Showing posts with label HFC. Show all posts
Showing posts with label HFC. Show all posts

Sunday, April 25, 2021

Week 16 in Telecoms, Internet, Media

CORPORATE

  • General
  • Ratings
  • Results
    • VodafoneZiggo: Impact Report 2020; 100% green energy, net CO2 emissions zero, 7501 employees, total 4572 towers, 118m IoT connections, uptime mobile 99.8%, uptime fixed 99.9%, NPS: Vodafone converged consumer +27, Ziggo converged consumer +7, hollandsnieuwe +22, Vodafone converged business +6, Ziggo converged business -4; Launches CSR targets 2025 (People Planet Progress): halve environmental impact, support 2m people in society
    • Eurofiber: 2020; 38300 network km, adds 40 km/week, 32932 customer connections, 215 datacenters, NPS +33, market share corporate fiber 26%, 100% renewable energy, total invested EUR 820m (50% of annual revenues)
    • Vodafone Ireland: Vodafone IE 2020/21, total 1020 employees
    • Orange Belgium: 21Q1; maintains guidance 2021: rev growth LSD, EBITDA AL EUR 320-340m, capex EUR 200-220m (incl MWingz 50/50 JV with Proximus)
    • Orange: 21Q1
    • Telia: 21Q1; outlook 2021 unchanged: SR flat-LSD, adj mEBITDA flat-LSD, capex SEK 14.5-15.5b; outlook 2021-2023 unchanged: SR LSD growth, adj EBITDA LSD-MSD growth, capex/sales 15% by 2023
    • Tele2: 21Q1; book value T-Mobile NL stake (25%) SEK 7.163b, profit contribution 21Q1 SEK -3m; proposes extraordinary dividend 3.00 SEK/share = SEK 2.1b
    • AT&T: 21Q1; outlook 2021: rev growth 1%, EPS stable, capital investment $22b o/w capex $17b, FCF $26b, div pay-out ratio high 50s
    • Verizon: 21Q1
    • EQT: 21Q1
    • Netflix: 21Q1; highlights:
      • net additions 21H1 slow due to pull forward and delayed slate dynamics plus typical seasonality (not new competitors); biggest competitors linear TV & YouTube, no material effect expected from economies reopening after corona virus pandemic
      • Targets 2021: to spend >$17b cash on content (2020: $11.8b), oper margin 20%, to maintain $10-15b in gross debt, to launch SBB $5b 21Q2, password sharing crackdown will not be aggressive; plans movies based on Sony IP based on distr deal [see 210408]
      • Viewing stats first 28 days: series Firefly Lane 49m, Cobla Kai season 3 45m,  Fate: The Winx Saga 57m, Ginny & Georgia season 1 52m, movies I Care A Lot 56m, YES DAY 62m, Outside the Wire 66m, To All the Boys I’ve Loved Before (final movie) 51m, foreign productions  Below Zero (Spain) 47m, Space Sweepers (S Korea) 26m, Squared Love (Poland) 31m, Who Killed Sara? (Mexico) 55m, Lupin (France) 76m
    • Snap: 20Q1; outlook 21Q2: rev $820-840m, adj EBITDA between -20m and zero

  • CSR
    • Telia
      • Launches new sustainability goals: empower societies in the Nordics & Baltics to achieve zero CO2 & waste by 2030, reach 1m people through digital inclusion initiatives by 2025, implement winning privacy & security strategies by 2023 to gain & maintain customers’ trust
      • Accenture report for Telia The Shift: The Role of Telcos in the Circular Economy: applying circular principles unlocks values of $45-80b annually

    • Orange PL sets climate goals: CO2 reduction, increase in renewable energy
    • Akamai: New sustainability goals: 5 goals in 3 areas (Akamai intelligent edge platform, communities in which it lives, works & operates, global supply chain): 100% Renewably-sourced Energy, 50% More Energy-Efficient Platform, 100% Platform Emissions Mitigationm Responsible Supply Chain Management, Global Expansion of 100% Electronic Waste Recycling Program
    • Amazon: The Climate Pledge reaches >100 signatories (5m employees in 16 countries), incl Elisa, Telefónica
  • WFH

