GPON interoperability essential according to study

An Informa Telecoms & Media study conducted on behalf of the Broadband Forum indicates that a majority of carriers view interoperability and certification of GPON gear will prove essential for the fiber to the home (FTTH) technology’s future prospects.

Perhaps not coincidentally, the Broadband Forum offers both an interoperability test plan and a GPON interoperability certification program.

Informa released the study results last week in a report entitled “Optimizing the Fiber Business Case.” The market research and consultancy firm surveyed 237 broadband industry “stakeholders” and interviewed senior executives at Orange, BT, Chunghwa Telecom, PCCW, Alcatel-Lucent, Calix, Huawei, and PT Inovacao. The report includes case studies culled from these interviews.

Both Informa and the Broadband Forum expect GPON will become the dominant FTTx access technology in 2016, passing 200 million connections in 2018 to account for three out of five FTTx connections worldwide. However, interoperability issues between different vendors’ OLT and ONU equipment has caused an array of problems for many service providers and need to be addressed if GPON is to fulfil its promise, the report suggests.

Key findings of the report include:

More than half of GPON operator respondents (53%) said that interoperability issues increased their internal testing burden, while 44% reported issues with network performance issues and 41% with greater management overhead.

Interoperability is the second most important ONU selection criteria behind price (31% versus 41%), with maintenance costs (10%), software features (8%), hardware features (7%), and number of ports (5%) considerably less influential.

Certification is emerging as a catalyst to drive the transition to multivendor GPON networks, with “many” service providers and vendors confident of deriving benefits, according to Informa and the Broadband Forum. For example, survey respondents said that, on average, certification could help, or has helped, shorten the time spent selecting and testing GPON ONUs by around 40%.

Next year will see increased activity around GPON interoperability as several major operators move towards deploying multivendor networks, a host of smaller operator RFPs hit the market, and challenger vendors look to shake up the market.

“These findings affirm the importance of the Broadband Forum BBF.247 certification program and TR-255 ONU/OLT interoperability test plan,” said the Broadband Forum’s CEO Robin Mersh. “Establishing interoperability of GPON equipment is a key building block to simplifying the deployment of fiber networks, but as noted in the case studies, there is much to be done around NG-PON2, and the biggest challenges may well be ahead of us. This work has begun and got a good jump-start at a recently held workshop between the BBF, FSAN (Full Service Access Network), and the ITU-T.”

Verizon reports double-digit earnings growth in 2013 third quarter

Looking at the wireline segment, consumer revenues were $3.7 billion, up 4.3% versus the year-ago quarter. This marks the fifth consecutive quarter of 4% year-on-year growth, Verizon says. Consumer ARPU for wireline services rose to $112.86, up 8.7% year-on-year. Wireline operating income margin was 1.6%, up 120 basis points over third-quarter 2012.

FiOS revenues increased 13.4% to $2.8 billion, versus $2.5 billion in 3Q12. Verizon said it added 173,000 net new FiOS Internet connections, up 27.2% from third-quarter 2012, and 135,000 net new FiOS Video connections, up 13.4 percent. Verizon had a total of 5.9 million FiOS Internet and 5.2 million FiOS Video connections at the end of the quarter, representing year-over-year increases of 12.6% for each.

Meanwhile, FiOS Internet penetration reached 39.2% at the end of the recent quarter, versus 37.0% at the end of third quarter 2012. FiOS Video penetration was 34.9%, compared with 32.9% in the year ago quarter. The FiOS network passed 18.3 million premises by the end of third quarter 2013, Verizon said.

More than 40% of FiOS Internet customers subscribed to FiOS Quantum, which provides speeds ranging from 50 to 500 Mbps, up from 35% at the end of 2Q12.

Total broadband connections reached nearly 9.0 million at the end of the quarter, up 2.6% year-over-year. Overall, net broadband customers increased 56,000 in the third quarter, as FiOS Internet net customer additions more than offset a decline in DSL subscribers. Along these lines, Verizon reported that through the first nine months of 2013 it had migrated nearly 250,000 homes to from copper to fiber to the home (FTTH) and is on track to exceed its target of 300,000 migrations within FiOS markets in 2013. By year-end 2013, Verizon projects it will have less than 1 million remaining customers served by copper in FiOS markets.

"These strong third-quarter results reflect Verizon’s long-term investment in reliable, high-quality networks to deliver value to customers," said Lowell McAdam, Verizon chairman and CEO. "Our unwavering focus on wireless, FiOS and strategic enterprise services has produced consistent performance, and we've delivered double-digit earnings growth in six of the past seven quarters. Verizon's strategic networks form a powerful distribution platform for future growth and innovation."

