Fiber Access Networks and The GPON Standard

1Calix Confidential & Proprietary

Fiber Access NetworksFiber Access Networksandand

The GPON StandardThe GPON Standard

David ClearyVP, Advanced [email protected]


Meeting Overview

AgendaThe Need for Fiber Access

The Choices of Access Networks

The GPON Standard

The Market Opportunities for GPON


Meeting Overview



The GPON Standard



The Need for Fiber Access

It’s all about Bandwidth!!!Video will drive Bandwidth for the foreseeable future

Bandwidth usage doubles every 18 to 24 months

MPEG4 offers some relief (18 to 24 months?)

How Much Bandwidth is enough?Probably more than you think.


The Need for Fiber Access

What is special about Fiber Access?Fiber is fundamentally different from copper

We are at the limit for bandwidth over copper Double the bandwidth and halve the reach

We are decades away from any limitations on fiber We are at 2.4 Gbps today Fiber can support over 100 Terabits per second without reducing

the reach

Eventually, every operator will deploy fiber...

It’s just a matter of time


Meeting Overview



The GPON Standard



The Choices for Fiber Access

There are 2 choices for Fiber Access:Point to Point

Point to Multi-point

Point to Point is sometimes called Active Ethernet

Point to Multi-point is called PON (passive optical network)

PassiveSplitters

ONT#192ONT #1ONT #1ONT #1ONT #1

...

PONOLT

ActiveEthernetSwitch

ONU#192ONT #1ONT #1ONT #1ONU #1

...


The Choices for Fiber Access

PassiveSplitters

ONT#192ONT #1ONT #1ONT #1ONT #1

...

PONOLT

ActiveEthernetSwitch

ONU#192ONT #1ONT #1ONT #1ONU #1

...

PON is analogous to wireless telephony (cellular)

Active Ethernet is analogous to wireline telephony

Both CapEx and OpEx cost savings favor PON


Meeting Overview



The GPON Standard



The Challenge

Low Volume

Small Customer pool

High customer influence

Edge/Core Network

Equipment


The Challenge

High Volume

Enormous Customer pool

Low customer influence

Consumer

Equipment

Edge/Core Network

Equipment

Low Volume

Small Customer pool

High customer influence


The Challenge

Consumer

Equipment

High Volume

Small Customer pool

High Customers influence is desired

Edge/Core Network

Equipment

Access Network

Equipment


Developing the Standard

The first step to writing a standard is to choose the Standards Body

The 2 primary players for networking standards are: IEEE (Institute of Electrical and Electronics Engineers)

ITU (International Telecommunications Union)


The IEEE

IEEE well known Protocols802.3 Ethernet

802.11 WiFi

802.16 WiMAX

IEEE Membership is diverseSystem vendors, chip vendors, optics vendors, industry cunsultants and academia

IEEE VotingEach member gets one vote

No limit to the number of votes from a given company

“Personality” of IEEE standards reflect interests of VendorsOften leads to low-cost solution

Often only hits 80% of market

Often doesn’t produce migration strategy

IEEE standards don’t necessarily reflect Operator Preferences


The ITU

ITU well known ProtocolsSDH

V 5.2

ISDN

VoIP protocols H.248 and H.323

ITU MembershipMembership controlled by ITU Member-Countries

Membership open to Operators, Institutions, and Vendors

ITU VotingVoting is through consent

Each company get one vote

Companies can object (but can’t stall process)

“Personality” of ITU standards reflect interests of OperatorsAddresses the operator requirements

Addresses the operator constraints

Addresses the service provider’s operational models

Not focused solely on low cost

Duration of Standardization Process relatively short


The ITU and FSAN

In the late 1990’s a “Clandestine” group of operators was formed:

Objective: “Global Domination of the Fiber Access Market”

