The Economics of Broadband Access Platform Evolution The EU's ACTS (Advanced Communications Technologies and Services) research programme has tested a number of approaches to delivering broadband services to the customer. All are technically capable of doing the job but the challenge for network operators is to find an evolution strategy that delivers enough income to justify the cost of upgrading the network. A group of ACTS projects has recently produced a guideline 'Economic Issues of Broadband Access Platform Evolution. This examines the techno-economics of the access network architectures developed by the projects: BroadbandLoop testing a Hybrid Fibre-Copper infrastructure using a Passive Optical Network Very high rate Digital Subscriber Line technology. TOBASCO - upgrading CATV networks using High-Density Wavelength Division Multiplexing PLANET, developing a full-service optical access network using Passive Optical Networks with a high splitting factor (up to 2000) and a range of up to 00 km. The guideline describes the system designs tested in field trials by three projects and then presents the results of techno-economic studies aimed at determining when each approach makes economic sense for a network operator. The results of these studies are brought together in some general conclusions on the economic aspects of broadband access platform evolution. BroadbandLoop Single Business customer Office ONU 2Mbit/s Voice/ datamux POTS ISDN ONU Multiple Residential/ Small Business customers (Reuse of existing copper in customer drop) SDH Ring (STM- or STM-4) ONU with multiple VDSL cards NT Passive Splitter SIM n x VDSL OLT 55Mbit/s ODN Multiple Residential/ Small Business customers (new network) n x 5Mbit/s n x 5Mbit/s ONU with E, POTS, ATM25, Ethernet cards SIM Figure : BBL system concept Legend: OLT: Optical Line Terminal ONU:Optical Network Unit SIM: Subscriber Interface Module NT: Network Termination ODN: Optical Distribution Network Page
BroadbandLoop is developing and testing technologies which will be ready for mass deployment within the next three years. It combines a Passive Optical Network (PON) with Very high rate Digital Subscriber Line (VDSL) technology. The PON provides low cost fibre access, while VDSL provides high-speed transmission to the customer over a final short length of unshielded twisted pair or coax. Figure shows the BBL network topology. It uses a single fibre PON architecture with a splitting ratio of up to 6. In the basic version the PON has a capacity of 55Mbit/s in both directions. This can be gracefully extended to provide Gbit/s downstream and 576Mbit/s upstream. Some typical values for the BroadbandLoop system are: Number of customers: Up to 890 POTS connections based on use of the V5. exchange interface. Up to 52 broadband connections. There is an optical split of :6. A broadband ONU has a capacity of 32 broadband connections. Distances (maximum): 6 km Capacity: The PON has a basic capacity of 55Mbit/s in both directions. It can be upgraded to provide an additional 6 x 5 Mbit/s down stream and 6 x 25 Mbit/s in the upstream. The VDSL options are (5Mbit/s,.6 Mbit/s) and (2Mbit/s, 2Mbit/s) Services: POTS, ISDN, Video Conferencing, fast Internet, tele-learning, home-working Interfaces: POTS, ISDN, N x E0, E, ATM25, Ethernet TOBASCO TOBASCO looks at upgrading existing CATV networks by using High-Density Wavelength Division Multiplexing (HDWDM) to provide broadband interactive services The system design is presented in Fig. 2. The basic system consists of a bi-directional passband coaxial network connected to a bi-directional baseband APON system. The system is based on a typical CATV network architecture, consisting of a Headend (HE), a fibre network with two splitters and two optical amplifiers, an Optical Network Unit (ONU) and a coaxial distribution network. At the customer s home premises, a Home Interface Unit (HIU), in other words a Cable Modem, is added to cope with the Interactive Services (IS). The capacity can be progressively increased by using High Density Wavelength Division Multiplexing (HDWDM). Up to eight wavelengths can be used in both the upstream and downstream directions. BB IS CATV DS Network Mgt. & Control IS exchange CATV HE multi-λ TRX analog Tx λ..λ 8 @ 622 Mbit/s ATM WDM bidir. OA 4 λ..λ 8 λ..λ 8 6 WDM λ-switched TRX Network Mgt. & Control λ control analog Rx IWU HIU coax Headend Local Splitting Centre Optical Network Unit Figure 2: Technical Layout of the TOBASCO system. Some typical numbers for the fully fledged version are: Number of customers: 2500 per system. There is an optical split of :64 (with bi-directional amplifiers) and about 25-40 customers per ONU Page 2
Distances (maximum): 25 km for the feeder, 5 km for the distributive part Capacity: optical 4x622 Mbit/s up- and downstream, coaxial 8 Mbit/s upstream and 32 Mbit/s downstream per ONU (shared by 25-40 customers) Services: CATV, Digital Video Broadcast, Video Conferencing, fast Internet, tele-learning, home-working PLANET PLANET aims to develop a cost-effective full-service optical access network for the year 2000, using a PON with a high splitting factor (up to 2000) and range of up to 00 km). Figure 3 shows the generic architecture of the PLANET SuperPON system. The target optical split is 2048 and the range up to 00 Km. The SuperPON consists of an Access Node (AN), which is connected to an amplified splitter through a feeder up to 90 km long. Erbium Doped Fibre Amplifiers (EDFAs) are used half way along the feeder to boost the 550nm downstream signal and InP-based SOAs to boost the 300nm upstream signal. The distribution section is up to 0km long and the ONU can be located in either a curb cabinet (FTTC) or at the customer site (FTTH). Time Division Multiplexing (TDM) is used for the downstream signal and Time Division Multiple Access (TDMA) is used to share the upstream capacity among the users. 