis,” says Johnson. “It’s turning out to be cheaper than BT feared to install FTTP, and the case for users wanting superfast bandwidth is getting stronger all the time.”
“But the desire to head off cherry-picking competition by alternative service providers such as H2O may have had a strong influence too,” he adds.
FTTP (also known as Fibre-To-The-Home, FTTH) is usually more expensive to install than Fibre-To-The-Cabinet but it is generally recognised as more future proof, offering much higher speeds, more capability for multiple applications and lower maintenance costs. If operators can finance the initial investment they should be able to make a better return in the long run.
Alternative providers lead the roll-out
Real deployment of next-generation access (NGA) networks finally got off the ground during the first half of 2009.
Actual services are in use in at least five locations across the UK – London, Bournemouth, Glasgow and villages in Rutland and Northern Ireland. But none of these pioneering ventures were due to any of the big names in the communications business. Each one was provided by a different alternative communications provider, most of them founded specifically to take advantage of the NGA opportunity.
Velocity1 leads the way at the moment. Set-up by Industria and Quintain the company launched its FTTP services in the Wembley City estate in North London early in 2009. At June 30th they had 286 homes and 15 offices connected to their FTTP service and take-up in the site’s first apartment building is over 60%. Along with other early movers like H20, Velocity1 is building an empirical case that users want high bandwidth and will pay for it.
Some other greenfield projects are not doing so well. Belfast’s £5.5 billion Titanic Quarter regeneration project, for instance, is not expected to have homes connected until the end of 2009 simply because premises are not being built as fast as originally planned. BT’s Ebbsfleet initiative continues to be a slow burner with initial build limited to around 600 new homes and the whole project unlikely to be completed before 2020.
Community projects
Bottom-up initiatives from grassroots-based community groups are attracting a lot of attention and achieving some success.
Initiatives like the Independent Networks Cooperative Association and increasing co-ordination through the Community Broadband Network (CBN) and the project for Commercial, Operational and Technical Standards (COTS), community-led broadband developments should have more chance of achieving results over the coming months.
“Projects like these are likely to be the best chance for those in the hard to reach areas. With commercial deployment unlikely in the next three to five years, without significant subsidy, next generation access infill will be driven by local initiatives,” says Johnson
FTTC not dead yet
Meanwhile, Fibre-to-the-Cabinet is far from dead and should surge well ahead of FTTP in numbers in 2010. BT Openreach started to wire up its first trial FTTC users only in August, and had about 300 online by the end of September. With a commitment to pass one million homes by the Spring of 2010 the numbers will soon be substantial.
The biggest alternative FTTC project, Digital Region in South Yorkshire, should be switching on customers in significant numbers next year as well. And even Virgin Media is trialling FTTC as a way of serving the areas which its cable network does not reach, with a trial in Saltash, near Plymouth.
“Yes, FTTC will stay ahead of FTTP in terms of numbers for a few years,” Johnson explains. “But our research and the BT announcement show that fibre-all-the-way is rapidly becoming the more attractive option. FTTP will catch up and overtake FTTC. I believe it will be the majority technology for next-generation access in the UK by 2015.”
***END***
For background data and charts please contact:
Point Topic: Oliver Johnson
Email: oliver {at} point-topic(.)com
Tel. +44 (0) 20 3301 3303
About Point Topic
http://www.point-topic.com
Point Topic is an analyst company focusing entirely on broadband. Point Topic’s international services have a global reputation for providing the most up-to-date and authoritative user statistics, supplier profiles and applications reports on DSL, FTTx, cable and other broadband services worldwide.
Point Topic, reg. in England 3503830. 61 Gray’s Inn Road, London WC1X 8TL.
|
TechWhack on Facebook
|
