Abstract

The use of fiber will be inevitable for transporting hundreds of Mbits/s to and from end users, but this does not necessarily mean that fiber has to be deployed all the way up to a point in the home. An alternative is bringing fiber up to the home (hybrid FttH) and reusing existing telephony wiring to bridge the last 20–200 m. A new transmission technique is developed that makes this possible, G.Fast. We developed a techno-economic model to see whether this technique is feasible from an economic point of view. In this model we introduce a new method to estimate churn rates. We conclude that G.Fast is for most operators economically feasible in the short term, but more importantly, especially for operators who are limited in the deployment of FttH by working capacity, using hybrid fiber has a great effect on their market share. Hybrid FttH, using G.Fast, might be the best hope for European telecom operators to survive competition with cable TV operators.

© 2013 Optical Society of America

Full Article  |  PDF Article

References

  • View by:
  • |
  • |
  • |

  1. CELTIC-4GBB [Online]. Available: www.4gbb.eu .
  2. R. F. M. van den Brink, “Enabling 4GBB via the last copper drop of a hybrid FttH deployment,” , 2011 [Online]. Available: http://www.tno.nl/downloads/WP_Rob_van_den_Brink_Enabling%204GBB%20via%20the%20last%20copper.pdf .
  3. F. Phillipson, “A cost effective topology migration path towards fibre,” in 3rd Int. Conf. on Information Communication and Management (ICICM 2013), Paris, France, 2013.
  4. IST-TONIC [Online]. Available: http://www-nrc.nokia.com/tonic .
  5. CELTIC-ECOSYS [Online]. Available: http://www.celticplus.eu/Projects/Celtic-projects/Call1/ECOSYS/ecosys-default.asp .
  6. T. Rokkas, D. Katsianis, and D. Varoutas, “Techno-economic evaluation of FTTC/VDSL and FTTH roll-out scenarios: Discounted cash flows and real option valuation,” J. Opt. Commun. Netw., vol.  2, no. 9, pp. 760–771, 2010.
    [CrossRef]
  7. T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.
  8. S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.
  9. K. Casier, “Techno-economic evaluation of a next generation access network deployment in a competitive setting,” Ph.D. dissertation, Universiteit Gent, 2009.
  10. C. H. Antunes, J. F. Craveirinha, and J. N. Climaco, “Planning the evolution to broadband access networks: A multicriteria approach,” Eur. J. Oper. Res., vol.  109, no. 2, pp. 530–540, 1998.
  11. R. Zhao, L. Zhou, and C. M. Machuca, “Dynamic migration planning towards FTTH,” in Telecommunications Network Strategy and Planning Symp. (NETWORKS), Warsaw, Sept.27–30, 2010, pp. 1–6.
  12. K. Ahmed, P. Verhagen, F. Phillipson, and C. Smit, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 3—Techno Economic Modeling—TNO approach, TNO—CELTIC/4GBB project, 2012.
  13. H. C. Tijms, A First Course in Stochastic Models. Wiley, 2003.
  14. R. T. Rust and A. J. Zahorik, “Customer satisfaction, customer retention, and market share,” J. Retailing, vol.  69, no. 2, 193215, 1993.
  15. Vraag en aanbod Next-Generation Infrastructures 2010 tot 2020 (in Dutch), TNO, 2010.
  16. R. van den Brink and F. Phillipson, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 4—Techno Economic Calculations—TNO approach, TNO—CELTIC/4GBB project, 2012.

2010 (1)

2003 (1)

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

1998 (1)

C. H. Antunes, J. F. Craveirinha, and J. N. Climaco, “Planning the evolution to broadband access networks: A multicriteria approach,” Eur. J. Oper. Res., vol.  109, no. 2, pp. 530–540, 1998.

1993 (1)

R. T. Rust and A. J. Zahorik, “Customer satisfaction, customer retention, and market share,” J. Retailing, vol.  69, no. 2, 193215, 1993.

Ahmed, K.

K. Ahmed, P. Verhagen, F. Phillipson, and C. Smit, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 3—Techno Economic Modeling—TNO approach, TNO—CELTIC/4GBB project, 2012.

Antunes, C. H.

C. H. Antunes, J. F. Craveirinha, and J. N. Climaco, “Planning the evolution to broadband access networks: A multicriteria approach,” Eur. J. Oper. Res., vol.  109, no. 2, pp. 530–540, 1998.

Cadro, P.

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

Casier, K.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

K. Casier, “Techno-economic evaluation of a next generation access network deployment in a competitive setting,” Ph.D. dissertation, Universiteit Gent, 2009.

Climaco, J. N.

C. H. Antunes, J. F. Craveirinha, and J. N. Climaco, “Planning the evolution to broadband access networks: A multicriteria approach,” Eur. J. Oper. Res., vol.  109, no. 2, pp. 530–540, 1998.