3.3.3. Some typical numbers 2.5 Gbit/s 3 Mbit/s : N feeder repeater splitter repeater ONU AN <45km <45km : M < 0km total splitting of 2048 Figure 3: Schematic view of the PLANET SuperPON system. AN: access node, AS: amplified splitter, ONU: optical network unit. Some typical values for the PLANET system are: Number of customers: up to 5000 per system (FTTC). The optical splitting factor can be as large as 2048 giving 7 users per ONU. A maximum of 2048 subscribers can be served in a pure FTTH scenario. Distances (maximum): 90 km for the feeder, 0 km for the distributive part Capacity: optical 2.5 Gbit/sec downstream and 3 Mbit/sec upstream Services: digital video broadcast, video conferencing, fast Internet, tele-learning, homeworking. Techno-Economic Results Techno-economic studies have been made of each of the three systems to determine how and where network operators can use them most effectively. The studies use an approach developed in the RACE project TITAN and refined by the ACTS project OPTIMUM. BroadbandLoop studied the relative Installed First Costs (IFC) costs of: Different access technologies (ADSL, FTTC/VDSL and FTTH) for providing broadband services to residential customers in an area with high availability of good quality copper. Page 3
A fibre rich strategy -Fibre To the Office (FTTO)- versus a fibre lean strategy -Fibre To the Curb (FTTC)- for providing broadband services to small business customers in Western Europe. A fibre rich strategy - (FTTO) or Fibre To the Building (FTTB)- versus a fibre lean strategy (FTTC) for providing broadband services to small business customers in the centre of a town in Poland. For residential customers, ADSL has the lowest up front costs and hence the lowest risk over a ten year installation period. However if demand is expected to grow rapidly, VDSL and FTTC are only slightly more expensive. For business customers in Western Europe, a fibre rich strategy (FTTO or FTTB) is the best option The reason is that there is a high churn factor and new ducts and cables need to be installed for new customers. Direct fibre connections avoid the costs of street cabinets and powering. For business customers in a small town in Poland, a fibre rich strategy is also the best option. This time the reason is that the quality of the existing copper cables is not good enough to support xdsl. Street cabinets and powering are a major part of the up-front costs. TOBASCO investigated Installed First Costs of: The fully fledged TOBASCO system, A Space Division Multiplexing approach Alternative migration paths, The probable trends in component costs. The fully fledged TOBASCO system uses many new and expensive components especially in the ONU. Increasing the number of homes served per ONU significantly reduces the cost per customer. A high proportion of the costs of the fully fledged system are fixed costs and high penetration rates are neded to make the system affordable. Component costs will fall significantly over the next 0 years as the components go into mass production. The system is higly scaleable. It can start with each ONU serving up to 2,500 customers and migrate in stages to 40 customers per ONU as demand grows. This keeps the investment per customer in line with revenues. At high penetration rates the technical advantages of the TOBASCO system justify the small extra cost compared to other high capacity systems such as Space Division Multiplexing. PLANET considered both Installed First Cost (IFC) and Operation and Maintenance (O&M) costs. Several SuperPON architectures were compared with an APON architecture combined with SDH feeder, for FTTC (8 users per ONU) as well as for FTTH. It also considered the implications of probable trends in component costs. FTTH is always more expensive than FTTC because of the cost of installing the optical cable to the home. FTTC costs are expected to fall by 25% between 2000 and 200. Components and cables will respectively cost around 55% and 50% less but the cost of civil works will be unchanged. At low penetration levels (<50%), the SuperPON architectures are more attractive than APON because of the less expensive amplified splitter. O&M costs for FTTH are lower than for FTTC. This is largely due to the costs of the FTTC street based ONU Page 4
O&M costs for SuperPON systems are lower than for APON systems. This is because the street based equipment is less complex and more compact. Conclusions The guideline presented detailed results from each of the case studies and then brought these together in some general conclusions.. Integration of optical components like low cost transceivers at the ONU, optical amplifiers, or HDWDM components will enable higher bandwidths using the TOBASCO and/or PLANET approach for comparable IFC. 2. The fixed part of the IFC of advanced optical access networks like PLANET and TOBASCO is high. 3. The economic feasibility of advanced optical access systems depends on how component prices evolve. 4. The availability and quality of existing cable infrastructure are important factors in the choice of the architecture. 5. Cost of Ownership can be more important than Installed First Costs when comparing architectures 6. FTTH architectures have potentially lower Cost of Ownership than FTTC architectures. Further information about the ACTS programme can be found at: http://www.actsline.org and full texts of the ACTS guidelines can be downloaded from: http://www.infowin.org Hill Stewart ACTSLINE project manager. Page 5