Do Recent Events Vindicate FTTN Approaches?

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One of the more interesting debates of the past few years was whether telephone carriers moving to fiber architectures are best off deploying it all the way to the end customer or stopping short of the final destination. The labels for these approaches are surprisingly intuitive, considering they were coined by engineers: The all-the-way group advocates fiber-to-the home (FTTH) and fiber-to-the-premise (FTTP), while the close-but-no-cigar crowd advocates fiber-to-the-node or fiber-to-the-neighborhood (both FTTN) or fiber-to-the-curb (FTTC).


This latter approach relies for the last few feet or yards on existing copper. The tradeoff is clear: FTTN/FTTC is cheaper because it uses an existing asset and because the transition from the optical to the electrical domain-and the reverse in the upstream direction-is done for more homes or offices at once than in the FTTH/FTTP scenario. FTTP/FTTH, in turn, offers something in exchange for that extra cost: More bandwidth.


In the United States, the two biggest carriers' approaches showcased the stark contrast. Verizon FiOS takes fiber all the way to the premises, while AT&T elected to stop short in the U-verse project.


It's unfair, though tempting, to pick a few data points and say that one side was right and the other wrong. It's too simplistic to draw such a broad conclusion. By the same token, however, it is fair to point those data points out. In this case, it seems that factors that were impossible to predict when these architectural decisions were made-the explosion of wireless and the deep recession -- suggest that FTTN/FTTC may, at least in the short term, look like the better choice.


Three pieces of news back this idea. The first is that Verizon signed a relatively low total of 153,00 new FiOS customers during the fourth quarter of last year. Though the yearly total was up 34 percent and the total was 45,000 more than last year, observers point to a slowdown in the second half of the year and paint the results as suggesting that the company slowed down.

The second indicator is the success of U-Verse. Multichannel News points out that the AT&T service netted 248,000 new customers during the fourth quarter, giving it a total of 2.1 million. The carrier has added more than 240,000 customers for five consecutive quarters. Verizon, the piece says, laid off 13,000 workers during 2009 and may do the same this year.

Finally, Bell Canada has opted for a U-verse-like FTTN approach
Its new Fibe service, besides having a name that looks like a typo, relies on a copper technology called VDSL2+ to reach the customer. There will be four speed options and capacity caps, the story says. The DSL Reports' writer makes the point that the name Fibe may be intended to trick people into thinking that it is an all-fiber service.


Three data points are just that-three data points. However, it's worth noting when they all line up on the same side of the ledger.