FTTP moving up the to-do list for 2004

Regional Bell operating companies say they will begin deploying fiber-to-the-premises technology next year, a rather speedy time frame considering that the proposal for FTTP equipment was issued only six months ago.

Of the three RBOCs that jointly issued the proposal, Verizon is the most bullish and aggressive on FTTP. Verizon already has named its equipment suppliers - Advanced Fibre Communications is the chief vendor - and disclosed plans to pass 1 million homes in 2004, perhaps doubling that coverage in 2005.

SBC, on the other hand, is the most conservative on its FTTP implementation.

"There is no requirement for FTTP to gain share" in access lines, said SBC CFO Randall Stephenson at a recent investment conference. "Right now, it's not on our front burner. There's no sense urgency to take FTTP for a compelling product offering."

To continue reading, register here to become an Insider. You'll get free access to premium content from CIO, Computerworld, CSO, InfoWorld, and Network World. See more Insider content or sign in.

Regional Bell operating companies say they will begin deploying fiber-to-the-premises technology next year, a rather speedy time frame considering that the proposal for FTTP equipment was issued only six months ago.

Of the three RBOCs that jointly issued the proposal, Verizon is the most bullish and aggressive on FTTP. Verizon already has named its equipment suppliers - Advanced Fibre Communications is the chief vendor - and disclosed plans to pass 1 million homes in 2004, perhaps doubling that coverage in 2005.

SBC, on the other hand, is the most conservative on its FTTP implementation.

"There is no requirement for FTTP to gain share" in access lines, said SBC CFO Randall Stephenson at a recent investment conference. "Right now, it's not on our front burner. There's no sense urgency to take FTTP for a compelling product offering."

BellSouth is the third RBOC proposing FTTP.

FTTP defines a set of common technical requirements for extending fiber-optic cabling and equipment to homes and businesses. The industry standard-compliant specifications will grease the skids for deployment of next-generation broadband networks that deliver high-bandwidth Internet, voice and video services and applications to corporations and residences.

Approximately 10% of businesses in the U.S. have fiber access to the service provider network, industry executives have said.

RBOCs hope the investment they make in running fiber to homes and businesses will generate more revenue for them by way of enticing new services and higher-speed transport for their customers.

They also hope it will stem the loss of customers and access line revenue to alternative service providers such as cable companies.

But FTTP is rife with deployment challenges. The main one is in the fiber run and how much that fiber run will cost.

RBOCs have a choice of overbuilding their existing copper cabling plant with fiber, or limiting fiber runs to new homes and business structures. RBOCs also have to consider how to run the fiber - aerially or underground - and how much those rights-of-way will cost.

Generally, it costs more to trench fiber underground than it does to string it along the wires that run from telephone pole to telephone pole. It also costs more to overbuild an existing copper infrastructure vs. running fiber where there are no existing facilities, such as new homes or buildings.

To date, only Verizon has said it will undertake an overbuild project, while BellSouth and SBC are for the most part holding back.

Current estimates list buildout costs at $600 to $1,000 per home. The cost of the build undoubtedly will be factored into the cost of service to the subscriber.

And if subscribers aren't willing to pay the asking price for the service, the hole dug for the fiber quickly becomes a money pit.

"It seems that before FTTP becomes the growth engine we all hope for, there is pain in the form of lots of development expense before large-scale deployments begin perhaps in late 2004 or in 2005," says analyst Anton Wahl of Needham and Co.