FTTx DEPLOYMENT TRENDS AND TECHNOLOGY EVOLUTION

2

100 MBPS COVERS HIGH-END USER DEMAND BY 2020

0

10

20

30

40

50

60

70

80

90

100

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Vid

eo B

andw

idth

(M

bps)

3DTV 2160p

HDTV 2160p

3DTV 1080p

HDTV 1080p

3DTV 720p

HDTV 720p

SDTV

15% CAGR

Source: Alcatel-Lucent

3

MARKETING BANDWIDTH IS STILL IMPORTANT

END-USER INTEREST IN

MEGAHERTZ

END-USER INTEREST IN

MEGAPIXELS

Source: Google Trends

END-USER INTEREST IN

MEGABIT

4

FACTORS INFLUENCING

FTTx STRATEGY SELECTION

Building owners know there

are government broadband

targets, and have started to

charge money to enter

buildings

Operator in APAC

30% of FTTH subscribers

change their mind when

the engineer asks where he

can drill holes in the wall

for the fiber

Operator in Europe

To connect 7,000 house-

holds, we needed 30,000

phone calls in 40

languages just to schedule

home visits

Operator in Western Europe

Engineers are not allowed

to enter the home if the

husband is not at home, and

need to reschedule the

appointment

Operator in the Middle East

5

SOLVING THE BITRATE EQUATION

2

4

6

8

10

12

14

16

18

ADSL/CO FTTN 250 subs

FTTCurb 48 subs

FTTB 32 subs

FTTPole 16 subs

FTTWall 1 sub

FTTH

Other Factors

Home Connection & Installation

Home Equipment

Civil Works & Cables

Cabinets or POPs

Splitters

Equipment

FTTx COST COMPARISON, CAPEX + INSTALLATION

INVESTMENT • From FTTN (4x) to FTTH (15x)

• The closer to the subscriber, the

closer the cost to FTTH

1

TIME TO MARKET • Deploying FTTH is time consuming

• Re-using existing copper can speed

up deployment

2

BANDWIDTH • FTTH: 1G and more

• FTTx: 100M (VDSL2 Vectoring

today), G.fast evolution to 100s

3

OTHER FACTORS • (-) Aerial fiber, existing ducts

• (+) difficulty to enter the home

4

6

SERVICE PROVIDERS MIX COPPER AND FIBER

TO REDUCE COST AND ACHIEVE FAST TTM

FTTB

FTTN

CO

FTTH

Strategy

Exploring

Vectoring plans publicly announced

FTTdp

7

VECTORING

Removing the Copper Speedbump

EACH VDSL2 LINE

INTERFERES WITH OTHER

LINES IN CABLE BUNDLE

BUNDLE WITH COPPER PAIRS

(TELEPHONE LINES)

0

20

40

60

80

100

120

100 200 300 400 500 600 700 800 900 1000 1100 1200

at 400m

with normal VDSL2

40Mbps

100Mbps at 400m

with VDSL2 Vectoring

Dow

nst

ream

bit

rate

[M

bps]

Distance[m]

Optimal VDSL2 performance

8

100Mbps @ 400m

DOWNSTREAM 40Mbps @ 400m

UPSTREAM SAME PERFORMANCE

FOR ALL LINES =

VECTORING DELIVERS PREDICTABLE HIGH SPEED FOR ALL LINES

SINGLE LINE RATE

VECTORING RATE

VDSL2 RATE

9

FTTH FTTCurb FTTN

1000s-

10000s

100s

10s

From ultra-

high capacity

FTTH …

FTTB

… over FTTN/B

solutions with

vectoring …

… to flexible

FTTCurb micronodes

with vectoring

FTTdp The End to end Story

10

NEXT IN DSL: G.FAST

HIGH BITRATES •Standard targets:

• 150Mbps @ 250m

• 200Mbps @ 200m

• 500Mbps @ 100m

• Up to 1Gbps <100m

3 SHORT DISTANCE • To reduce attenuation at high

frequencies 2

BIT

S /

s /

Hz

106MHz 212MHz

VDSL2 VECTORED

FREQUENCY [MHz] 17MHz

G.FAST VECTORED

0

1

3 2

MORE BANDWIDTH • G.fast: up to 106 or 212 MHz

• Limitation on bits/s/Hz to

manage design complexity

1

11

TYPICAL APPLICATIONS FOR

G.FAST & G.FAST VECTORING

FTT… NODE CURB MANHOLE POLE WALL FRONTDOOR BUILDING

>200 METER

> 100 SUBS

VDSL2 VECTORING

<200 METER

10s OF SUBS

VDSL2 VECTORING

EVOLUTION TO G.FAST VECTORING

10s OF METERS

1 SUB

VDSL2

EVOLUTION TO G.FAST

a.k.a. “FTTdp”

(Distribution Point)

12

FTT-DP – Fiber to the Drop Point

Fiber to The Drop Point : 1 to 1

Allow to offer GPON connection to end users refusing

installation of an ONT: 30% of the subscribers

SFU: single Family Unit.

