Product Type: Market Research Report
Published by: The Diffusion Group (TDG Research)
Published: March 2006
Product Code: R662-28Description This report is the first in TDG's year long series examining the Global Fiber to the Home (FTTH) markets. The decision to deploy FTTH in any market will be determined by the business case. More precisely, it is the service provider business case which defines if, when, and how much FTTH is deployed. Gone are the days of massive investment in new technologies based on vendor promises or technology visions. The telecommunications market is today much closer to the economists’ view of a perfect marketplace in that FTTH is being subjected to the acid test of an unrelenting business case analysis.
But if it is a question of business case, why is FTTH being deployed so much faster in parts of Asia than the rest of the world? Simply stated, the business case is better - much better - in Asia.
This first report examines the core business case of fiber to the Asian market including China, Japan, South Korea, and India. Additional discussions of the growth of the markets in Taiwan and Australia are included.
Covered in this report are the service market fundamentals, examination of OPEX and CAPEX expenses, comparisons of other broadband technologies, as well as forecasts through 2010.
Please Note: Online delivery of this product is only available as a Global Site License (Access to report for any number of people internal to your organization via your local network or intranet sites, including access to report and supplemental features.)
Table of Contents - Key Findings
- 1.0 Introduction
- 1.1 Report Methodology
- 1.2 The Business Case Defines the Opportunity
- 2.0 Definitions
- 3.0 FTTH Network Overview
- 3.1 PON Overview
- 3.2 PON Network Components
- 3.2.1 Optical Line Termination (OLT)
- 3.2.2 Passive Optical Splitter (POS)
- 3.2.3 Optical Network Termination (ONT)
- 3.3 PON Standards
- 3.3.1 Broadband PON
- 3.3.2 Ethernet PON
- 3.3.3 Gigabit PON
- 3.3.4 PON Standards Compared
- 3.3.5 Regional Variations in Fiber Preferences
- 3.3.6 Future PON Standards
- 3.3.7 Video and RF Overlay
- 4.0 Global Demand for Broadband
- 4.1 Global Demand
- 4.2 Deployment by Technology
- 4.2.1 Subscribers by Global Region
- 5.0 Market Drivers and Inhibitors for FTTH
- 5.1 Global Market Drivers for FTTH
- 5.1.1 Users Continue to Demand Higher Internet Access Speeds
- 5.1.2 Network Operating Cost Reductions for Telecom operators
- 5.1.3 Falling Equipment Prices for PON Solutions
- 5.2 Additional Market Drivers Unique to Asia
- 5.2.1 Dominance of Multiple Dwelling Units (MDUs)
- 5.2.2 Lower CAPEX per Sub
- 5.3 Global Market Inhibitors
- 5.3.1 Increased CAPEX
- 5.3.2 Uncertain Service Uptake
- 5.3.3 Lack of Plug-and-Play Solutions
- 5.4 Market Inhibitors Specific to the Asian Market
- 5.4.1 Low ARPU in Emerging Asian Markets
- 6.0 Asian Demographics and Socio-Economic Conditions
- 6.1 Asian Countries Shaping the Future of Telecom
- 6.1.1 China
- 6.1.2 India
- 6.1.3 Japan
- 6.1.4 South Korea
- 6.2 High Technology is the Great Equalizer for Emerging Markets
- 6.3 Asia Markets by Development Stage
- 7.0 Operator Deployment of FTTH in Asia
- 7.1 Current FTTH Subscribers in Asia
- 7.2 Japan Leads the Way
- 7.2.1 Highly Competitive FTTH Market
- 7.2.2 Attractive Pricing is Driving Growth
- 7.2.3 Favorable Regulatory Conditions
- 7.2.4 Do It Yourself (DIY) Installation
