Presented by: Michael C. Render
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Transcript of Presented by: Michael C. Render
Presented by:Michael C. Render
North American FTTH: 10 Year Report Card
FTTH's Second Decade Begins:Where We Are, Where We Are Going
Has FTTH Had An Impact?
Economy
Quality of User Experience
New Technology
Has FTTH Become A Household Name?
Consumer Recognition
Have We Overcome Challenges?
Political
Funding
Has FTTH Deployment Grown? Will It Continue?
Greenfield Construction
Existing Overbuilds
“Has FTTH Had An Impact?”….
….Economy (Grade: A)
How would you best describe the organization you work for?
Select one:
• RBOC• ILEC• CLEC• MSO• Municipal government• State or regional government• Real Estate Developer/Integrator• End-user business• Consultant• Equipment vendor• Contractor
Billions In Home Based Business Impact
- Average revenue from home- based businesses in FTTH homes is $59,780
- Revenue for FTTH home-based businesses is $46.7 Billion
- Revenue estimated to be related to FTTH performance is $11.1 Billion *
* 11% said their business would not be possible without FTTH, and 64% said it is more efficient
FTTH Enhanced Home -Based Business Reported
Billions In Traditional Economic Development/GDP Growth
Auburn IN Cooper Tire Expansion Kutztown PA Film production companies
Bristol TN LENOSIWSCO VA Data Centers
Bristol VA Mason County WA CGI Louisville Slugger
SimsYahoo Technology companies
Online engineering firmsMorristown TN Colgate Palmolive
Grant County WAPowell WY Alpine Access Virtual Call Center
IntuitWindom MN Trucking companies
Independence OR Metal fabrication companies
MSN (Microsoft)Ask Jeeves
Douglas County WA Sabey Corporation
Chelan County WA
Media General
Northup Grumman
Billions In Environmental Savings
- 1 day per month average (Nearly 12% work more from home directly because of FTTH – an average of 9 days more)
- US Carbon Emissions reduced by .06% (5.5% of citizens * 3% * 40%)
- FTTH also lowers energy use, road maintenance, accidents, unproductive hours…
Days worked from home increased 1 day per month on average:
Extra Days From Home Reported
“Has FTTH Had An Impact?”…
…Quality of User Experience (Grade: A+)
Reliability – service uptime
Broadband speed
Installation process
Consistency of speed
Provider’s customer service
Much Higher Satisfaction With Internet Aspects FTTH Versus Cable Modem
12
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
76%
69%
65%
56%
48%
39%
38%
37%
Column2
Cable
Quality of HD picture
Standard television
Number of HD channels
VOD
Much Higher Satisfaction With Television Aspects FTTH Versus Cable
13
16.6
12.2
7.0
5.2
10.8
6.9
1.52.9
0
2
4
6
8
10
12
14
16
18
20
2007 2008 2009 2010
FTTHCable modemDSL
Much Higher Tested Download PerformanceMedian Mbps By Year
4.5
2.4
1.8
1.01.4
0.50.4
0.7
0
1
1
2
2
3
3
4
4
5
5
2007 2008 2009 2010
FTTHCable modemDSL
Much Higher Tested Upload PerformanceMedian Mbps By Year
FTTH
DSL
FTTN
Cable modem
Wireless
Far Fewer Modem Reboots Reported Per Month
16
Speed/ faster/ better Internet/ bandwidth Picture clarity/ video clarity
Reliability/ consistency/ no hassles Bundle of several services on one bill
Cost Fewer weather disruptions
Quality Number of channels/ entertainment choice
Better customer service General positives - pleased to have it
DVR Convenience
Better than previous cable company Video-on-demand/ movie downloads
No satellite dish Better technology/ up-to-date
