Friday, February 26, 2010

Google Fiber update #4: coming to Holland?

The latest developments around the four pillars of Google's OA FTTH trial plans.

  1. Technology. Costas has a funny map, turning PON upside down. Meanwhile, Cisco is preparing an event March 9 for a "significant announcement that will forever change the Internet and its impact on consumers, businesses and governments". According to the Financial Times, they are working with US carriers. Would that be exclusive arrangements, or could Google buy the same technology from Cisco?
  2. Bandwidth. Apart from another move toward 1 Gb/s (FibreCity in Bournemouth, but only as a 'power boost'), there are also several intermediate steps to 200 Mb/s (XMS in the Netherlands; Virgin Media expanding its trial in the UK; Novus in Vancouver).
  3. Cities. US candidate communities seem to be concentrating in a select number of states. Newcomers again are mainly in North Carolina (Greensboro), Michigan (Ann Arbor, Holland) and California (the expected Palo Alto, Saratoga, Sunnyvale, La Jolla, Redding). Others include Washington DC, Baltimore, New Orleans, Topeka (Kansas), Mason City (Iowa), Peoria (Illionois), Charlottesville (Virginia).
  4. Open access. Last week it was ETI, this week ECI Telecom making the case for open access. Further, HeLi Net teams with PacketFront to market open access FTTH in Germany.

Friday, February 19, 2010

Google Fiber: Update #3

New developements regarding the four basic specs of Google's OA FTTH trial plan:

  1. Technology. Gordon Cook presented his latest Cook Report (Building A national Knowledge Infrastructure - How Dutch Pragmatism nurtures a 21st Century Economy), which draws on SURFnet's mission in the Dutch science sector and beyond, as innovation is its mission. I recently spoke with the newly appointed CTO about SURFnet's hybrid optical network. Would Google be interested in these new developments?
  2. Bandwidth. Shaw Communications, an MSO in Canada, is planning FTTH for new appartment buildings, providing up to 1 Gb/s, which is rapidly becoming the new standard.
  3. Cities. Facebook holds dozens of grassroots plans. Communities that have expressed interest so far include: Seattle, San Francisco, UTOPIA (16 towns, 500k pops), Somerville (Mass), Austin (Tex), Columbia (Missouri), Winston-Salem (NC), Fayette County (Georgia), Hawaii, Duluth (Minnesota), Madison (Wisconsin), Pittsburgh, Portland (Ore), Bellingham (Wash), Muskegon (Mich), Raleigh (NC), Durham (NC), Auburn (Alabama), New York State, Chapel Hill (NC), Carrboro (NC). More initiatives at: Grand Rapids (Mich), Kirksville (Missouri), etc.
  4. Open access. See ETI's report in the previous post.

Wholesale regulation stimulates investment

Here's a report, "Regulation, Investment and Jobs", from Economics and Technology Inc. (ETI), sponsored by PAETEC, Cbeyond (see this cute little post), Covad Communications, Integra Telecom, tw telecom and Public Knowledge, submitted to the FCC. There is a similar report from ETI for MTS Allstream. They kind of support the findings of the Berkman report: "elimination of many vital wholesale regulations of the Bell Operating Companies resulted in less investment and significant job reductions in the telecommunications sector over the past several years." Re-introducing wholesale would contribute "a conservative estimate of a $66 billion improvement in the Gross Domestic Product and the creation of 234,000 jobs in the US economy."

"Similar to the recent announcement by Google that high speed fiber networks that it proposes to trial in a few communities on an open access basis to promote a choice of service providers for end users, regulatory policies should promote open access for broadband networks."

Monday, February 15, 2010

Second thoughts on Google's open access FTTH plans

The dust hasn't even begun to settle, but here are some 'second thoughts' on Google's FTTH project.
  • Topology/technology. Looks like point-to-point, but who knows what Google will come up with, and who the suppliers will be.
  • Bandwidth. 1 Gb/s is quickly becoming a new benchmark.
  • Cities. I suppose towns that unsuccessfully ran munifiber attempts in the past are most likely to be included. Possibly Palo Alto - and Seattle has already enlisted.
  • Open access. Apparently, Google has no plans to become an ISP or include voice or video; it wants to build just an IP data pipe. This raises lots of obvious questions. It looks like a huge bet on over-the-top (OTT) for all services. FTTH would be the last step, combining all previous efforts into voice (Google Voice), video (YouTube) and other applications. And it looks like YouTube is only just beginning to provide video-based content. Also: imagine a traditional triple play provider seeking access to the network ....