No MDUs or multi subscribers interfaces

Indoor device only as first step

Service delivery

o target performances at 100 meters: > 100Mbps

oVDSL2 profile: 17a with evolution to 30a (HW ready)

o No Coax cable

o Reverse Power feeding

o Customer self-install

oFall back scenario: ADSL2+ with By-pass

mechanism: loss of power, churn, installation

1 DPU per apartment

Active equipment

~FTTH

single-port DPU CPE

CPE

CPE

single-port DPU

Optical connection box

G-010V-P

BRING VDSL2 NEAR/IN THE HOME

GPON uplink

G-010V-P

VDSL2

Reverse

Power

• GPON ONT with VDSL2 port as user interface

• Allows to bring GPON to the home, without having to touch in-house CAT3 wiring.

• First product: SFU

­ Single family unit (single VDSL2 port)

• Indoor installation only at the start

• VDSL2 17a & 30a support

• Target service delivery: > 100 Mbps DN / 50 Mbps UP

• G.INP (physical retransmission) and SRA

• Reverse power feeding

• Customer self-install

• Fall back using by path relay in case ONTs is out of service

15

• Dimension Targets (indoor, now inclusive cable protection) :

­ 200 * 98 * 45 mm INCLUSIVE PROTECTOR

VDSL2 Indoor ONT G–010V-P

• Copper pairs: 2 connectors

­ Line to_CO and line to_CPE: RJ-45 connectors

• 1 optical connector

• 2 connectors :

­ CRAFT : RJ45 : (Serial Link)

­ Connector for external alarms collection

­ 1 barrel connector for External power

FIBER TO THE DISTRIBUTION POINT (FTTdp)

VDSL2 (17a, 30a) NOW, G.FAST IN 2015

• Gradual deeper fiber deployment: FTTdp / FTTB

• To boost bit rates beyond what is possible from cab

• To optimise Cost of fiber deployments

• Multi-port DPU (distribution point unit)

• Typically requires vectoring (or anti-crosstalk)

• Typically reverse powered (shared)

• Open for outdoor deployment. Vectoring not in scope for indoor

• Facilitate FTTH

• Stay out of house / apartment with fiber

reduce cost of FTTH

• Single-port DPU

• No vectoring needed

• Reverse powered (independent per user)

single-port DPU CPE

1 DPU per apartment

CPE

CPE

CPE

CPE

CPE

multi-port DPU

FTTB ~FTTH

FTTcurb

manhole,

mini-cabinet,

pole-mount, …. single-port DPU

multi-port DPU

Remote Power Feeding

Local Power Feeding

Reverse Power Feeding

CO DPU CPEs

CO DPU

CO DPU

CPEs

CPEs

CPEs

CPEs

CPEs

Reverse Power Feeding of DPU

Deployment Example outdoor :

Save on DROP Fiber cost and Home rewiring

ONTpc

ONTpc

Splitter

Fiber

VDSL Modem

+ PoE Injector

ONT

FTTdp

FTTH

Splitter

IP Network

Existing copper cable

Client

Optical fiber

GPON

ONT

V2CO

Bridge

Distance <200m OLT

Strategy FAST BROADBAND

Solving the bandwidth - cost - time equation:

Combining fiber, VDSL2, Vectoring, and Bonding to deliver 100Mbps & beyond

VDSL2 ~40 Mbps

CO

ADSL2+ ~10-20 Mbps

VDSL2 Bonding

~80 Mbps VDSL2 ~40 Mbps

VDSL2 Vectoring ~100 Mbps

VDSL2 vectoring at DP

~100-200 Mbps

FTTN

PON/P2P 500+ Mbps

CO

FTTB

VDSL2 Vectoring ~100 Mbps

FTTDP FTTDoor

OLT

Switch/ Router

ISAM FD/FX

5520 AMS

Just Plug It In

• Use Existing off-the-

shelf routers and

switches

• Plugs into WAN or uplink

SFP cage

• VLAN Tagging/ Retagging

/Priority Setting, MPLS etc. to

ensure service SLAs

• GPON for Cell Back

Haul

• GPON to feed DSLAMs

ACCELERATE CONNECTIVITY WITH GPON SFP ONT ENTERPRISE, CELL/WIFI BACK HAUL AND DSLAMS

Base Station

DSLAM

ALCATEL-LUCENT GPON SFP ONT

SFP ONT Features

• Fits in standard MSA cage

• GPON G.984.1,2,3

• B+ optics (28db optical budget)

