The tea leaves of broadband seem to be a bit conflicted these days. One week, an analyst report declares that cable is faced with a "looming bandwidth crisis," while yet another forecasts that HFC still has plenty of pop in store for years to come.
Despite having myriad "levers" available to expand or squeeze more out of the bandwidth they already have (i.e. node splits, switched broadcast, spectrum overlays, advanced codecs), will cable operators eventually have to push fiber all the way to the home just to stay ahead of demand for growing HDTV lineups and higher and higher Internet speeds, as well as competition from expanding pockets of FTTP (fiber-to-the-premises) deployments?
While that question has been debated in recent years within industry circles, it quickly rose to the mainstream surface in August when a report from CableLabs called "Cable's Response Alternatives to FTTP" was leaked, and then turned into a front-page story in the Wall Street Journal. At a base level, that analysis from CableLabs, dated July 31, 2006, and obtained recently by CED, allows that the HFC network "is well poised" to handle coming capacity requirements of HDTV and VOD services through 2010, with only "modest changes" in networks with nodes serving 500 homes passed and 750 MHz of spectrum. However, the report does outline a scenario in which it might make economic sense for cable operators to consider running fiber all the way to the home (for more, see "Report," p. 26).Greenfield opportunities
While the CableLabs report notes that FTTP (fiber-to-the-premises) could be a potential fit if a galaxy-full of stars align a certain way, some operators are already exploring opportunities in greenfield situations. In fact, some home builders are practically insisting upon it, believing that new homes are easier to move, and that they can sell at higher prices, if they have a strand of glass connected to them.
Even Qwest, considered one of the more conservative telcos of the bunch, agreed to install an FTTP network for a master-planned community nestled in the hoity-toity town of Lone Tree, Colo.
Alloptic’s Micronode handles
the optical-to-electrical conversion,
which allows operators to use their
typical set-tops and modems.
BendBroadband, for example, is testing the FTTP waters in a new residential housing development. But rather than enlisting a full PON system, the Oregon-based operator is installing FTTP only at the physical layer. And, instead of employing an expensive ONU, BendBroadband is deploying a less costly home-side product–in this case, something from Alloptic called a "Micronode"–that terminates signals at the home and converts the incoming optical signals back to electrical form. One key benefit of this strategy? It will allow BendBroadband to use its regular lineup of set-tops, cable modems and multimedia terminal adapters and keep its headend and backend status quo.
"In the home, [the services] perform the same as they do with HFC," says Amy Tykeson, CEO of the Oregon-based operator, noting that this approach costs about 12 to 15 percent more to deploy than traditional HFC, but does allow the company to save some maintenance dollars because the architecture is passive.
"For us, it's making some sense," she says.
It also gives BendBroadband some "breathing room" if it decided later to incrementally upgrade to a GPON or an EPON, adds Frank Miller, the operator's chief technology officer and vice president of engineering.
Even if the benefits of FTTP are part perception, the reality is that
new homes connected to fiber do carry a premium. Some MSOs
are offering FTTP strategies to ensure that they have a spot at
the negotiation table when home builders come calling.
But more opportunities for FTTP should arise, considering that central Oregon is one of the fastest growing counties in the state and, therefore, a breeding ground for additional opportunities for new builds and new customers.
Because it does not use a pricey ONU, the cost of this approach is about 50 percent less than a BPON system, according to Alloptic President & CEO Ric Johnsen. He says three Tier-1 cable operators are testing Alloptic's technology today, and a Tier-2 MSO on the east coast is already conducting a field trial, with expectations that it will become a full-blown deployment by year-end. Two additional Tier-2 operators could have the Micronode strategy deployed by the end of 2006, as well, he says.
But BendBroadband is far from alone. Cable One Inc., at the behest of a builder, is building an FTTP system that will serve a 6,800-home development in Rio Rancho, N.M.
In this case, the operator is deploying Wave7 Optics' Last Mile Link platform, which can pass through traditional cable RF video signals. Voice and data, meanwhile, are piped on an active Ethernet system.
But there is more FTTP business from cable on the horizon, and Wave7 has seen "significant interest among cable operators," says Wave7 CTO Jim Farmer, who expects to see more trials, and possibly some deployments, with MSOs over the next 12 months.
He agrees, however, that HFC remains a viable option in legacy markets, and that HFC has much more to offer than twisted pair implementations.
"I don't think cable needs to rip out good HFC yet," Farmer says.Feeding the fiber demand
Other vendors are also positioning themselves to help cable operators with new builds that require fiber all the way to the home. Aurora Networks, for example, markets a "Fiber On Demand" architecture that, as the name implies, gives cable operators the ability to install fiber to homes only where it is needed, rather than having to deploy it system wide.
In addition to aiding cable's deeper and deeper push of fiber, this flexibility could come in handy for operators that are crossing swords with Verizon in the telco's FiOS areas, according to Luis Yu, Aurora's senior product manager.
Rather than PON, this approach, which leverages Aurora's digital return technology, would overlay a fiber capable of transporting in the neighborhood of 100 Mbps to homes already connected to the HFC network. At the home, the operator would install an inexpensive media converter. The system costs about $500 to $600 per link, when the CPE and active components on the network are factored in. The unit price for standard media converters is already under $200, but there's no reason why the price can't eventually be pushed to the $100 level, says John Dahlquist, Aurora's vice president of marketing.