Thursday, February 11, 2010

Mexican court rejects wireless auction delay appeal

Let me see if I get this. So their was an auction planned. Then somebody delayed it. Next, somebody else appealed - the delay, I suppose. And now the court rejects the appeal.

So where does that leave the delay? Or the auction?
Prince Charming: You! You can't lie! So tell me puppet... where... is... Shrek?
Pinocchio: Uh. Hmm, well, uh, I don't know where he's not
Prince Charming: You're telling me you don't know where Shrek is?
Pinocchio: It wouldn't be inaccurate to assume that I couldn't exactly not say that it is or isn't almost partially incorrect.
Prince Charming: So you do know where he is!
Pinocchio: On the contrary. I'm possibly more or less not definitely rejecting the idea that in no way with any amount of uncertainty that I undeniably
Prince Charming: Stop it!
Pinocchio: or do not know where he shouldn't probably be, if that indeed wasn't where he isn't. Even if he wasn't at where I knew he was
Pinocchio: That'd mean I'd really have to know where he wasn't.

Wednesday, February 10, 2010

Google plans open access FTTH trials

This is probably the single most exciting announcement for some time: Google plans one or more FTTH trials in the US, working with municipalities. They will be open access networks offering 1 Gbps (so that looks like a next-gen point-to-point network) at 'competitive prices', reaching 50-500k people. Google asks states, counties and cities to respond to an RfI (until March 26).

Google's goals: see what can developers and users do with it; learn new ways to build FTTH.

Some thoughts:
  • Google already has extensive infrastructure, mostly backbones and datacenters. Adding the last mile would be the final piece before Google can actually turn into the Internet.
  • There will be a lot of people worrying over Google becoming too powerful and too much in control. Hence open access, but will that be enough? Who will object? Apple perhaps. Verizon and Comcast will be worried, but not be able to cry foul.
  • Google itself is clearly frustrated with the level of competition and pricing, the speeds available, the reach of current high-speed networks, the ARRA Act and the lack of open access.
  • Once markets are chosen, community efforts may be launched because penetration makes the business case fly. To offer 100x more bandwidth effectively rules out markets where Docsis 3, FTTC/VDSL or FTTP are offered. Hence, it may stimulate Comcast, AT&T and Verizon to quickly roll out their own version of an NGA network. This will lead to a price war.
  • Google has hoards of cash. At the recent Q4 earnings it was announced that cash and equivalents stand at $24.5 billion. At 1,000 $/home, connecting 500,000 homes would cost $500m - and the network will be cash flow positive way before they burn through it all, turning the network self-financing and able to connect the entire country.
  • Saying it will be 1 Gb/s, implies point-to-point since current GPON implies 2.5 Gb/s down (and 1 Gb/s up) shared among 32, 64 or 128 subs. No explicit mentioning symmetrical connections though, but I am sure Google is going for the ultimate thing.
  • The Bill & Melinda Gates Foundation recently proposed connecting all institutions in the US to fiber. Could the arch-enemies work together to fight the cable (Docsis)/telco (FTTN or non-open FTTP) duopoly?
  • The RfI to states, counties and cities has unclear implications. Is Google asking them only to be a candidate, or could Google want deeper involvement, such as co-investment? Most likely cities that had munifiber plans in the past, which were shot down by the cable/telco lobby, will have a new chance to connect to fiber. They will be lining up. How about Palo Alto, California?
  • Google plans to experiment with the latest techniques. They can build on international experience and do things first-time-right. However, the US is a unionised country, isn't it? And you need construction firms to do the dirty work.
  • Open access, hence access to any service provider. This could mean that Google will build both the passive and active layers. In theory, Google could also be a service provider itself (after all, they say "We plan to offer service at a competitive price"), but that would mean competing with its own wholesale customers. I suppose they will need to be an ISP themselves - unless their wholesale prices are low enough to attract competing ISPs.
  • Offering open access flies in the face of the FTTH Council NA, that is supposed to protect the interests of its members. Yeah right. It was about time that somebody with a long-term view and focus on customer happiness entered the market. Now we only need Google to make a trip around the world.
  • What will the regulator do?
  • Google wants to move quite fast. The RfI runs until March 26.
  • The Google stock ended the session down just 1.5% (this by the way equates to $2.5bn). That is encouraging. Investors are not scared off by Google plans. Incumbents worldwide should take a lesson and be less afraid to 'dig in'.

