Session 8. Economic Impact of Broadband. Economic Impact of Broadband Implementation: Service bandwidth upgrade and Broadband access technology
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1 ITU-D D Regional Development Forums 21 on NGN and Broadband (ARB, EUR & CIS Regions): NGN and Broadband, Opportunities and Challenges Session 8 Economic Impact of Broadband Implementation: Service bandwidth upgrade and Broadband access technology Ignat Stanev HCTP/ITC, Bulgaria ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 1 Content of the presentation : Economic Impact of Broadband Implementation Problem 1 Service bandwidth upgrade on FTTH broadband access network on xdsl broadband access network Problem 2 Selection of broadband access technology xdsl vs. FTTH for urban brownfield area FTTH vs. WiMAX for urban greenfield area xdsl vs. WiMAX for rural area ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 2 1
2 Problem 1 Service bandwidth upgrade There is a need to model the impact of upgrading the service bandwidth bandwidth, the service take rate and the service mix on the access network. For a given market, the access network planners want to perform Bandwidth Upgrade Scenarios, Uptake Growth Scenarios, and Service Mix Scenarios The access network planners have to dimension the required capacity of the access nodes, to optimize the access network and to calculate related costs to upgrade it. ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 3 Speed and bandwidth statistics related to service upgrade Average advertised vs. actual download speed Offered broadband connection by price and speed Source : OECD, TeleGeography, Point Topic Source : OECD 29 ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 4 2
3 Service bandwidth upgrade example I Service: Service: Normal : Service: Upgraded: Service: Service utilization is presented by the Contention Ratio ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 5 Service bandwidth upgrade example I Bandwidth per service ( Mbit/s ) <- Normal FTTH-BUS FTTH-RES 5 FTTH1 FTTH3 FTTH5 FTTH7 FTTH_2 FTTH_4 FTTH_6 FTTH_8 FTTH_1 FTTH_12 Bandwidth per service ( Mbit/s ) FTTH Home locations FTTH-BUS FTTH-RES Upgraded: FTTH1 FTTH3 FTTH5 FTTH7 FTTH_2 FTTH_4 FTTH_6 FTTH_8 FTTH_1 FTTH_12 ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 6 3
4 Service bandwidth upgrade - example I Service Areas and Sites Data connectivity FTTHBus FTTH-Res FTTH1 375 FTTH FTTH FTTH FTTH5 19 FTTH6 241 FTTH7 85 FTTH_1 15 FTTH_2 3 FTTH_3 2 FTTH_4 45 FTTH_5 6 FTTH_6 4 FTTH_7 2 FTTH_8 6 FTTH_9 3 FTTH_1 4 FTTH_11 6 FTTH_12 ITU-D Forum <- Normal Bandwidth per service ( Mbit/s ) Bandwidth increase : 1 % Service Areas and Sites Data connectivity FTTHBus Upgraded FTTH-Res Upgraded FTTH1 75 FTTH FTTH FTTH FTTH5 38 FTTH6 481 FTTH7 169 FTTH_1 3 FTTH_2 6 FTTH_3 4 FTTH_4 9 FTTH_5 12 FTTH_6 8 FTTH_7 4 FTTH_8 12 FTTH_9 6 FTTH_1 8 FTTH_11 12 FTTH_ Upgraded: Chisinau (Moldova), 4-6 May 21 Session 8_IS - 7 Service bandwidth upgrade - example I <- Normal (3 OLT, 17 Splitter 1:8, 89 Splitter 1:4) Access Network Dimensioning/ Optimization Upgraded: (3 OLT, 28 Splitter 1:8, 93 Splitter 1:4) ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 8 4
5 Service bandwidth upgrade example I Normal services : Costs : Acquisition Installation 1/1/ /1/ /1/ /1/ /1/ Maintenance Upgraded services : 1/1/28 1/1/29 1/1/21 1/1/211 1/1/212 Acquisition Installation Maintenance Difference : 1/1/28 1/1/29 1/1/21 1/1/211 1/1/212 Acquisition Installation Maintenance Costs increase : (relative to all costs) 1.16 % ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 9 Service bandwidth upgrade example I CAPEX Normal Upgraded 12 1 Costs : Difference Upgraded-Normal 8 OPEX 6 4 CAPEX OPEX Normal Upgraded ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 1 5
6 Service bandwidth upgrade example II Service: BUS Service: Normal Upgraded: Upgraded Service: RES Service: ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 11 Service bandwidth upgrade example II Average Bandw idth per Service (for 1/1/28) in Mbit/s CC_1 CC_2 CC_3 CC_4 CC_5 CC_6 CC_7 CC_8 CC_9 CC_1 Data connectivity Internet-bus Internet-res IPTV POTS POTS (ADSL) VoIP <- Normal Service Areas and Sites Average Bandwidth per Service (for 1/1/28) Data connectivity CC Copper Cabinets Upgraded: in Mbit/s CC_1 CC_2 CC_3 CC_4 CC_5 CC_6 CC_7 CC_8 CC_9 CC_1 Service Areas and Sites Data connectivity upgrade x 2 Internet-bus Internet-res ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 12 IPTV IPTV Upgrade x 2 POTS POTS (ADSL) VoIP 6
7 Service Areas and Sites CC_1 CC_2 CC_3 CC_4 CC_5 CC_6 CC_7 CC_8 CC_9 CC_1 Total : Service bandwidth upgrade - example II Data connectivity Internet-bus Internet-res IPTV POTS POTS (ADSL) VoIP <- Normal Bandwidth per service ( Mbit/s ) Upgraded: Service Areas and Sites Data connectivity upgrade x 2 Internet-bus Internet-res IPTV Upgrade x 2 POTS POTS (ADSL) VoIP CC_ CC_ CC_ Bandwidth increase : CC_4 CC_5 CC_6 CC_ % CC_8 CC_9 CC_ Total : ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 13 Service bandwidth upgrade - example II <- Normal (3 MSAN) Access Network Dimensioning/ Optimization Upgraded: (5 MSAN) ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