"Once you've trenched fiber to the home, the cost of the fiber is less than coax," Yu says. "You are pretty much plumbed for fiber-to-the-home." The operator could then continue to use the media converter or, further down the road, convert it over to a PON-based system.
This flexibility could also help operators get the jump on telcos, and offer FTTH-based services while the competition is pulling and installing their own fiber networks, Dahlquist explains.
But who's using this? Yu says most of the interest today is in Mexico and in Japan with operators such as J:COM, which serves high-density areas and can plop down a 100 Mbps service to an MDU and split off the signal. Additionally, the Fiber On Demand approach offers a dedicated speed, giving it a leg-up on the best-effort 100 Mbps service offered in Japan by Yahoo.
In the U.S., some operators are looking at Aurora's Fiber On Demand system for commercial services targeted to medium-sized businesses.
Yet another FTTP vendor project still off the public radar involves CommScope and Aurora Networks. Those familiar with it and who have seen it at recent trade shows say it's an FTTP architecture that can feed off of HFC systems that are in close proximity to new builds. As it's explained, a fiber would be run to the new area to a node that serves 256 homes. A special NIU would then convert the optical signal to electrical as it enters the house. In a method similar to that of Alloptic's, this would allow the operator to use their existing set-tops, and DOCSIS modems, as well as their installed base of CMTSs and other headend equipment.
This approach aims to compete on cost with new HFC builds, though specific figures have not yet been made available. The companies involved declined to comment on the project, but sources familiar with the initiative say this architecture could serve up to 256 homes per node, but could be configured to support 128 HP.
"The beauty of this architecture, from an operator's standpoint, is that nothing changes in the headend to serve this new area. The only thing that changes is the installation of fiber at the home and the NIU on the side of the home," notes one person familiar with the project. It's being billed as "a very clean and seamless way to transition [to FTTP], and to also include a new developing area with fiber-to-the-home. It allows [operators] to get into those types of areas without changing the base technology."
Some major operators are already discussing trials of this new system, but none that were contacted about those plans were willing to comment.Cox studies show that HFC remains the best answer
While there have been some cases when a traditional cable operator decides to employ FTTP in greenfields, Cox Communications created a taskforce that concluded that HFC is, and will continue to be, the best architecture to support the existing and future service and customer demands.
That group took on the challenge last year following Hurricane Katrina's destructive ravaging of New Orleans. Nothing was considered sacred. Proposals could run the gamut–everything from PON-based FTTP schemes, to deep fiber HFC.
"The rules of engagement were that we could propose any architecture we thought was right for that market," explains Dan Estes, Cox's director of network architecture.
What the group came up with was termed the Extensible Optical Network (EON), which uses CWDM wavelengths for bandwidth expansion in tandem with a "collector node."
That strategy, Estes says, will enable Cox to not only boost capacity as it is required, but also migrate toward a completely passive network devoid of amplifiers. But that is "step four or five in the migration plan," Estes says. Steps beyond that could include a conversion to DWDM, as Cox seeks out ways to increase bandwidth economically for services down the road.
Today, Cox's new builds are comprised of the node-plus-three amplifiers in the cascade (N+3), with about 500 homes served off the node. That approach, Estes says, positions the plant for future node splits and driving fiber toward the next amplifier in the cascade.
In terms of spectrum, Cox uniquely proposed the use of 3 GHz passives from Vyyo Inc. in portions of plant that had to be completely replaced, and could be leveraged for high-octane business services as well as powerful residential services. Cox is employing 1 GHz passives from vendors such as Scientific Atlanta and activating spectrum up to 860 MHz in all other new build situations, or in cases in New Orleans where plant needed a less expensive restoration.
This strategy "defers the need to do fiber all the way to the home," Estes says.
Some other operators who spoke on background note that they are moving to N+2, and are prepared to do N+1.
"But one thing I don't rule out is taking 750 MHz plant and upgrading to 1 GHz," or taking existing 550 MHz and upgrading to 1 GHz using the same spacing, says an engineer with a top operator speaking on background. Additionally, "The good news about [the 3 GHz overlay] is that it is compatible with DOCSIS modems and the drops and the coax. It may be a great way to implement DOCSIS 3.0... and get a bunch of pristine bandwidth together."
Cox, like other MSOs, has been weighing proposals from home developers that are starting with clean slates. Rather than offering an FTTP solution, Cox is communicating that the HFC network "has a lot of legs left" for any service that those customers would want or need.
"We think [HFC] is the economic choice today for the vast majority of our customers, and that it meets their needs for a long time to come," Estes says. "HFC serves us well, and positions us for what the customer needs today, and positions us extremely well for what customer demand may materialize in the future."
One issue with PONs, Estes notes, is their inflexibility with the relatively expensive optical interface unit attached to the customer home. Customers who only wanted voice services, for example, would require the same costly interface as customers who wanted the whole triple-play, so there is a big question about the return on investment.
However, as mentioned earlier, a growing number of vendors have developed or are developing cheaper FTTP systems optimized in ways that allow cable operators to use their existing headends and their usual base of set-tops, modems and other customer premises devices.