FTTH in France : a case study - WIK · FTTH in France : a case study Vianney Hennes 23 March 2009,...
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Transcript of FTTH in France : a case study - WIK · FTTH in France : a case study Vianney Hennes 23 March 2009,...
2 The French case
Agenda
Part 1 FTTH competition : from the idea to the implementation
Part 2 Strategy confirmed
Part 3 Current debates and impacts
3 The French case
1
2
the vision…
It is not about competition at retail level…
– Will be delivered in any case, either as a consequence of network competition or through access regulation
It is about network competition
– FTTH represent an opportunity for more competitionat network level
– Delicate balance for NRAs on NGAs– Strong bias in favour of access would deliver a
new network monopoly– Technology + regulation could produce “pure
reselling” in the end
4 The French case
The French Regulatory Framework
Access to ducts– First offer end of 2007– Experimental contracts in
2008– First commercial contract e.o.
2008– Market Analysis and
obligation in July 2008
But FTTH is also rolled-out in non-telco ducts
– Paris, Hauts-de-Seine, Montpellier,…
– Cable
Law (“LME”) to impose symmetrical obligations in buildings
– Making easier for operators to install fibre on private property
– Mutualisation under the control of ARCEP
– Pre-equipment in new buildings
?
5 The French case
1
2
….the method
A well functioning broadband market:
- DSL : 98% pop/55% pen
- LLU: 75% pop, 3P: 50%
Effective, non-discriminatory access to existing ducts
Symmetrical sharing of intra-building wiring
Customer connection
Service duct
Optical connection cabinetTowards SP
Pb
PRI
3rd party
3rd party
37mm74/224/6
Opérateur 1 ?
Opérateur 3 ?
Opérateur 2 ?
Câble réseau existant 30% d'occupationAlvéole 75/80mm
3
6 The French case
First results
2006 : Pilot
2007-2008 : pre-deployment
December 2008
– 21,600 customers out of over 500,000 connectable households at end 2008
2009: pre-deployment continues Roll-out slowed down due regulatory uncertainty on the location of the point of mutualisation and other measures – no more extensions of coverage
Metz
Lille
Nantes
Poitiers
Bordeaux
Lyon
Grenoble
Nice
Marseille
Toulouse
Paris
HDS
7 The French case
PON allow operators to re-use existing ducts
Other advantages of PONBroad but selective deploymentIndependent of habitation structure (Indiv. housing, MDUs)Scalable (coverage, take-up)Future-proof (active, passive)
Duct-sharing works in practiceMultiple cases already with several operators, in several large cities and in several Paris suburbsAlmost no saturationWhen availability is confirmed, implementation is common sensePON delivers: less fibres, less handling, less consumption
P2P
28 cables 720f f ∅ 18 mm
For 20 000 clients
∅ 80 mm duct
(transport)
1 cmGPON (÷64)
3 cables 144 f ∅12 mm
P2P
8 The French case
4 players so far, 2 debates
4 Players investing in fibre today
– 2 players rolling out PON – FFTH– 1 player rolling out P2P – FTTH – Numéricable already upgraded its network to FTTB
Technical choices
– Deployment, Servicing– Churn– Costs…
Network competition
– Requires a point of flexibility close to the subscriber, preferably in the building
– Law stipulates PM should be in the street in principle Experimentation
9 The French case
Debate N°1 : “mono-fibre” vs. “multi-fibre”, a case for “efficient investment”
As many fibres/sockets as potential operators installed in every flat:
– “do it yourself” approach in principle
– but:– acceptable to
customers?– Substantial additional
costs (30 to 40%)– Does not eliminate
intervention at the point of mutualisation
– Costs will increase with the distance to the point of mutualisation
One fibre per flat
– Customers want 1 socket– Is totally compatible with
competition due to the existence of the Point of Mutualisation
– Entirely neutral vs fibre architecture (PON or P2P)
– Makes churn easy at less cost than multi-fibre
+ 30-40%
10 The French case
Debate n°2: the location of the point of mutualisation, another case of “efficient investment”
– Additional investment costs (cable, cabinets, “rugged” components)
– Additional service costs (public domain)
- Complex process of coordination and planning
- Unclear frontiers of responsibility
Up to x10
PM will be outside of the building in most of the cases. Above 10/12 units it is much more economical to locate the PM inside.
12 The French case
FTTH competition is sustainable in France
Ducts capacity is constrained but not scarce
– 3 FTTH can be rolled-out in parallel to the existing copper networkDifferent strategies, different economies
– For Orange : it is about innovation and future revenues & services– For competitors, FTTH represent an alternative to Full LLU. Savings
would entail a 10€/access/month gross margin increase in major cities
Market penetration (3-4 players)
– In 50% of the market, a full “copper to FTTH” migration on 20 years would result in little change in the value of access
– Additional 20% are realistic (learning curve, technology, change in demand)
– 30% may not justify network competition ; de facto monopoly (or no network)
13 The French case
Technical progress and infrastructure competition
Technology of FTTH rollout progresses rapidly
– Smaller sharing points– Smaller connecting
points
And justifies infrastructure competition
– “dynamic gains” larger than “static extra-costs”