FTTH Conference 2009 Alcatel Lucent Eco Sustainability To Fiber Nation

Eco-Sustainability on the Road to the Fibre Nation Marcus Weldon CTO, Wireline Networks Product Division

Testing Times: How to Bridge Financially Troubles Waters € Anticipate and Plan to Deploy Fiber to the Most Economical Point ECO Deploy efficiently in an eco-sustainable fashion And manage the technology cycle All Rights Reserved © Alcatel-Lucent 2008, XXXXX 2 | FTTH Council Conference 2009

Continuous (and rapid) bandwidth growth is inevitable Verizon FiOS NTT 1Gb/s 100Mb/s 10Mb/s 1Mb/s Offered Data Rates 5-6 years 6-8x Increase 100Kb/s Infonetics Actual Infonetics prediction 10Kb/s Reality 1Kb/s Bandwidth consumption is inexorably growing ⇒ 100Mbps will become commonplace in the next 3-5 years, so FTTx technology will be essential everywhere… All Rights Reserved © Alcatel-Lucent 2008, XXXXX 3 | FTTH Council Conference 2009

Bandwidth evolution: Evolution in screen size will continue to drive BW need 3D TV research Personalization & Interactivity will drive future evolution in peak bandwidth requirements We are here Ultra HD / SHV HDTV 1080p HDTV 720p 3DTV Ultra HD & 3D will drive future evolution in average bandwidth SDTV requirements All Rights Reserved © Alcatel-Lucent 2008, XXXXX 4 | FTTH Council Conference 2009

Major operators have defined their FTTx strategy …and are implementing it Public announcements in Countries Incumbent Alternative Munis/util. top BB countries Australia Belgium Cable China Cable FTTAmplifier Denmark FTTN for HFC France Germany ePON / GPON P2P / AE Hong Kong Iceland Ireland N/A or TBD Italy Japan Korea New Zealand 56% of Tier1 telco carriers Norway have selected GPON Singapore Spain 33% national carriers have Sweden selected VDSL2/FTTN Switzerland Cable Cable The Netherlands P2P is primarily a VDSL2 Cable UK outgrowth or Muni strategy USA and Canada Cable Source: public announcements All Rights Reserved © Alcatel-Lucent 2008, XXXXX 5 | FTTH Council Conference 2009

FTTx is translating into numbers PON and VDSL are the technology leads CAGR 2004-2008 50 50% 100% 150% FTTx Subs WW (M) PON in Asia 40 30 PON outside Asia 20 VDSL 10 P2P 0 CY2004 CY2005 CY2006 CY2007 CY2008 As % of fixed Source: Infonetics / Analyse Alcatel-Lucent BB 3,4% 4,7% 6,5% 9,5% 13,6% subscribers FTTx (PON + VDSL) deployment in North America and EMAI is real and show high growth rates All Rights Reserved © Alcatel-Lucent 2008, XXXXX 6 | FTTH Council Conference 2009

€ Anticipate & Plan to Deploy Fiber to the Most Economical Point VDSL ~50 Mbps ADSL ~12 Mbps GPON 100 Mbps+ VDSL P2P/AE ~50 Mbps 100 Mbps+ VDSL ~100 Mbps Drivers: Up-front CAPEX, competition, and time-to-market All Rights Reserved © Alcatel-Lucent 2008, XXXXX 7 | FTTH Council Conference 2009

€ Fiber To the Most Economical Point Today: Many countries have selected an FTTN/FTTB approach Key countries Dwelling Type 100% Other Japan 90% Korea Single 80% Family Taiwan House: 70% FTTB Detached Sweden 60% Italy 50% 40% Germany Single Family 30% Belgium House: Semi- 20% The Netherlands detached FTTN Building 10% UK (< 10) 0% Building Switzerland SP IT GER GR AU FR DK LUX PT NL BE UK IRL (> 10) Pros Cons Savings on cabling in the buildings OPEX increase (power, maintenance,) Faster time-to-market Co-location for multi-operators Synergies with metro aggregation & PON Copper performance/BW limitations All Rights Reserved © Alcatel-Lucent 2008, XXXXX 8 | FTTH Council Conference 2009