Lines are buried/ No overhead Can run two computers at once
Easy installation Other
Users Clearly Understand Key Advantages Of FTTH
Open End Responses
17
“Has FTTH Had An Impact?”…
…New Technology (Grade: C)
Shop online
Play single player games
Upload large files
Download or stream video to computer
Play multi player games
Upload video content to Internet
Use VOIP for audio
Use two-way video conferencing
Transfer files for remote offsite storage
Download or stream video to television set
Use remote software / “cloud computing”
Use remote monitoring camera video
Participate in a virtual world
Some Increased Use Of Advanced Internet Applications
Among FTTH Users Under Age 40 By Year
19
Business video conferencing
Very large HDD with super resolution
Advanced websites/ full video
Remote home and pet monitoring
Online face-to-face healthcare
Advanced online shopping
One device for TV, Internet, & phone
Two-way video calling
Advanced online college
3D TV
There Is Interest In Futuristic Services Current FTTH Users Under Age 40
20
Online face-to-face healthcare
Very large HDD with super resolution
One device for TV, Internet, & phone
Advanced online shopping
Two-way video calling
Remote home and pet monitoring
Advanced websites/ full video
Business video conferencing
3D TV
Advanced online college
There Is Interest In Futuristic Services Current FTTH Users Age 55+
21
4.5
2.4
1.8
1.01.4
0.50.4
0.7
0
1
1
2
2
3
3
4
4
5
5
2007 2008 2009 2010
FTTHCable modemDSL
FTTH Upload Performance Will Become A Competitive Advantage
Median Mbps By Year
“Has FTTH Become A Household Name?”…
…Consumer Recognition (Grade: C)
2009
2010
General Public Awareness Of FTTH Is Still LowBy Year
24
Non FTTH Users:
Internet from a direct fiber optic line
Green space / walking, jogging
24 hour neighborhood patrol
Community pool / park
Fitness center / Clubhouse
Current FTTH Users:
Internet from a direct fiber optic line
Green space / walking, jogging
24 hour neighborhood patrol
Community pool / park
Fitness center / Clubhouse
Yet When Described, Users Understand The Importance Of FTTH In New Home Development
25
“Have We Overcome Challenges?”…
…Political (Grade: A)
“Have We Overcome Challenges?”…
…Funding (Grade: B-)
Nearly $40 Billion In Investment To Date
Total U.S. Telco & Cable Capital Expenditures Are Stable
2007 2008 2009 2010P
RBOC Wireline $25.23 $25.41 $22.00 $19.40 Internal ReportsWireless(RBOC & Other) $19.87 $20.90 $21.40 $25.20 Inernal reports / TreflisMSO's $12.00 $11.40 $10.50 $11.00 Skyline MarketingILECs CLECs $4.00 $5.10 $3.90 $4.10 Skyline MarketingTotal $61.10 $62.81 $57.80 $59.70
Alternative source (total): $61.60 $56.90 $57.70 Avian Securities
Total North American Telco & Cable Capital Expenditures Are Stable
2007 2008 2009 2010P
TOTAL US $61.10 $62.81 $57.80 $59.70 Combined RVATOTAL Canadian $8.40 $8.50 $9.70 $9.00 IDCTOTAL US & Canada $69.50 $71.31 $67.50 $68.70
But There Is Competition For Telecom Capex
16.6
12.2
7.0
5.2
10.8
6.9
1.52.9
0
2
4
6
8
10
12
14
16
18
20
2007 2008 2009 2010
FTTHCable modemDSL
Tested Download Performance Of BroadbandMedian Mbps By Year
DSL broadband speeds are falling far behind the competition. Telcos are starting to lose subscribers and need an FTTH update. This is reaching severe levels in some areas, such as eastern Canada.
WirelessWireline
Smartphone penetration is expected to increase from 15% to 70% in just three years with the increasing use of higher bandwidth applications. Some see this as an impending crisis.
