Information bulletin Fixed Access Networks Technologies Review, 2011 2011, March J'son & Partners Consulting provides brief results of investigation of Russian and global markets of fixed access networks according to the outcomes of their development in 2011. To make common estimation of the market situation the data of such sources as interviews with the representatives of Companies-providers, data of foreign information sources, reporting and press releases of the Internet-providers, as well as own models of J'son & Partners Consulting were applied. General Characteristics of Broadband Access Market in According to the estimation of J'son & Partners Consulting by the end of 2011 39% of households (hereinafter HH) in Russia (21,7 million) had broadband Internet access, about 15% of which were connected by means of FTTH technology (PON architecture). The number of "home" broadband connections and penetration in Russia, 2011-2015. Source: J son & Partners Consulting Обзор технологий фиксированных сетей доступа, 2011 г.
Rating of Countries according to the Number of Private Broadband Access Connections According to the results of 2011 the leader in BBA subscribers is China with 155 million connected HH. The last in the rating of ten countries is Italy with about 16 million connections. For the last year Russia has reached the 7th place instead of the 6th thus anticipating UK for almost million subscribers. The top 10 countries by the number of broadband connections, 2010-2011. Source: Point Topic, ITU, J son & Partners Consulting The Main Technologies of Access Network J'son & Partners Consulting research pays attention mainly to three most widely spread technology groups: - FTTH (as a rule is used like a family of xpon technologies) - FTTB - ADSL and ADSL 2+ GPON PON technology is more adapted economically to the fitted carpet than to the point installations. GPON technology enables to provide the Internet access at the rate up to 50 Gb/sec and more. The length of the optical fiber may reach 20 km (over 90% US HH satisfy this demand). At the same time, there are development held with the aim to increase the length up to 60 km. The technology is based on perspective standard G.984.4, which is constantly improved for adding new services and interface in PON system.
FTTB Technology of the active optical networks FTTB is the main rival of passive FTTH both today and in the medium-term perspective. This technology satisfies customers requirements nowadays and is widely used both in Russia and abroad. FTTB technology together with FastEthernet provides with the optimal ratio in terms of quality, flow capacity and expenses for network building, and unlike PON technology is more profitable in case of point connections. ADSL 2+ According to the information provided by J son & Partners Consulting the prevailing technology of broadband access networks construction by the traditional providers is still ADSL 2+. The technology was developed to increase the possibilities of ADSL technology approves by ITU in 1999. At the moment the networks built on ADSL 2+ are presented in many countries, anyway, the technology is gradually becoming old and in the nearest future will be unable to satisfy the growing subscribers demands to the rate of data communication rate. The main advantages of the present technology is low cost of the network deployment, including the low cost of the users terminals (the average global cost - $40), as well as the possibility to install users terminals upon the consumers orders receipt. Penetration of Access Networks Technologies There is no broadband access technology in the world unambiguously recognized as the most efficient one. Traditional operators in many countries still use the copper access networks with the technology of asymmetric data communication of ASDL family. Among the optical access networks the preferences in different countries may by quite opposite. The largest penetration of FTTH technology was established in UAE 55, followed by Japan and Southern Korea 26% and 16%, respectively. Russia falls behind considerable in these values the penetration is about 0.5%. FTTH technology prevails in UAE, Norway, Slovenia, Latvia, Portugal, the Netherlands, Malaysia, Italy, Canada and Romania. FTTB technology prevails in South Korea, Hong Kong, Taiwan, Russia, Bulgaria, Estonia, China, Finland, Czech Republic, France, Ukraine and Turkey. In other countries the market is shared approximately fifty-fifty by FTTB and FTTH. The picture below provides with the rating of countries with the level of FTTH- and FTTB-technologies penetration over 1% with the number of connections over 200 thousand HH.
Countries with the highest penetration of FTTH / FTTB + LAN technologies, 2011 Source:Fibre-to-the-Home Council, ITU, J son & Partners Consulting There is no unique opinion in the world about the best standard of xpon family. In the USA there are at least three variants of passive optical networks. Europe and Japan are geared to unified, bit various architectures. The differences in the choice of PON architecture Region North America Japan Europe The used architecture BPON, EPON, GPON EPON GPON All Russian operators using passive optical access networks have opted for GPON (standard G.984.4).