NETWORKS

  • FTTH
    • Netherlands

SERVICES

  • Telecoms
    • Telenet launches ONE (to replace WIGO and YUGO): internet access (fixed & mobile & WiFi, no data cap), pricing speed-based pricing (at home 150 Mb/s or 1 Gb/s; away from 30 Mb/s), dependent on household; TV as add-on (managed via TV-box or OTT via Flow app); free extra data SIM (optionally for Minimodem: hotspot for max 10 devices)
  • Video
    • Pathe Thuis: Reaches 1m active users; usage 2021: total 7m films, average 2.2 viewers per film; distr deal with KPN from 210701: access to 3700 titles
    • Samsung: Expands Samsung TV Plus (on Samsung smart TVs) to NL, BE, LU, SE, FI, NO, DK, IE, PT; total 23 countries; also for Galaxy smartphones & tablets
    • Sony: Plans to trial PlayStation Plus Video Pass (15 movies, 6 series) in Poland, free for PlayStation Plus subs
    • Walt Disney: Content deal with Sony for Disney+, Hulu, ABC, Disney Channels, Freeform, FX, NatGeo in US for new theatrical releases & library titles 2022-2026 for Pay 1 TV window (after Netflix)
    • MTS plans OTT service Kion 210420 (to add AVOD tier end 2021)
  • Music, audio, podcasts
    • Apple
      • Launches Podcast Subscriptions in 170 countries per creator, price set by creator (from 49 c/mo in US; with Family Sharing)
      • Apple takes 30% in first year, 15% thereafter
      • Launches Apple Podcasters Program for creators, 20 $/mo
    • Spotify: WSJ: plans podcast subscription, creators keep 100% of fees (currently hosts 2.2m podcasts)
    • SoundCloud: Reaches 100k creators
    • Reddit: Launches Reddit Talk for subreddits, with moderators [a la Clubhouse]
    • Facebook: Plans new audio services in 3-6 mo
      • Soundbites (recorded audio messages)
      • Podcasts (discovery)
      • Live Audio Rooms (in Groups in Facebook & Messenger) [a la Clubhouse]
      • establishes Audio Creator Fund
      • partners with Spotify to integrate music (Project Boombox)
  • Hardware
    • Google: Fitbit launches Luxe, $150 (incl 6 mo Fitbit Premium): fitness tracker
    • Apple: Spring Loaded event
      • Launches new iPad (with M1 processor)
      • new Apple TV (with A12 Bionic processor, 4K, new Siri remote control)
      • AirTags (with U1 chip; keychain device for locating devices)
      • iOS 14.5
      • new iMac computer (with M1 chip) with new Magic Keyboard (with Touch ID)
      • launches Apple Card Family (to build joined credit)
      • launches podcast subscriptions

REGULATORY

  • Spectrum auctions
    • Slovenia raises EUR 164m from multiband auction (700, 1500, 2.1, 2.3, 3.5, 26) from Telekom Slovenia (EUR 52m), Telemach (EUR 52m), A1 (EUR 42m), T2 (EUR 18m)
    • Energistyrelsen (DK) raises DKK 2.08b from multiband auction (1.5, 2.1, 2.3, 3.5, 26 GHz); pops coverage demands 3.5 GHz band: 60% YE 2023, 75% YE 2025
      • TDC Net 45 MHz in 1,500 MHz band, 40 MHz in 2,100 MHz band, 40 MHz in 2,300 MHz band, 130 MHz in 3.5 GHz band, 1,250 MHz in 26 GHz band for DKK 795m
      • Hi3G 40 MHz in 2,100 MHz band, 120 MHz in 3.5 GHz band, 1,000 MHz in 26 GHz band for DKK 541m
      • TT-Network (Telia, Telenor) 45 MHz in 1,500 MHz band, 40 MHz in 2,100 MHz band, 140 MHz in 3.5 GHz band (incl 60 MHz with a leasing obligation), 600 MHz in 26 GHz band for DKK 741m
    • ACMA (Australia) raises AUD 648m from 26 GHz auction; Dense Air 2 lots for AUD 28.7m, Mobile JV 86 lots for AUD 108m, Optus Mobile 116 lots for AUD 226m, Pentanet 4 lots for AUD 7.90m, Telstra 150 lots for AUD 277m

