Happiness doesn't result from what we get, but from what we give. Ben Carson
Idea Transcript
GRUPPO TELECOM ITALIA
Access network between technology and regulation
The next-generation access network : transition from copper to fiber optics L'Aquila –January 19th 2011
Gianfranco Ciccarella
Index ► ► ► ►
NGAN Drivers Challenges in the deployment process Telecom Italia Approach Final Remarks
Telecom Italia
IEEE – Italy Chapter Access network between technology and regulation
Bandwidth demand… for Services ADSL Web surfing Video communication HQ SDTV VoD Peer-to-peer, File sharing Video communication HD
1.y 1.y
SDTV Live Gaming, Distance learning
xDSL evolution
Web Hosting E-Health HDTV
NGAN
Remote Storage Next Generation 3D TV Mobile Backhauling 100
50
20
10
5
5
Upstream Gianfranco Ciccarella
Mbit/s
10
20
50
100
Downstream 3
IEEE – Italy Chapter Access network between technology and regulation
Bandwidth demand… for Mobile “The backhauling rule”: UltraUltra-BB mobile services require UltraUltra-BB fixed network
LTE & HSDPA Multicarrier
Gigabit Ethernet
HSDPA MIMO up to 28 Mbps
N G A N
HSDPA 64 QAM up to 21 Mbps
HSDPA up to 14.4 Mbps
Copper access network
HSDPA up to 7.2 Mbps HSDPA up to 3.6 Mbps UMTS up to 384 kbps
Gianfranco Ciccarella
1-2 E1
4 E1
8 E1
4
IEEE – Italy Chapter Access network between technology and regulation
“3-Zeros” Network Third Party Services
Service Provider
Telecom Services SERVIZI
Ecosystem of Services
CONSUMER ELECTRONICS
Zero CAPEX Service Enabler
MANAGED Services
Zero Faults
Overlays of automatic virtualized components
Access
IP Platform
Wireless Wired (Fiber)
Other resources / networks/ terminals
Optical Platform
Zero OPEX
Aggregation
Gianfranco Ciccarella
Edge
Bit Carrier
General Control and Management (Zero Touch)
Core
5
5
IEEE – Italy Chapter Access network between technology and regulation
Traffic / Costs / Revenues Trends
180
Price index 1995-2008 (Italy)
Traffic
150
Voice Dominant 120
Diverging trend
90
60
Revenue 1995
Year
2008
FOOD & DRINKS
ALCHOOL & TOBACCO
CLOTHES & SHOES
HOUSING
FURNITURE
HEALTH
TRANSPORTATION
TELECOMMUNICATION
SPORT, CULTURE, RECREATION
SCHOOL
HOTEL & RESTORANTS
OTHERS
Gianfranco Ciccarella
Data Dominant “Flat Rates”
Time
6
Index ► ► ► ►
NGAN Drivers Challenges in the deployment process Telecom Italia Approach Final Remarks
Telecom Italia
IEEE – Italy Chapter Access network between technology and regulation
The Fiber dilemma Fiber access network is the evolutionary path, but…
Investment and costs
Services
Regulation
Focus on sustainable deployment
Gianfranco Ciccarella
8
IEEE – Italy Chapter Access network between technology and regulation
Investment and costs Very huge effort
Geographical differentiation
Long term investment on Access Network High impact on processes, personnel skills and Systems High cost of InIn-Building Cabling Investments and costs
Services
Gianfranco Ciccarella
Regulation
9
IEEE – Italy Chapter Access network between technology and regulation
Different costs for different urban area Black Areas
Grey Areas
White Areas
High Competition
Reduced Competition
No Competition
1300 k HH.
700-800 €/U.I.
> 1000 €/U.I.
450 €/U.I.
Capex per HH
Urban Density 120k HH. 35 k HH 10 k HH 1 town 13 towns
64 towns
Gianfranco Ciccarella
138 towns
8100 municipalities
10
IEEE – Italy Chapter Access network between technology and regulation
Services New Ultra BB services Investments and costs
Services
Regulation
Demand Uncertainty Low Delta ARPU expected
?
Huge investments
Emulation Simulation Substitution
Very Long term ROI expected
Old services Migration Gianfranco Ciccarella
11
IEEE – Italy Chapter Access network between technology and regulation
Regulation Investments and costs
Clear regulatory rules are required
Infrastructure competition and coco-investment Services
Geographical differentiation of obligation and pricing
Regulation
Symmetrical obligation for access to passive infrastructure
Telecom Italia Positioning on regulatory aspect is consistent with EC Recommendation on NGAN Gianfranco Ciccarella
12
Index ► ► ► ►
NGAN Drivers Challenges in the deployment process Telecom Italia Approach Final Remarks