The group called itself FSAN


The FSAN Committee

FSAN stands for Full Service Access Network

Loosely affiliated with the ITU

Develops all PON standards prior to submission to the ITU

FSAN membership consists of both operators and vendors

But operators make all final decisions

Membership of vendors is tightly controlled by FSAN Operators


NTT

KT

SingTel

Telstra

BellSouth

Bell Canada

AT&T

VerizonQwest

ChunghwaBezeq

FT

BT

DTAG

TI

Eirecom

KPN

Telia

Malta

Telefonica

SwissCom

FSAN Operators represent a world-wide membership

TelusKuwait MOC

Sprint

The FSAN Operators


FSAN OAN-WG membersFSAN OAN-WG members

OperatorsAT&TBell CanadaBellSouthBritish TelecomDeutsche Telekom France TelecomKorea TelecomKuwait MOCNTTQWESTSprintTelecom ItaliaTelstraTelusVerizon

VendorsAdtran LucentAlcatel MitsubishiAlphion MotorolaBroadLight NECCalix NortelConexant Novera OpticsECI Telecom OFN / OkiEntrisphere LG ElectronicsFlexLight Optical Zonu Freescale SamsungFujitsu SiemensHitachi TellabsHuawei TerawaveIamba Vitesse Infineon ZTE


Meeting Overview



The GPON Standard




There are Numerous Market Opportunities for GPONLower OpEx

Greater Service Offering

Future-proof investment

The real question is When and Where does it make economic sense to deploy GPON

The quickest application appears to be the Developer Market and ‘Smart FTTH’ Communities


Total U.S. Homes Served by FTTH

322,700

1,335,000

1,011,000

671,000

213,000146,500

78,00064,700

38,00022,50010,3505,5000

500,000

1,000,000

1,500,000

Sep-0

1M

ar-0

2Sep

-02

Mar

-03

Sep-0

3M

ar-0

4Sep

-04

Mar

-05

Sep-0

5M

ar-0

6Sep

-06

Mar

-07

Source: 2007 RVA


138,500

78,000

453,000

376,000

241,000

188,700

5,500 10,35022,500

38,00064,700

174,000

0

100,000

200,000

300,000

400,000

500,000

600,000

Source: 2007 RVA

Homes Served by FTTH by Non-Verizon Service Providers


436,000

882,000

0 200000 400000 600000 800000 1000000 1200000

RBOCs

All Other ServiceProviders

Breakdown of Homes Served:RBOC versus Non-RBOC FTTH

Source: 2007 RVA


0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2004 2005 2006 2007 2008 2009

BPON

GPON

EPON/GePon

Active/P2P

FTTH Homes Marketed By Architecture

Note: 2006 Forecast (2007 Forecast not yet available)

Source: 2006 RVA


Competing for Developers

New home developments have become the fastest growth Fiber-to-the-Home market

Master planned communities

Multi-tenant buildings

Resort communities

New service providers (developer integrators) are competing in this market against incumbents

Innovative and fast moving companies

Strong IP and project management experience

Strong ties to the developer and builder community


Overview of the Developer Market

FTTH is now highly desired by Developers

FTTH communities are most prevalent in:West Coast (California, Las Vegas)Southeast (Florida, etc.)

U.S. integrators expanding intoCaribbeanLatin America


U.S. Developer FTTP Market Size

1.5 million new homes per year are built in U.S. Source: U.S. Department of Commerce

50% are managed by Associations Source: U.S. Housing Census.

Half of these communities will deploy FTTP


Who is the Competition?

Over 50 companies are now acting as developer integrators in the United States and the Caribbean

Many have formed partnerships with specific developers for all their projects

Many companies specialize in security or ISPs

Very low overhead organizations

In most cases these integrators out source one or more of their services


Why Developers Choose Integrators

Developers want recurring revenue streams

Incumbents are perceived as unwilling to share revenue with developer

Incumbent telcos are seen as inflexible

Incumbents are perceived as not delivering newer service offerings


What is Required to Compete?

Minimal requirementsFiber-to-the-Premise architecture

Diverse video channel selection (IPTV or RF) News, movies, sports, etc

Voice (TDM or VOIP)

High speed internet 10 Mb+

Additional offeringsHome networking and support

Security systems

Video on demand

Community/member web site

Video doorman and camera integration


Closing remarks

ICT Infrastructures are best delivered with GPON and FTTH technologies


The Power of SimplicityThe Power of Simplicity

Fiber Access Networks and The GPON Standard

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