30
National public investment
Private investment
Other Investment Offers Opportunities
Municipal public investment
“Has FTTH Deployment Grown?”…
…Greenfield Construction (Grade: B-)
…Existing Overbuilds (Grade: A-)
FTTH Homes Passed Have Grown Cumulative – North America
100 x Growth since 2001
FTTH Homes Connected Have Grown Cumulative – North America
FTTH Penetration Has GrownCumulative – United States
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
PassedConnected
But FTTH Penetration Is Not UniformPercent Of Households Connected
+
2006 2007 2008 2009 20100%
10%
20%
30%
40%
50%
43.6% 41.1% 44.0%
39.7%
41.4%39.7% 41.0%
41.2% 40.4%
35.8%
11.9%13.1%
8.9%
11.9%13.4%
4.0% 3.0% 2.4%
3.2%3.3%
0.8% 1.8% 3.4%
4.8% 6.1%
Cable modem
DSL
Wireless
Other broadband
FTTH
FTTH Internet Use Has Steadily Grown Broadband Type Primarily Used At Home
USA By Year
There Has Been Some Short Term Slowing Of Growth
3,454,876
2,716,967
9,874 109,190
2,283,624
4,170,628
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
FTTH Homes PassedAnnual Change – North America
1,118,7701,165,683
5,569 41,813 177,271
1,603,066
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
FTTH Homes ConnectedAnnual Change – North America
164,252
643,967
481,945
359,856
280,133
149,853
109,5822,000 12,852 55,646
140,622
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Greenfield FTTH Homes Connected Will IncreaseAnnual – North America
1,273
1,4991,716
1,046
622
447600
9501,100
1,250
1,300
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
Single Family Housing StartsAnnual – North America
Greenfield Will Finally Take Off As Older Copper-Based Developments Are Filled
2000-2004 (9 million lots developed, 2.5% FTTH)2005 (2 million lots developed, 15% FTTH)2006 (1.3 million lots developed, 37% FTTH)2007 (.9 million lots developed, 50% FTTH)2008 (.4 million lots developed, 55% FTTH)2009 (.4 million lots developed, 60% FTTH)2010 (.62 million lots developed, 62% FTTH)2011 (.66 million lots developed, 64% FTTH)2012 (.8 million lots developed , 66% FTTH)2013 (.81 million lots developed, 69% FTTH)2014 (.87 million lots developed, 70% FTTH)2015 (1.2 million lots developed, 73% FTTH)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
10%
6%
16%
65%
3%
Very unlikely
Somewhat unlikely
Somewhat likely
Very likely
All customers have FTTH
Likelihood Of Overbuilds Still Look Good In Many Sectors
Adding FTTH: Current Non RBOC FTTH Providers
43
Telecom Video Was An Early DriverFTTH Video Homes Connected
Cumulative – North America
MSO’s (Docsis2, Docsis 3)
Verizon (DSL, FTTH)
Other RBOC (DSL, FTTN)
Broadband Line Loss Will Become A DriverNet Broadband Adds 2009
45
Source: Leichtman Research
0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%
3.2%
1.3%
1.1%
MSO’s (Docsis2, Docsis 3)
Verizon (DSL, FTTH)
Other RBOC (DSL, FTTN)
46
Source: Leichtman Market Research
Broadband Line Loss Will Become A DriverNet Broadband Adds First Half 2010
How many additional North American homes do you expect to be passed by FTTH or FTTB in next
5 years (by the end of 2015)?
Select one:• 3 million or less• 6 million• 9 million• 12 million• 15 million or more
Note: Much of the RBOC decline has already occurred.
North American FTTH Will Begin A New Mild Increase- With More Explosive Growth Possible
Key:Yellow – stableLight green – moderate growthDark green – strong growth
REPORT CARDGrading Period: Yrs 1-10 11-20 21-30
IMPACTS:Economy AQuality of User Experience A+New Technology C + CONSUMER RECOGNITION: C GROWTH:Greenfield B-Existing Overbuilds A-
OVERCOMING CHALLENGES:Politcal AFunding B-
GRADE AVERAGE B
Overall… The FTTH Picture Looks Positive!
Q&A
Broadband Properties Magazine homepage: www.bbpmag.com
Also at Broadband Properties Magazine: www.munibroadband.com
For a replay of this Webinar, and for upcoming webinar events, don’t forget to check out our municipal broadband webinar site at www.Muniwebinar.com
Contact Mike Render at [email protected] Or visit www.RVALLC.com
For the complete report of FTTH deployment in our October issue, featuring Mike Render’s data:www.bbpmag.com/2010mags/oct10/BBP_Oct10_FTTHMarketReport.pdf