Craveirinha, J. F.

C. H. Antunes, J. F. Craveirinha, and J. N. Climaco, “Planning the evolution to broadband access networks: A multicriteria approach,” Eur. J. Oper. Res., vol.  109, no. 2, pp. 530–540, 1998.

Elnegaard, N. K.

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

Forzati, M.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

Katsianis, D.

T. Rokkas, D. Katsianis, and D. Varoutas, “Techno-economic evaluation of FTTC/VDSL and FTTH roll-out scenarios: Discounted cash flows and real option valuation,” J. Opt. Commun. Netw., vol.  2, no. 9, pp. 760–771, 2010.
[CrossRef]

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

Kind, M.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

Lannoo, B.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

Machuca, C. M.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

R. Zhao, L. Zhou, and C. M. Machuca, “Dynamic migration planning towards FTTH,” in Telecommunications Network Strategy and Planning Symp. (NETWORKS), Warsaw, Sept.27–30, 2010, pp. 1–6.

Monath, T.

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

Phillipson, F.

K. Ahmed, P. Verhagen, F. Phillipson, and C. Smit, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 3—Techno Economic Modeling—TNO approach, TNO—CELTIC/4GBB project, 2012.

R. van den Brink and F. Phillipson, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 4—Techno Economic Calculations—TNO approach, TNO—CELTIC/4GBB project, 2012.

F. Phillipson, “A cost effective topology migration path towards fibre,” in 3rd Int. Conf. on Information Communication and Management (ICICM 2013), Paris, France, 2013.

Rokkas, T.

Rust, R. T.

R. T. Rust and A. J. Zahorik, “Customer satisfaction, customer retention, and market share,” J. Retailing, vol.  69, no. 2, 193215, 1993.

Smit, C.

K. Ahmed, P. Verhagen, F. Phillipson, and C. Smit, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 3—Techno Economic Modeling—TNO approach, TNO—CELTIC/4GBB project, 2012.

Tijms, H. C.

H. C. Tijms, A First Course in Stochastic Models. Wiley, 2003.

van den Brink, R.

R. van den Brink and F. Phillipson, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 4—Techno Economic Calculations—TNO approach, TNO—CELTIC/4GBB project, 2012.

van den Brink, R. F. M.

R. F. M. van den Brink, “Enabling 4GBB via the last copper drop of a hybrid FttH deployment,” , 2011 [Online]. Available: http://www.tno.nl/downloads/WP_Rob_van_den_Brink_Enabling%204GBB%20via%20the%20last%20copper.pdf .

Varoutas, D.

T. Rokkas, D. Katsianis, and D. Varoutas, “Techno-economic evaluation of FTTC/VDSL and FTTH roll-out scenarios: Discounted cash flows and real option valuation,” J. Opt. Commun. Netw., vol.  2, no. 9, pp. 760–771, 2010.
[CrossRef]

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

Verbrugge, S.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

Verhagen, P.

K. Ahmed, P. Verhagen, F. Phillipson, and C. Smit, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 3—Techno Economic Modeling—TNO approach, TNO—CELTIC/4GBB project, 2012.

Zahorik, A. J.

R. T. Rust and A. J. Zahorik, “Customer satisfaction, customer retention, and market share,” J. Retailing, vol.  69, no. 2, 193215, 1993.

Zhao, R.

R. Zhao, L. Zhou, and C. M. Machuca, “Dynamic migration planning towards FTTH,” in Telecommunications Network Strategy and Planning Symp. (NETWORKS), Warsaw, Sept.27–30, 2010, pp. 1–6.

Zhou, L.

R. Zhao, L. Zhou, and C. M. Machuca, “Dynamic migration planning towards FTTH,” in Telecommunications Network Strategy and Planning Symp. (NETWORKS), Warsaw, Sept.27–30, 2010, pp. 1–6.

Eur. J. Oper. Res. (1)

C. H. Antunes, J. F. Craveirinha, and J. N. Climaco, “Planning the evolution to broadband access networks: A multicriteria approach,” Eur. J. Oper. Res., vol.  109, no. 2, pp. 530–540, 1998.

IEEE Commun. Mag. (1)

T. Monath, N. K. Elnegaard, P. Cadro, D. Katsianis, and D. Varoutas, “Economics of fixed broadband access network strategies,” IEEE Commun. Mag., vol.  41, no. 9, pp. 132–139, 2003.

J. Opt. Commun. Netw. (1)

J. Retailing (1)

R. T. Rust and A. J. Zahorik, “Customer satisfaction, customer retention, and market share,” J. Retailing, vol.  69, no. 2, 193215, 1993.

Other (12)

Vraag en aanbod Next-Generation Infrastructures 2010 tot 2020 (in Dutch), TNO, 2010.