Our challenge: Cut green house gas emission ECO ICT represents 2% emissions 2007 (Not at par with aviation!) 1.4 GtCO2e PCs, peripherals 2% of GHG and printers 57% Data centers 2020 0.5 GtCO2e 49% 2007 18% 58% 14% 2002 Telecom 14% 25% 37% 28% Fixed Broadband Fixed Broadband 4% 1% Telecom Devices 3% Telecom Mobile Mobile Devices Networks Networks 3% 12% 13% Fixed Fixed Narrow Narrow Band Band 12% 5% Source: Alcatel-Lucent analysis of Smart 2020 data ICT challenge: x3 increase GtCO2e from 2002 to 2020 All Rights Reserved © Alcatel-Lucent 2008, XXXXX 9 | FTTH Council Conference 2009

Our Opportunity: Stimulate eco-services ECO Emissions savings x5 ICT footprint 15% total emissions Industrial process 12% Smart Metering! Check our Smart grid Transport booth optimization 27% Network 8% related 53% 7.8 GtCO2e Other Connected 8% Smart home! buildings Check our booth Smart 21% Logistics 19% Video Teleworking conferencing 3% Source: Alcatel-Lucent 2% analysis of Smart 2020 data Opportunity: Emission savings 7.8 GtCO2e in 2020 x5 time ICT footprint (1.4 GtCO2e) All Rights Reserved © Alcatel-Lucent 2008, XXXXX 10 | FTTH Council Conference 2009

Zooming in on the active equipment ECO Findings from Product Life Cycle Analysis Other <1% CO cooling 3% Other1% CO cooling 1% CO CO power ONT power 7% prod. 13% 9% CPE GPON VDSL prod. 17% ONT power CPE power 82% 67% Source: Alcatel-Lucent and RDC environment CPE usage dominates the environmental footprint for active equipment All Rights Reserved © Alcatel-Lucent 2008, XXXXX 11 | FTTH Council Conference 2009

NW: Power reduction is on-going business.. ECO All access technologies have made significant progress Actual EU Code of EU Code of Conduct: Conduct CPE and CO > 90% of all new products ADSL, VDSL, P2P, GPON 2008: “on” and “off” 2009: on ↔ “low power state” Power reduction due to higher degree of integration, system-on-chip technology and more efficient transceivers. All Rights Reserved © Alcatel-Lucent 2008, XXXXX 12 | FTTH Council Conference 2009

NW: Breaking the OPEX trend with GPON ECO GPON provides more capacity at the lowest TCO Assumptions: 5 years cost of ownership 0.1 Euros/kWh The Business Case is in favor of eco-sustainability All Rights Reserved © Alcatel-Lucent 2008, XXXXX 13 | FTTH Council Conference 2009

ECO Solutions: Green innovation in access Customer Premises: Outside Plant: NW Equipment: Passively Cooled Remotes Duct Sharing Distributed DSLAM “Always available” CPE Micro Trenching Heat exchangers High Density Linecards All Rights Reserved © Alcatel-Lucent 2008, XXXXX 14 | FTTH Council Conference 2009

What about WDM PON? Cost Comparison of Different Technology Options CAPEX Operations TDM PON WDM PON 10G PON WDM PON GPON (10G DS/2.5G US) (Everyone Gets a Lamda) CAPEX Lowest cost FTTH x3-4 TDM PON CO Power, OPEX Low OLT CO floor space Lowest power High power Eco Splitter consumption consumption ONT Standardized Yes Not started Dynamic BW Yes Not possible Video overlay Yes Not possible Based on a 1:32 split Temp controlled or Passive OSP Passive splitters GPON Today Over Time Today Long term temp extended AWG Complex, many System Design Straight forward dependencies AWG needs to be Reliability Excellent athermal & reliable WDM PON solutions are eco-'challenged’ All Rights Reserved © Alcatel-Lucent 2008, XXXXX 15 | FTTH Council Conference 2009

Summary FTTx has passed the point of no return € Operators are deploying FTT€ ECO Deployments can and should be eco-sustainable ….For both current and future technologies All Rights Reserved © Alcatel-Lucent 2008, XXXXX 16 | FTTH Council Conference 2009

FTTH Conference 2009 Alcatel Lucent Eco Sustainability To Fiber Nation

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