Telecom Italia
IEEE – Italy Chapter Access network between technology and regulation
Copper and fiber will co-exist Broadband evolution
Ultra broadband evolution
Capacity
Capacity
NG PON 2 >40 Gbps down/up Up to 40 km
Vectoring
DSL Quality Management
XG-PON 10 Gbps down, 2.5 Gbps up Up to 40km
Re-transmission
GPON 2.5 Gbps down, 1 .25 Gbps up Up to 20 Km
More xDSL efficiency stability
2009
2010
2012
Year
Copper: increase performance and robustness
Gianfranco Ciccarella
2009
2010
2012
2015
Year
Fiber: from 100 Mbps to symmetric Gbps
14
IEEE – Italy Chapter Access network between technology and regulation
Mobile Access: from BB to UBB 100 Mps
Mobile Broadband
LTE
30 Mps HSPA ev.
14 Mps HSPA 2
7 Mps 3 Mps
MOBILE BROADBAND MOBILE INTERNET
HSPA 1
300 kps 100 kps 10 kps
MOBILE TV
UMTS
eMAIL
EDGE
GSM 1992
2001
Gianfranco Ciccarella
2003
2007
2008
2009
Time 2010
15
15
IEEE – Italy Chapter Access network between technology and regulation
Reference Architecture and Technology VERY DENSE AREAS Cabinet Central Office
Secondary Network
Primary Network
FTTH
GPON technology
LESS DENSE AREAS
Cabinet
Central Office
Primary Network
Secondary Network
FTTC
Gianfranco Ciccarella
16
IEEE – Italy Chapter Access network between technology and regulation
Deployment Sustainability Payback Black Areas
Grey Areas
White Areas
High Competition Level
Reduced Competition
No Competition
Payback vs. Revenue
1300 k HH.
700-800 €/U.I.
> 1000 €/U.I.
Low density areas
450 €/U.I.
Capex per HH
Urban Density 120k HH. 35 k HH 10 k HH 1 town 13 towns
64 towns
138 towns
Medium density areas
8100 municipalities
High density areas Traffic Voice Dominant
Revenue per user €
Diverging trend
Regulation Revenue
Willingness to pay
Data Dominant “Flat Rates”
World Economy
Time
Gianfranco Ciccarella
Service Attractiveness
17
IEEE – Italy Chapter Access network between technology and regulation
Fiber
Copper
Telecom Italia NGAN Deployment Start deployment in 13 towns by the 2012: FTTH
13 town
0,1÷1 Gb DOWN 0,1÷1 Gbps UP
25÷50 Mb DOWN 5÷20 Mbps UP
VDSL2
FTTC
Start deployment in 125 towns by the 2018:
125 town
ADSL
End of Digital Divide FTTE 3÷20 Mb DOWN 0,2÷1 Mbps UP
UBB Mobile solutions
8.000 municipalities Gianfranco Ciccarella
18
IEEE – Italy Chapter Access network between technology and regulation
P2P vs GPON GPON
Central Office
20.000 users
200 fibers
P2P vs GPON
CAPEX Increase (Passive Infrastructure only) in the range +35%+35%55%
200 fibers Splitter
T-ODF
Central Office
P2P 20.000 users
20.000 fibers
Space requirements: ~34x of GPON MWh: ~ 16x of GPON
Gianfranco Ciccarella
20.000 fibers
X-ODF
Users
CAPEX Increase (Passive Infrastructure and Equip.) in the range +60+60-90% 19
IEEE – Italy Chapter Access network between technology and regulation
Home Networking Indoor installation sometimes not so easy… easy…
More than one new Home Component
Presa RJ
Rj
Old Installation
Kitchen Bedroom
Pc STB
HN
ONT
Presa RJ
NTR
Tv Presa RJ
NTRi
Office
AG
Pc
AG
ONT
Living Room Bedroom Bath room Rj
Optical Fiber
HN is a very complicated issue to solve for broadband customers … … and a real challenge to solve for narrowband customers. Gianfranco Ciccarella
20
Index ► ► ► ►
NGAN Drivers Challenges in the deployment process Telecom Italia Approach Final Remarks
Telecom Italia
IEEE – Italy Chapter Access network between technology and regulation
CAPEX intensity vs. revenue growth Revenues Growth CAGR ‘09‘09-’14
20%
16%
Onliine Services Revenue growth remains modest due to competition/regulation mix
12%
8% Connectivity 4%
0%
0% 2% 4% 6% 8%
30% 32% 34% 36% Gianfranco Ciccarella
2009 Capex / Revenues
► For connectivity CAPEX intensity remains high driven by usage growth but revenues is stable due to severe price competition and high levels of penetration ► Online Services are expected to see high revenue growth driven by video contents.
Bloomberg; A.T. Kearney and TI analysis 22
IEEE – Italy Chapter Access network between technology and regulation
Investments and costs
Focus on sustainable deployment Regulation
Services
For each SERVICE… ---
…the right “Customer”… EndEnd-User
Seamless Availability
Average bit/rate
Content Provider
Error Rate
Brand Advertiser
TwoTwo-sided
Backwards Compatibility
…the right Quality… Peak bit/rate
OTT Provider
Security
…a possibility… Market Models
---
Latency
…the right Price… Needs Evolution Gianfranco Ciccarella
Regulation
Competition 23
IEEE – Italy Chapter Access network between technology and regulation
Internet Access Business Model: a two-sided market A right balance…