- 7.3 South Korea Plans its Next FTTH Move
- 7.4 China is a Sleeping Giant
- 7.4.1 Government Promotions
- 7.4.2 The Role of 3G and WiMAX in China
- 7.4.3 Impetus for Out-of-Region Growth Could Drive FTTH
- 7.4.4 FTTH Trials Underway in China
- 7.4.5 Chinese Urban Professionals Will Spur FTTH Deployments
- 7.5 India: Think Long Term
- 7.5.1 Limited Supply But High Demand
- 7.5.2 Broadband Operators
- 7.5.3 FTTH: No Time Soon
- 7.5.4 Mobile Wireless: The Real Giant in India
- 7.6 Other Developed Asian Markets
- 7.6.1 Taiwan: Planning Its Next Step
- 7.6.2 Australia: Catching Up After a Slow Start
- 8.0 FTTH Vendors & the Asian Market
- 8.1 Japanese Vendors
- 8.2 Korean Vendors
- 8.3 China’s “Optical Valley”
- 8.4 Start-Up Vendors Finding a Home in Asia
- 9.0 Services - The Critical Demand Driver
- 9.1 The Importance of Headroom
- 9.2 Emergence of New Services
- 9.2.1 IPTV 64
- 9.2.2 Online Gaming
- 9.2.3 Online Karaoke
- 9.2.4 Music and Movie Downloading
- 9.2.5 Video Phone
- 10.0 Forecasts for Asian FTTH Subscribers
- 10.1 Regional Scope
- 10.2 Suburban and Urban Markets Rule
- 10.3 Broadband Subscriber Forecast for Asia
- 10.4 FTTH Subscriber Forecast for Asia
- 10.4.1 Emerging Versus Developed Markets
- 10.4.2 Developed Market Forecasts
- 10.4.3 Emerging Market Forecasts
- 11.0 Business Case
- 11.1 The Bottom Line
- 11.2 Baseline Assumptions and Results
- 11.3 Winners and Losers
- 11.4 Japan - Head Start with Lower CAPEX
- 11.5 High CAPEX but Large Operational Cost Savings
- 11.6 Emerging Markets
- 11.7 Key Conclusions
- 11.7.1 Revenue is King
- 11.7.2 Cheap Labor has its "Price"
- 11.7.3 Incumbents Have the Most to Gain (or Lose)
- 11.7.4 The Tipping Point
- List of Figures
- Figure 1 PON Access Networks
- Figure 2 Residential Broadband Subscribers Worldwide: 2001 - 2009
- Figure 3 Broadband Deployment by Technology - 2005
- Figure 4 Broadband Access by Region - 2005
- Figure 5 Broadband Subscribers in Asia: 2002 - 2010
- Figure 6 FTTH Subscribers in Asia: 2002 - 2005
- Figure 7 Net Additions of Japanese FTTH and ADSL subscribers per month
- Figure 8 FTTH Market Share in Japan - 2005
- Figure 9 Broadband Subscriber Growth 2002 to 2006 - US and China
- Figure 10 Broadband Subscribers for Asia - All Technologies
- Figure 11 Asian FTTH HH Subscribers: 2003 - 2010
- Figure 12 FFTH Subscribers by Developed and Emerging Markets
- Figure 13 FTTH Subscribers in Developed Markets only
- Figure 14 FTTH Subscribers in Emerging Markets only
- Figure 15 FTTH Baseline Business Case
- Figure 16 FTTH New Entrant Business Case
- Figure 17 FTTH Emerging Market Scenario
- Figure 18 Payback Sensitivity to Labor Rates and Disposable Income
- List of Tables
- Table 1 - FTTH Business Case Structure
- Table 2 - PON Standards Compared
- Table 3 - Demographics for China
- Table 4 - Demographics for India
- Table 5 - Demographics for Japan
- Table 6 - Demographics for South Korea
- Table 7 - Market Readiness Among Asian Countries
- Table 8 - Market Opportunity among Asian Countries
- Table 9 - NTT FTTH vs. Verizon FTTH Pricing
- Table 10 - Demographic Comparison between Select Provinces of China and Select Asian Countries 2004
- Table 11 - Selected Prefectures in Jiangsu Province, 2004
- Table 12 - Suburban FTTH Market Scenario
- Table 13 - FTTH Deployment Model Comparison - Japan vs Other Regions
- Table 14 - FTTH OPEX Cost Savings
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