R. van den Brink and F. Phillipson, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 4—Techno Economic Calculations—TNO approach, TNO—CELTIC/4GBB project, 2012.

S. Verbrugge, K. Casier, B. Lannoo, C. M. Machuca, T. Monath, M. Kind, and M. Forzati, “Research approach towards the profitability of future FTTH business models,” in Future Network & Mobile Summit (FutureNetw), Warsaw, June15–17, 2011, pp. 1–10.

K. Casier, “Techno-economic evaluation of a next generation access network deployment in a competitive setting,” Ph.D. dissertation, Universiteit Gent, 2009.

R. Zhao, L. Zhou, and C. M. Machuca, “Dynamic migration planning towards FTTH,” in Telecommunications Network Strategy and Planning Symp. (NETWORKS), Warsaw, Sept.27–30, 2010, pp. 1–6.

K. Ahmed, P. Verhagen, F. Phillipson, and C. Smit, 4GBB Techno-Economic Feasibility and Regulatory Issues, Part 3—Techno Economic Modeling—TNO approach, TNO—CELTIC/4GBB project, 2012.

H. C. Tijms, A First Course in Stochastic Models. Wiley, 2003.

CELTIC-4GBB [Online]. Available: www.4gbb.eu .

R. F. M. van den Brink, “Enabling 4GBB via the last copper drop of a hybrid FttH deployment,” , 2011 [Online]. Available: http://www.tno.nl/downloads/WP_Rob_van_den_Brink_Enabling%204GBB%20via%20the%20last%20copper.pdf .

F. Phillipson, “A cost effective topology migration path towards fibre,” in 3rd Int. Conf. on Information Communication and Management (ICICM 2013), Paris, France, 2013.

IST-TONIC [Online]. Available: http://www-nrc.nokia.com/tonic .

CELTIC-ECOSYS [Online]. Available: http://www.celticplus.eu/Projects/Celtic-projects/Call1/ECOSYS/ecosys-default.asp .

Cited By

OSA participates in CrossRef's Cited-By Linking service. Citing articles from OSA journals and other participating publishers are listed here.

Alert me when this article is cited.


Figures (18)

Fig. 1.
Fig. 1.

Four topologies.

Fig. 2.
Fig. 2.

Overview of the techno-economic model.

Fig. 3.
Fig. 3.

Architecture of the network.

Fig. 4.
Fig. 4.

Four geometric models.

Fig. 5.
Fig. 5.

Result of churn, r = 0.05 .

Fig. 6.
Fig. 6.

Result of churn, r = 0.00 .

Fig. 7.
Fig. 7.

Expected broadband demand source [15].

Fig. 8.
Fig. 8.

Long-term market share for different average broadband demand.

Fig. 9.
Fig. 9.

Long-term market share per year.

Fig. 10.
Fig. 10.

Market share per year.

Fig. 11.
Fig. 11.

FttH growth as base scenario.

Fig. 12.
Fig. 12.

Penetration of technology in the case of constant adoption rate.

Fig. 13.
Fig. 13.

Results of constant adoption rate in millions of Euros.

Fig. 14.
Fig. 14.

Penetration of technology in case of constant building capacity.

Fig. 15.
Fig. 15.

Results of constant building capacity in millions of Euros.

Fig. 16.
Fig. 16.

Penetration of technology in case of constant investment.

Fig. 17.
Fig. 17.

Results of constant investment in millions of Euros.

Fig. 18.
Fig. 18.

Sensitivity analysis.

Tables (8)

Tables Icon

TABLE I Scenario Generating Example

Tables Icon

TABLE II Churn Figures Year 1 Area 1

Tables Icon

TABLE III Subscribers Area 1 Year 1

Tables Icon

TABLE IV Churn Results Area 1 Year 1

Tables Icon

TABLE V Subscribers Year 2

Tables Icon

TABLE VI Subscribers BoY 1–4

Tables Icon

TABLE VII Business Case Part 1

Tables Icon

TABLE VIII Business Case Part 2

Equations (9)

Equations on this page are rendered with MathJax. Learn more.

HCR * x MFR * ( ( R x ) * CTR + HCR * x ) .
x MFR * R * CTR HCR + MFR * CTR MFR * HCR .
π j = i = 1 n π i P i j , j = 1 , , n , i = 1 n π i = 1 .
E i t = T π i ( 1 + r ) t ,
P ( b ) = { b 0.5 b + 0.5 f ( x ) d x b > 1 0.5 f ( x ) d x b = 0 .
F = G m 1 m 2 r 2 .
F ( s , b ) = 1 ( s b ) 2
F total ( s ) = b = 0 F ( s , b ) * P ( b ) .
M ( s ) = F ( s , b ) s S F ( s , b ) .