  • Platforms
    • EC proposes harmonised rules on AI; list of high-risk use cases (critical infrastructure, college admissions, loan applications) subject to supervision and standards for development & use; fine on violations max 6% of annual global revenues; to be approved by European Council & European Parliament
    • US Senate antitrust hearing with Apple, Google over app store fees [monopoly rents]

at 1:23 pm 0 comments
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Monday, April 19, 2021

Week 15 in Telecoms, Internet, Media

CORPORATE

  • Orange BE
  • Tele Columbus: EC approves takeover; accepted by 91.96%, to close 210419, then rights offering to raise EUR 475m
  • Eir (NJJ 33%, Iliad 32%) Report on poor customer service during corona virus pandemic due to remote working and outsourcing
  • Virgin Media UK (Liberty Global): CMA (UK) approves O2 UK merger, "unlikely to lead to any substantial lessening of competition in relation to the supply of wholesale services" (provisional, open for comments until 210507, final decision 210527)
  • Altice Europe (Patrick Drahi): Moody's: assigns B2 to sr secured notes ($3b) issued by Altice FR, outlook negative (high leverage, weak FCF generation); increases debt maturity from 5.5 to 5.9 yr, interest savings EUR 50m
  • Telstra: Rumor: considers merging Telstra International with PCCW Global (talks with PE firm I Squared Capital), Telstra to acquire PCCW Global
  • Amazon: Annual Report 2020, Letter to Shareholders, Proxy Statement; reaches 200m Prime subs worldwide; spent $11b (+41%) on content (movies, series, music) in 2020
  • Netflix: Moody's upgrades from Ba3 to Ba1, outlook positive
  • Clubhouse: Raises funds; rumor: at $4b valuation; 10m WAU
  • Squarespace: Plans IPO via direct listing; symbol SQSP
  • AppLovin: IPO, symbol APP, IPO price $80, opens at $70, closes $65.20 (-19%) on first trading day
  • Epic Games: Raises $1b (incl $200m from Sony), valuation $28.7b
  • Reservoir Media: Plans IPO via SPAC, with with Roth CH Acquisition Co II; 21Q3 on NYSE, symbol RSVR, EV $788m

NETWORKS

General

  • Ookla Speedtest Global Index (March 2021)
    • Global average FBB 99/53 Mb/s, MBB 48/13 Mb/s
    • FBB: Singapore #1 (234), Thai #2 (231), HK #3 (225), RO #4 (211), Monaco #5 (205), NL #27 (137)
    • MBB: UAE #1 (179), S Korea #2 (171), Qatar #3 (167), China #4 (150), KSA #5 (134), NL #8 (103)
  • Tefficient mobile data usage report 2020 (ranking 105 MNOs)
    • Global mobile data volume +38%, Zain Kuwait #1 (40.2 GB/SIM/mo), DNA #2 (34.8), 3 Austria #3 (30.5); T-Mobile NL 6.0, VodafoneZiggo 3.4, KPN 3.1
    • "The bottom 11 operators are from the low usage markets of Greece (Vodafone), Czech Republic (TMobile), Belgium (Proximus, Orange, Telenet BASE), Germany (Telekom, O2, Vodafone) and the Netherlands (KPN and Vodafone Ziggo – but not T-Mobile)."
    • " the nine operators with the highest revenue per GB are from six European countries: Greece, Belgium, Norway, the Netherlands, Czech Republic and Switzerland."