North American FTTH connections pass 10 million

The number of homes in North America connected to a fiber-to-the-home (FTTH) network has exceeded 10 million for the first time, reported Michael Render, owner and chief analyst at RVA LLC, at last week’s FTTH Conference. RVA is a market research firm that frequently provides research services to the FTTH Council Americas.

The number of FTTH connections on the continent has grown steadily since 2004, RVA reports, and reached 9 million in September 2012 (see “FTTH Council Americas releases FTTH market numbers”). The U.S. accounts for 90% of the current North American connections, Render said. The latest figures, which illustrate the state of play as of September 2013, also show the number of homes passed has reached 27.7 million (versus 24.3 million in September 2012), while homes marketed have reached 25.5 million.

In the U.S., Tier 1 ILECs, led by Verizon, account for 76.7 of the country’s 9.6 million FTTH connections. Other ILECs have connected 10.4% of the country’s total FTTH subscribers, with municipalities and public utilities combining for another 4.2%. This last group has nearly half of the country’s gigabit networks, 11 of the 26 RVA have identified. Competitive access providers, including Google, account for another nine such networks.

Render also reported that take rates for FTTH networks in the U.S. continue to grow. The average take rate for FTTH networks in the country reached 45.8% last month, he said

AT&T starts rolling out its Austin FTTH network

AT&T (NYSE: T) has started to deploy its fiber to the home (FTTH) network in Austin over which it will offer its 1 Gbps “GigaPower” data service and U-verse TV beginning in December.

Initially, the service provider will offer symmetrical speeds of up to 300 Mbps. Eligible customers that subscribe to the 300 Mbps tier in December will be able to upgrade to the 1 Gbps speeds when they become available in mid-2014.

Current AT&T mobile customers that sign up for a GigaPower plan will also get 50 GB of free cloud storage.

The service provider said that U-verse with GigaPower service will be rolled out to tens of thousands of customer locations throughout Austin and surrounding areas this year, with additional expansion planned for some time next year.

As part of the FTTH rollout in Austin, AT&T created a new executive position to lead the GigaPower initiative, naming Dahna Hull vice president and general manager, Austin, for AT&T Services Inc.

By announcing specific dates for its 1 Gbps launch, AT&T is showing that it’s serious about competing with upstart providers like Google Fiber (Nasdaq: GOOG), which named Austin as one of its service targets.

Today, the majority of AT&T’s FTTH deployments have been in new housing developments with property owners, including Dewhirst Properties in Knoxville, Tenn., via its Connected Communities unit.

Stopping short of revealing any specific future plans, it appears that the telco sees potential for FTTH in other areas besides Austin.

Randall Stephenson, AT&T's chairman, CEO and president, said during the recent Goldman Sachs 22nd Annual Communacopia Conference that improvements in deployment costs and more cooperation from local municipalities is making it easier for them to consider equipping other communities with FTTH.

CenturyLink uses Calix systems in Omaha gigabit FTTH pilot

Calix, Inc. (NYSE: CALX) has revealed that it has supplied its E7-2 Ethernet Service Access Platform (ESAP) and 700GE family of optical network terminals (ONTs) to CenturyLink (NYSE: CTL) for the carrier's gigabit fiber to the home (FTTH) pilot in Omaha, NE.

CenturyLink announced the trial this past May. The U.S. Tier 1 carrier hopes to serve as many as 48,000 homes and businesses in Omaha with symmetrical 1-Gbps services by the end of next month. The network will be based on GPON technology.

"Providing our customers with gigabit services 100 times faster than the average American download speed gives them the freedom to leverage the power of the Internet without bandwidth constraints," said Danny Pate, vice president and general manager of CenturyLink – Nebraska. "We are excited about the opportunities this Calix-enabled network has introduced to Omaha."

"The gigabit trial in Omaha is a great opportunity for CenturyLink to provide the businesses and residents in the pilot area a leap forward in broadband technology," added Matt Beal, CenturyLink CTO and executive vice president of corporate strategy and product development. "With the help of Calix, we look forward to seeing what our customers will do with their gig and how it provides us a competitive advantage."

In addition to the FTTH systems, CenturyLink will use the Calix Compass Flow Analyze software as a service application to both measure usage trends as well as to optimize service performance. Ericsson will provide professional services expertise to the project as well.

"We have seen gigabit deployments capture the attention of service providers around the world, as they examine the impacts and opportunities that these super-charged networks bring to the communities in which they are deployed, and to the service providers that deploy them," said John Colvin, senior vice president of North America sales and marketing at Calix. "With CenturyLink's bold gigabit network pilot in Omaha, we are seeing the promise of broadband unfold before our eyes. We are excited to be working with CenturyLink in Omaha as they leverage this gigabit network to deliver an entirely new level of broadband experience."