Access Networks Equipment For the period from the beginning of 2008 till the end of 2011, according to the estimation of J'son & Partners Consulting about 78 million terminals of subscribers units (ONT/ONU) of all standards were produced. About 59 million of the total volume of produced 78 million ONT/ONU corresponds to the standard EPON/GEPON (IEEE 802.3ah). Operators of the South-Eastern Asia and, first of all, Chinese Internetproviders are the key customers of these units. About 18 million terminals more (i.e. less than one third of GEPON) corresponds to the standard GPON (ITU-T G.984.1-G.984.3). North American and European countries are the key customers of these units (approximately equally). ONT/ONU of the other standards (e.g. BPON) are produced in rather small quantities. Regional differences of FTTH architecture are defined with the historical background or the peculiarities of the area. So, in the North American continent PON-architecture is mainly used. It is connected with the fact that FTTH development in this region has started much earlier than in Europe and was reasoned with the development of cable television networks. GPON Development in the Russian Broadband Access Market Generally, xpon s Russian fixed broadband access market share as of the end of 2011 was extremely small: 1.5% of all broadband access connections. In the technological structure of the Russian market the share of FTTB and PON will be on average increased at 4% per year and by 2015 their share will be about 65% of all BBA-connections in Russia. Forecast of the number of broadband subscribers in Russia in the technological breakdown, HH million, 2011-2015. Source: J son & Partners Consulting
Rostelecom is the first Russian provider that has started construction and development of optical networks to the apartments of potential users based on GPON technology. The operator has connected about 300 thousand subscribers (about 3% of common amount) using this technology. In its medium-term and long-term perspective Rostelecom remains the key consumer of xpon technology. At least four macroregional branches have the plans of large-scale xpon access networks implementation (Center, North-West, Ural and Siberia). Three macroregional branches (Volga, South and Far East) still haven t published any definite plans concerning this technology. Development plans for the major networks xpon national operators Operators Development plans for xpon networks Rostelecom MTS VimpelCom Large-scale plans are available in four macro-regional offices. Three macro-regional branch of exploring the issue, or take a wait. Large-scale plans of the OJSC "MGTS" (details below). Operators in the group Vimpelcom, investigate the issue and took the fence Megaphone Operators in the group Vodafone, exploring the question or take a wait Transtelecom The operator has an uncertain position 1 MTT Launched a large-scale departmental project. Through 2009 the largest European phone operator MGTS was also known as the largest Russian Internet provider applying ADSL technology. In 2010 MGTS, OJSC, has initiated the development of a network applying passive fiber-optical technologies, and in May, 2011 its construction has begun. Considerable influence on Internet users number increase has performed active implementation of fiber-optical technology GPON in new buildings and subscribers switch to the individual lines. The company is planning to perform 100% glassing of Moscow HH. The operator states that the subscribers ONT will be provided free of charge, anyway the provider doesn t present the information of investment sources for this action. In April 2011 there was announced a contest for supply of ONU terminals for this projects. Only six vendors are allowed to participate in the contest. The declared volume of supply is extremely great 4.4 million units, i.e. one for each HH in Moscow. In 2012 the Company plans to continue extending the range of telecommunication services based on GPON and will distinguish a range of tariff plans with the great choice of rates. 1 Extract from the interview of TTK top-manager: We use FTTB technology as the main power, but at the same time we are examining also FTTH, we have also created several trial areas. This technology has several types, in particular, GPON, we consider all of them. Anyway, FTTB satisfies subscribers needs for many future years, I believe, 10-20 Mbit/sec for a household is a high rate.
Contents of Complete Version of the Report with the Results of the Research Review of Fixed Access Networks Technologies, 2011 2 1. Introduction 2. Technologies Classification and Systematization 3. Technological Review 4. General Characteristics of BBA market in Russia 4.1. Market Volume and Dynamics 4.2. Market Structure according to Access Categories 4.3. Broadband Access Providers 4.3.1. Leading Providers 4.3.2. Dynamics of Number of Leading Providers Number 4.3.3. Comparison of Social and Demographical Profiles of the Leading Providers 5. Comparative analysis of Internet Access Technologies (FTTx, ADSL, DOCSIS) according to Federal Districts 5.1. Average Month Expenses of BBA Users 5.2. Average Speed of Internet Access 5.3. Average Volume of Consumed Traffic 5.4. Global Market of Internet Access Networks 6. Manufacturers of Access Networks Equipment 7. Analysis of Concurrent Advantages of Russian Providers 8. SWOT-Analysis of the Most Perspective Technologies (GPON, FTTB, ADSL 2+) 9. Marketing Analysis of Fixed Access Networks Technologies 9.1 Global Market 9.1.1. Profiles of Fixed Access Networks Participants 9.1.2. Global Operators Access Networks 9.1.3. Manufacturers of xpon Different Standards of Equipment in the World 9.1.4. Manufacturers Market Shares in the Global Production of ONT/ONU 9.2. Russian Market 9.2.1. Largest Operators Plans of xpon Networks Development Plans 10. Social-Economic State Politics In the Area of Telecommunications and Informatics, Regulator s Position 11. Fixed Access Networks Development Up to 2015. 12. Conclusion 2 J son & Partners Consulting preserves the right to review, to clarify and to adjust reported estimations based on new data that may be obtained in terms of constantly performed monitoring of fixed access networks monitoring.
FOR MORE INFORMATION REFER TO: Pavel Ermolich Commercial director Pavel@json.ru www.json.ru The informational ballot is written by the company J'son & Partners Consulting. We make our best to provide you with factual and prognostic data which reflect the whole situation and are available at the moment of publication. J'son & Partners Consulting reserves the right to revise the data after the appearance of new official information about individual players. Copyright 2012, J'son & Partners Consulting. Copying or distributing in print or electronic forms without written permission of the company J'son & Partners is prohibited. Press may use any graphics, data and forecasts, contained in this market review, only with reference to a source of information - J'son & Partners Consulting. J'son & Partners [registered trademark].