8 Service bandwidth upgrade example II Costs : Normal services : 1/1/28 1/1/29 1/1/21 1/1/211 1/1/212 Total: Acquisition Installation Maintenance Upgraded services : 1/1/28 1/1/29 1/1/21 1/1/211 1/1/212 Total: Acquisition Installation Maintenance Difference : 1/1/28 1/1/29 1/1/21 1/1/211 1/1/212 Total: Acquisition Installation Maintenance Costs increase : (relative to all costs) 1.85 % ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 15 Service bandwidth upgrade example II CAPEX 25 Costs : Normal Upgraded 5 Difference Upgraded-Normal OPEX Normal Upgraded CAPEX OPEX ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
9 Extension of the service bandwidth upgrade studies There is a need also to assess the cost for services in order to price products. Such study facilitates comparison of multiple service costing scenarios for strategic decisions on product pricing. Additional parameters are: price per service/bundle of services growth in customers from each service class growth in customers from each speed package The planner have to dimension the access network, to calculate all related costs and based on the expected revenue to providing insight into the Return-on-Investment and the profitability. ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 17 Problem 2 Selection of Access Technology Aim is to investigate the technoeconomical impact of various access technologies on the network for a given market Multiple techno-economical studies are carrier out for the purpose to determine the optimum access technology for the network Selection is done by comparison of the economical parameters for each access technology ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
10 Broadband access technologies Application of different broadband technologies IP Source : OESD 28 ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 19 Broadband access market share by technology Broadband subscriptions in Japan Broadband subscriptions in France Source : Japan MIC Source : ARCEP ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 2 1
11 Low subscriber base * Planning guidelines for broadband access technology Y Wireless N Is area Greenfield pocket within Brownfield? N Is there high growth for service demand? N Sample guidelines Y Y Is existing MSAN capacity & BB reach? * * Y N OLT exists or planned? N Y Temp BB wireless / Plan OLT FTTH Access Network Planning Roadmap Extend network from MSAN Access Network Planning Guidelines Source : STC ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 21 Example I urban area brownfield xdsl vs. FTTH brownfield xdsl ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
12 Example I urban area brownfield List of material : Node Name CO_Ubhur Splitter 1:32 _1 Splitter 1:32 _2 Splitter 1:32 _3 Node Description Part Number OLT Splitter 1:32 cost Splitter 1:32 cost Splitter 1:32 cost Description Total Number New Total Number Existing Total New Cost Date October 1,28 October 1,29 October 1,21 October 1,211 October 1,212 October 1,28 October 1,29 October 1,21 October 1,211 October 1,212 October 1,28 October 1,29 October 1,21 October 1,211 October 1,212 October 1,28 October 1,29 October 1,21 October 1,211 October 1,212 FTTH ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 23 Example I urban area brownfield xdsl vs. FTTH brownfield UC_1_9a UC_1_1-3 Net Present Value USD 1 5 UC_1_9a FTTH UC_1_1-3 xdsl 1/1/28 1/1/29 1/1/21 1/1/211 1/1/ ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
13 Example II urban area greenfield FTTH vs. WiMAX greenfield FTTH ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 25 Example II urban area greenfield WiMAX ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
14 Example II urban area greenfield FTTH vs. WiMAX greenfield UC_1_9c UC_1_9b Net Present Value USD 2 1 WiMAX UC_1_9c UC_1_9b FTTH 1/1/28 1/1/29 1/1/21 1/1/211 1/1/ ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 27 Example III (a) rural area xdsl vs. WiMAX rural area xdsl ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
15 Example III (a) rural area WiMAX ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 29 Example III (a) rural area Net Present Value Rural area -Tskneti-WiMAX-b-Year2; IRR=86.4%; Rural area -Tskneti-xDSL-Year2; IRR=% xdsl vs. WiMAX rural area in Euro Rural area -Tskneti-WiMAX-b-Year2 Rural area -Tskneti-xDSL-Year ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
16 Example III (b) rural area xdsl vs. WiMAX rural area xdsl ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 31 Example III (b) rural area WiMAX ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
17 Example III (b) rural area xdsl vs. WiMAX rural area ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS - 33 Improvement of the selection of access technology studies Present core network portion in the network expenses : as additional average cost per customer as total additional cost, related to the uppermost access network node Present additional costs related to running the business ( marketing of services, customer care, etc.) : as additional average cost per customer as total additional cost, related to the uppermost access network node ITU-D Forum Chisinau (Moldova), 4-6 May 21 Session 8_IS
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