Fiber to the home market in gear

It's a bit of a chicken-and-egg thing. We won't see strong demand for residential broadband access until there are applications people want to use it for. But applications won't be created and sought after until enough people are willing to subscribe. One way to break the cycle is to offer ultrafast and reliable Internet connections, multiple phone lines with enhanced features, video, telemedicine and education services, all for a reasonable price.

Vaulting over traditional broadband technologies, fiber-optic technology delivers Internet, voice and video at lightning-fast speeds - from 2M to 100M bit/sec and beyond. On a fiber-optic network, data is transmitted as light impulses along thin strands of silica glass. Unlike copper cabling, optical fiber is not subject to electromagnetic interference because it uses light, not electricity. Moreover, fiber optics can transmit data over much longer distances; 6.2 to 49.6 miles over single-mode fiber-optic cabling vs. a few thousand feet for copper cabling.

Fiber-optic technology has been around since 1970 when Corning invented the optic cable. Most telephone companies' networks are fiber-based. A handful of upscale residential developments, mainly in Texas, Arizona and California, have even enjoyed ultrahigh-speed data, video and voice applications via PCs and TVs for a number of years. Built from the ground up with fiber cabling or a mix of fiber and coaxial cables, such "connected home communities" also provide a host of nondigital amenities such as parks, playgrounds, golf courses and restaurants.

Betting on the future

Since the advent of fiber to the home (FTTH) technology, the question has been how to bring it to existing communities. Who's going to pay for it? Does the expense justify the benefit? Will residents subscribe? A handful of municipal governments are finding out first-hand as they embark on ambitious fiber-optic projects. Many of the areas that see the most benefit are remote, are ill-served by incumbent cable and telephone providers, and have trouble attracting employers. FTTH projects are cropping up in Colorado, Utah and Washington state.

A new report by Render Vanderslice & Associates, "Fiber to the home and optical broadband, 2002," predicts substantial market growth in the coming years. Even today, the number of households with access to FTTH technology has almost quadrupled since last year, from 19,400 to 72,000 homes nationwide, and the numbers will keep scaling upward until they reach between 800,000 and 1.4 million homes by September 2004.