FTTP

  • Orange PL establishes open access FiberCo (Światłowód Inwestycje) 50/50 JV with APG
    • Orange PL anchor tenant
    • Valuation PLN 2.748b (debt-free, cash-free) = EUR 605m
    • Orange PL to receive PLN 1.374b = EUR 303m (PLN 887m on closing, PLN 487 on delivery during 2022-2026)
    • Orange PL contributes 0.7m lines, to add 1.7m lines in 5 yr in mid/low competition areas, capex PLN 3b (partly from new debt (>80%), equity contributions PLN 300m from each during 2023-2026); ultimately to own 2.4m lines
    • Will not be consolidated by Orange PL; Orange PL has option to acquire extra 1% + control between 2027 and 2029
    • To close end Aug 2021

HFC

5G

  • AR: DNA plans 5G pilot at Hiukkavaara school in Oulu, with BusinessOulu, Educational & Cultural Services, City of Oulu, Oulun Digi, Hiukkavaara school, Playsign: to develop AR experiences for phenomenon-based learning
  • VR: BT plans 5G at Hyberbat (battery maker) factory to support VR-enabled digital twin, with Ericsson, NVIDIA, Qualcomm
  • 360 degrees video: Verizon launches TUDN Vision: portal for 360 degree watching of soccer games televised by Univision
  • Cloud gaming: Vodafone IT launches 5G cloud gaming platform GameNow
  • SA 5G: Vodafone DE launches SA 5G in 3.5 GHz band at 10 sites in 170 cities, with Ericsson, Qualcomm, OPPO; latency 10-15 ms
  • Bell Labs Consulting (Nokia) report The Big Inversion ("How 5G+ technologies will create new value for industries in a post-COVID world")
  • Private Wireless
    • Nokia and EY partner on Private Wireless, 3 key offerings: 1. fuelling digital change in manufacturing, energy, and operations across industries, including for governments and cities; 2. building cybersecurity and digital trust by protecting and managing challenges brought by IoT and IT/OT crossover; 3. helping telcos, specifically, to capture and monetize 5G business enterprise opportunities
    • DT acts as SI for Private 5G for Industry 4.0

6G

SERVICES & CPE

Telco & other

Music

  • Spotify
    • Launches Car Thing in US (smart player, limited release, invite-only), free for select Premium subs (excl shipping): voice control (“Hey Spotify”), dial, touch screen (4 inch), preset buttons, requires Bluetooth and smartphone; "Our focus remains on becoming the world’s number one audio platform—not on creating hardware—but we developed Car Thing because we saw a need from our users, many of whom were missing out on a seamless and personalized in-car listening experience."
    • Partners with Warner Music Group to develop podcasts around WMG's catalogs
  • Apple Music: WSJ: Apple Music pays 52% of subscription rev (0.01 $/stream) to rights holders [compare Spotify: 67% to rights holders o/w 75-80% to labels = 50-53; Spotify has more subscribers and has a free+ads tier]
  • Distr deal with Epix (= MGM): bundle 13 $/mo, exclusive access to music to series Godfather of Harlem 
Video

  • Self Financial report based on IMDb ratings: Apple TV+ #1 (average score 7.24 or 7.13 on 70 titles), HBO Max 7.13 or 7.01, Netflix 6.94 (530 titles), Disney+ 6.63 (420 titles)
  • Morgan Stanley survey US: 39% say Netflix offers best originals, Amazon Prime 12%, Disney+ 7%, Hulu 7%, HBO Max 6%
  • Antenna & MoffettNathanson report on churn rates US 20Q4: Netflix 2.5%, Disney+ 4.3%, Apple TV+ 15.6%, HBO Max 6.7%, Peacock 9.5%
  • Plex: Reaches 25m MAU (r'red users who spent >= 10 minutes on Plex); >150 free channels, 20k free movies & episodes (from Lionsgate, Warner Bros, MGM, Sony Pictures Television, Sinclair Broadcast, AMC, A+E, Crackle, BBC); raises $50m

REGULATORY

  • Amazon: WSJ: leverages dominance in one business to compel partners to accept terms from another
  • Twitter: Launches Responsible Machine Learning Initiative led by ML Ethics, Transparency and Accountability (META) team: assess downstream or current unintentional harms in the algorithms used
  • Platforms
    • US Senator Josh Hawley (R-Mo) proposes Trust-Busting for the Twenty-First Century Act: ban M&A for fimrs with market cap >$100b, replace antitrust issue of consumer harm by protection of competition, , empower FTC
    • EU plan for AI regulation leaked: to establish European Artificial Intelligence Board
    • US House of Representatives Judiciary Committee approves report on platforms (Google, Facebook, Amazon, Apple); "each hold monopoly power over significant sectors" [see 201006]


at 1:14 pm 0 comments
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Monday, May 14, 2018