Tuesday, February 09, 2010

Ams-IX takes the 900 Gbps hurdle

Friday, February 05, 2010

Deloitte joins the cable lobby

There are a few controversies that can get people really worked up. PON vs. active ethernet is one, cable modem broadband vs. FTTH is another. A lot of it is 'religious', as in 'believing', or alternatively as in 'preaching for the converted'. That's why you have to be aware of lobbyists at all times. See for instance my post on the FTTH Council North America, which turned out to be a silly lobby movement.

Now this is all fine and dandy - until they start abusing my own research. Last year, I produced a report on the possibilities of HFC networks - working closely together with a number of people at Ziggo and UPC. Bottom line: no fewer than 14 technologies can be applied, the ultimate one being FTTH. However, the cost, both in terms of capex and opex, could be prohibitive and it could therefore make more sense to skip most of them, and move straight to FTTH. I have to say that the people at UPC were very realistic, leaving a move to FTTH open for the future. The Ziggo people turned out to be the cable broadband hawks, claiming that they would prefer HFC to eternity - even in greenfields.

Indeed, a whole range of smaller cable companies in the Netherlands have concluded in the meantime that they will need to move to FTTH - #7 (CAI Harderwijk) being the last in the line. But not the market leaders, #1 Ziggo (controlled by Warburg Pincus and Cinven) and #2 UPC (Liberty Global). Their lobby club NLkabel turned to Deloitte and got them to produce an inferior report, building in part on my own research into cable broadband (as referred to above). They have taken a large section (going beyond 'fair use', I would argue), describing these 14 technologies and techniques, and added questionable statements on capex, CPE upgrades, the 'asymmetrical nature of traffic' and the possibilities of HFC and FTTH.

For instance, they claim a capex/revenue ratio of 22% for cable and 6% for KPN, while everybody knows that in reality these numbers are almost equal at around 13%. Cable's number is inflated by CPE, and if one would subtract the capex involved in replacing amplifiers (Ziggo alone has over 200,000), then you wonder how much cable companies are really investing at all at the moment. Sure, a lot was done upgrading to HFC, but the roll-out of Docsis 3 is relatively cheap.

The report also claims that networks can easily keep up with demand. That's like saying that nobody driving a Fiat does 200 km/hour. They go on to claim that traffic is by nature asymmetrical, but they must have missed the realities of the Nuenen FTTH network, where traffic turns out to be pretty symmetrical (as Herman showed). And when extrapolating the capabilities of HFC versus FTTH to 2012 (!), of course Deloitte's expectations for FTTH are lower than those for HFC - while 1 Gbps is clearly on the horizon for FTTH.

Paul Budde said it very well: "we are not building FTTH for today's problems". Indeed, we are not building FTTH for triple plays alone - not to mention the advent of 3-D and non-linear TV/video.

OTT: Cable (broadband) friend or foe

Great line-up: Intel and Yahoo!, plus a number of box makers: TiVo, Roku ('several hundred thousand'), Boxee ('330,000 users'), Sezmi and others.

TVOT09: Over The Top to the Living Room: With or Without Cable? - Large Panel Discusses from Tracy Swedlow on Vimeo.

Monday, February 01, 2010

Open access coming to another HFC operator

CAI Harderwijk, one of the nation's 26 or so cable companies, has decided to open up to third-party ISPs. In the Dutch cable sector, this is not quite the first time; Kabel Noord has UPC and Ziggo as service providers. And Ziggo provides services over several non-owned private networks. CAI Harderwijk itself offers voice and internet services form CAIW, another small MSO. But now, an FTTH-focused ISP will launch services on CAI Harderwijk's HFC network: Solcon - which had a few conditions of its own: high-speed symmetrical bandwidths and full fiberisation of the network.

Obviously, we need some answers on how CAI Harderwijk is tackling these issues. On their website, they claim to offer symmetrical services, which should be possible through channel bonding, of up to 100 Mb/s. It's a Dutch first.

Here is another rift in the cable ranks, normally quite outspoken against both FTTH and open access (OA). It will be interesting to see how the cable lobby group NLkabel will respond. After all, CAI Harderwijk and Kabel Noord are both members.

IMHO: the question is not if, but when Liberty Global will adopt FTTH and Ziggo will adopt OA.