• Ethernet Packet Forwarding @ GE Wireline speed

• Tagging/Retagging/Priority Bit setting

• Full video support with Multicast, IGMP v2 & 3 snooping, expedited leave, IGMP rate limiting

• Operating Case Temp -30 C to +75 C

• Dimensions (LxWxH) 7.5 cm x1.39 CM x 1.245 cm

SFP ONT Use Cases

Alcatel-Lucent

lightRadio™

9964 LTE

OLT

GPON

SFP

Alcatel-Lucent 7210 SAS-D

3rd party

Alcatel-Lucent SFP-ONT

O-010S-P -40 C +80 C

I-010S-P -5 C +70 C

•ALU recommends to perform pre-validation as the SFP’s power consumption is higher than typical SFP (2W typ / 2.6W max) •Yield on I-temp is low. Offer C-temp wherever possible.

Just plug GPON in into any appliance equipped with a standard SFP cage

Any subscriber Address residential, business and backhaul with one ONT type

Upgrade point-to-point sites Enjoy the OPEX reduction of PON without replacing CPE

Redefine the Residential GW Introduce new gateways without qualifying new ONTs

Alcatel-Lucent

7356-SA (REM)

Fiber to the Most Economical Point

FTTx = FTTH + FTTC + FTTdp

An Economical Analysis

€768

€ 0

€ 200

€ 400

€ 600

€ 800

€ 1,000

Y1 Y2 Y3 Y4 Y5 Y6

Euro

s (M

illio

n)Capex - HHP Capex - HHC Opex TCO (PV)

Option 1 TCO: Deploy FTTH from Day 1 at Full Speed

TCO PV (6 years)

4 % 13 % 24 % 35 % 42 % 44 %

1 Million

HHP

Take-rate

26

€285

€733

€ 0

€ 100

€ 200

€ 300

€ 400

€ 500

€ 600

€ 700

€ 800

Y1 Y2 Y3 Y4 Y5 Y6 Y7

Euro

s (M

illio

n)Capex - HHP Capex - HHC Opex TCO (PV)

Option 2 TCO: Deploy VDSL2 First and Upgrade to FTTH in future (> 4 years)

Ramp up subscriber take-rate to 44%

on VDSL2-BR

Upgrade to FTTH TCO PV (4 years)

TCO PV (7 years)

11 % 22 % 33 % 44 % 44 % 44 % 44 % Take-rate

1 Million

HHP

€(307)

€24€(5)€(5)€(5)€(5)

€(16)€(36)€(55)

€(197)

€(329)

€238 €238€238

€71€131

€190€226 €238 €238

€231€141

€43

€(66)

€(185)

€(471)€(520)

€(258)

€(428)

€(310)

-€ 600

-€ 500

-€ 400

-€ 300

-€ 200

-€ 100

€ 0

€ 100

€ 200

€ 300

Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10

Euro

s (M

illio

n)Yearly TCO Yearly Revenues CDCF

Option 1 (FTTH Only): 10 year Business Case including Revenue*

Long Pay Back Year (7-8) – Difficult Business Case

* ARPU (VDSL2) = 40 euros/month; ARPU (FTTH) = 45 euros/month

4 % Take-rate 13 % 24 % 35 % 42 % 44 % 44 % 44 % 44 % 44 %

€(202)

€53

€(2)€(2)€(2)€(38) €(45)€(53)

€(318) €(306)

€(151)

€238 €238€238€238€232€222€211€158

€106 €114€167

€54

€267€358

€(136)

€6

€(79)

€12€57

-€ 400

-€ 300

-€ 200

-€ 100

€ 0

€ 100

€ 200

€ 300

€ 400

Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10

Euro

s (M

illio

n)Yearly TCO Yearly Revenues CDCF

Option 2 (VDSL2 with FTTH Upgrade): 10 Year Business Case incl. Revenue*

* ARPU (VDSL2) = 40 euros/month; ARPU (FTTH) = 45 euros/month

11 % Take-rate 22 % 33 % 44 % 44 % 44 % 44 % 44 % 44 % 44 %

3 Year Payback + CDCF is 55% higher than Option 1