Vodafone to acquire Liberty Global assets


Vodafone acquires Liberty Global assets for EUR 18.4b o/w 10.8 cash, 7.6 existing Unitymedia debt.
  • Operations
    • DE (Unitymedia; together 25m HP = 2/3)
    • HU (1.8m HP = 43%)
    • RO (3.1m HP = 41%)
    • CZ (1.5m HP = 33%)
  • Valuation
    • EV EUR 18.4b
    • 10.9x EBITDA 2019 (pre synergies)
    • 8.6x EBITDA (post synergies 5 yr)
    • 12.5x OpFCF (post synergies 5 yr)
  • Closing
    • To close mid 2019
    • Break-up fee EUR 250m payable to Vodafone, or payable to Liberty if for antitrust issue.
  • Synergies
    • Cost/capex synergies (network integration, IT/billing simplification, procurement, consolidating overlapping functions) 535m EUR/yr from yr 5 (before integration costs)
    • NPV EUR 6b (after integration costs) o/w rev synergies NPV EUR 1.5b (from cross-selling)
    • Integration cost EUR 1.2b (in first 5 yr).
  • Accreditive to FCF from yr 1.
  • Increases targeted net debt/EBITDA to 2.5-3.0x (pro forma at high end).
  • Liberty Global to provide transitional services to Vodafone (IT, TV platform tech, connectivity, other support) max. 4 yr; pro forma EUR 128m in 2019.

at 4:44 pm 0 comments
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Tuesday, November 19, 2013

FTTH vs. HFC is about opex, capex and timing

The FTTH/HFC controversy continues. Our views are always in flux and here is an update.

  1. The government should stay out. And if they wish to interfere, there's only one way to justify this: nationalize the infrastructure, and separate the network from services.
  2. We assume that an all-fiber network requires 'high' capex, but saves 'considerably' on opex. Evidence is growing:
    • KPN states that FTTH opex is at least 30% less than copper opex.
    • FTTH capex is continuously falling, as best practices grow.
    • At Ziggo, opex and capex are continuously rising. Capex is doubling over the last 3 years.
    • UPC states that EBITDA (OCF in Liberty Global speak) margins will structurally head lower.
    • Small cable companies in the Netherlands, that have no shareholders demanding decent quarterly returns, all do FTTH. Some even skip Docsis 3 and go straight from Docsis 2 to FTTH.
    • Netflix is taking a toll. It simply must.
    • Better compression and other efficiency gains are nice, but even at a 50% improvement, they only buy 1 year of delay, since data traffic grows at roughly a 50% rate.
    • Stratix put out a report that calculates what the roadmap, as laid out by TNO, would cost in terms of capex. Stratix claims the TNO gigabit (!) roadmap would be more expensive than overbuilding with fiber.
  3. "Cable (HFC) will serve the market well beyond 2020". This statement from TNO must be read in 2 different ways:
    • To say this, is to state the obvious. Any network can last. But one network will require more work (HFC) than others (FTTH) in terms of opex.
    • Most importantly, it is a responce to an earlier TNO report, covering the 2010-2020 period. It suggested to some that cable companies would cease to exist on December 31, 2020. Which is of course total nonsense.
  4. What the opex/capex implications of infrastructure choices are, ...
    • ... is relevant to the cable operator. "Do we upgrade our old car, or do we buy a new one?", so to speak. It's a matter of timing.
    • ... is a priori irrelevant to the end user. It may translate into a slower network and/or higher tariffs, and then the end user hopefully has an alternative to go to.
    • ... is also irrelevant to the government (see 1.).
    • ... is not irrelevant to shareholders, which is why public cable operators claim that they have future-proof networks.
UPDATE December 3, 2013
  • Supply side: is about fiber (or 5G), future-proofing, skipping interim technologies (VDSL, Docsis 3, ...) versus legacy
  • Demand side: expected traffic growth and business model (scarcity or abundance)
  • Customer's role is limited to becoming a subscriber or quit.
  • Shareholder's role is limited to buy or sell shares.
  • Government role is to regulate, facilitate and when the market fails: intervene.
  • Management's role is to make a choice between scarcity/minimising capex and abundance/maximise capex; or strike a balance between customer interest (maximise capex) and shareholder interest (minimise capex).

at 11:30 pm 0 comments
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Sunday, October 10, 2010

HFC: lines are 97% fiber, but route km just 6%

Claims from the cable industry concerning the amount of fiber in their networks (97%) are realistic and unrealistic at the same time. It all depends on your perspective. If you are an end-user, the claim is defensible. If you own the network and think in terms of route kilometers, you will agree that it's not, because just 20% is fiber (source: FTTH Platform NL). In reality, this number is even worse and closer to just 6% (an informed source tells me).

End-user perspective
Cable operators in the Netherlands claim that 97% of their network is fiber. This would be the portion of the network (line) between your home and the Internet. The last mile is on average 300 meters (in the Netherlands). If the signal travels over non-fiber, this may function as a bottleneck, but over short distances like these (or 90 meters in early FTTH deployments, which were in fact FTTC) its doesn't really matter that much. In fact, in-home networking at 10 meters can be just as much as of a bottleneck.

Once this bottleneck needs to be taken out, fiber needs to be extended to let's say the home's WiFi router. And an interesting argument for this is gaining importance: the number of connected devices (directly or via WiFi) is exploding:
  • Computer (desktop, laptop)
  • Connected TV, hybrid STB
  • Blu-ray player
  • Game console
  • Smartphone, iPhone
  • LiveView (Sony Ericsson's new 'data pager')
  • E-reader, Kindle, Nook
  • iPad, notebook, tablet, netbook, smartbook, speedbook, booklet, ....
  • Femtocell
  • umi (Cisco's video calling box)
Network-owner perspective
Once the cable operator decides to extend fiber to each subscriber, he will realise that he will need to dig a lot more than just 3%. UPC NL (2,777,300 homes passed) and Ziggo (4,107,000 homes passed) would probably need to spend FTTH-like amounts of cash, say 800 EUR/home. That translates into EUR 2.2 billion for UPC and EUR 3.3 billion for Ziggo. Large sums for their controlling (Liberty Global owns UPC) and prospective (Ziggo's IPO may come in 2011) shareholders to reckon with.

at 11:25 pm 0 comments
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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.

at 4:40 pm 0 comments
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Wednesday, July 22, 2009

FTTH versus HFC: short- and long-term over- and underestimation

Paul Budde has written a very eloquent piece on the FTTH/HFC debate. I have been talking to a number of cable execs myself recently, and my attempt at The Truth is something like this:
  • The Medium. In general, the shortcomings of HFC networks include limited downstream (where Docsis and other technologies help out), even more limited upstream (where channel bonding options are more limited), the medium itself (which is much less 'transparant' for signals than fiber, which is why HFC operators need several amplifiers in their access networks) and the fact that it is a shared access network (just like wireless).
  • The Upgrades. HCF operators have a choice of many technologies and techniques (I counted 14!) to upgrade their networks. The trouble is, some do not apply for practical reasons, some are still embryonic and others may prove costly.
  • End-game. Even if HFC operators manage to do node splits to 1 per 20 homes and fiber deep to reduce the access network to 50 meters, expand the spectrum to 3,000 GHz and apply 256-QAM, questions remain: how much does it cost, and is it enough?
  • Access network. In the above case, a 50 meter access network could in practice not be too different from an in-home network based on copper or coax in most FTTH networks.
  • Non-linear video. The big threat is a migration away from linear TV to non-linear HD video, in both the uplink and the downlink. Here it is important to note that people tend to overestimate the short-term and underestimate the long-term. In other words: yes, upgrading will allow HFC operators to compete for several years; and no, it may not be enough and a full FTTH migration may be necessary.

at 12:21 pm 0 comments
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