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  • 1. Feature Articles: Optical Fiber CommunicationsFTTH in ChinaWang JianliDeputy CTO, Fiberhome Technologies Group, Wuhan, China ABSTRACT current broadband access status in China is provided to help to understand the great potential in FTTHThis paper provides current status and future trends growth in the future; In Section 3, the driving forcesof FTTH in mainland of China. It discusses current for FTTH are analyzed; Section 4 provides currentFTTH research, development and deployment status status and latest activities in FTTH research,in China, including technology choices, deployment development, and deployment; different FTTH tech-considerations, major equipment vendors and carriers, nologies are analyzed in Section 5 according tostandardizations, market barriers and opportunities. service and application requirements; the major FTTHKey words: FTTH, market, China players and products are presented in Section 6; In spite of all the progress made in the last two years, there are still a lot of challenges to face, which are I. INTRODUCTION discussed in Section 7; while there are a number of barriers to overcome for FTTH, there are also someIn the last a few years, China has seen a rapid growth opportunities, which are discussed in Section 8 to-in broadband access. With the increasing require- gether with some proposed strategies. The paper isments for bandwidth by new applications, fiber to the summarized in Section 9.home (FTTH) has been drawing attention of bothresearch and industry in China since Nov 2003 whena number of Chinese experts started the latest II. CURRENT STATUS OFFTTH wave in China at the APOC 2003. Since BROADBAND ACCESSthen, a great progress has been made in FTTHresearch, development and deployment. This paper In the last a few years, the number of Internetis to provide a general view about the FTTH in subscribers in China grew very fast. By March 2005,China. China had 73.45 Million Internet users. Among FTTH means differently by different people. ITU- them, 28.33 Million are broadband users, 95% in-T defines FTTH as fiber to the household, where no crease over 2004, and 8 times of that in 2002,copper between Central Office (CO) and household. accounting for 38.6% of all Internet users. In spite ofWhile in the definition by FCC of the United States, the growth of broadband users, dial-up is still theFTTH includes both household and small business. dominating access solution in China, accounting forIn this paper, we define FTTH as to include single 61.3%. A small number of subscribers also usehousehold, small business and multi-dwelling apart- leased line for Internet access. In comparison, inment building. March 2004, the dial-up users accounted for 79.5%, This paper is organized as follows: in Section 2, broadband 20.4%. We can see a great growth inChina Communications December 2005 89
  • 2. Feature Articles: Optical Fiber Communications broadband access in 2004. It is forecasted that Chinas fee is about $12 per subscriber. In China, the de- broadband users will reach 144 million by 2007. ployed DSL so far are all ADSL. In late 2004, Those broadband users are potential FTTH subscrib- ADSL2+ products became mature and were tested ers because they have experience what broadband by service providers. The massive deployment of can bring to them. ADSL2+ is expected to start late 2005. China al- ready has mature VDSL products, but we have not 2.1 Access service requirements seen urgent deployment requirement because ADSL2+ is able to provide high bandwidth and To understand fiber access in China, we need to therefore will delay VDSL deployment or even make understand the service requirements of different type VDSL deployment unnecessary. of subscribers. In China, the access users can be Ethernet is another important access technology in divided into three major categories according to their China. With this approach, fiber from central office service requirements. reaches a point close to residential area or a building, Large corporations: this category includes head called optical drop. From this optical drop a LAN quarters of large corporations, large government leads to each home or office. With this approach, departments, universities, financial institutes, each home or office usually has FE interface. media, hotel, business building, etc. This type of Another major category of access technology in users usually has large-sized private network China is broadband fixed wireless (BFW). There are and has high requirement for network availability, three types of BFW deployed. WLAN based on 2.4 security and quality of service. The major access GHZ is the most promising fixed wireless technol- services required by this type of users are vari ogy in China. 3.5Ghz is another promising ous leased line services. technology, while 5.8G deployments has just started. Medium and small-sized enterprises: this type of In addition to above broadband access technologies, users has a relatively wide range in access net cable modem also has some market share. PLC has work capacity. The services they need include a very small market in China. So far the optical DSL, DDN, FTTx+LAN, dial-up and ISDN. access is mainly FTTB and FTTC. In China about The line speed is from a few ten k , 512k, 1M, 2M 90% of business buildings have fiber drops. Some to 10/100 M. residential communities also have fiber drops. Residential users: for this type of users, the major services are voice and Internet access. These users are more caring about simplicity, plug and III. DRIVING FORCES OF FTTH play, and cost. The major access approaches include dial-up and DSL. In terms of FTTH driving forces, China is not differ- ent from the rest of the world. There are five major 2.2 Technologies forces that are driving FTTH research, development and deployment in China. According to above access users categorization, the major broadband access technologies include ADSL, 3.1 Increased bandwidth demands LAN, broadband fixed wireless (BFW), etc. In China, ADSL has been dominating access The most important driving force for FTTO and market. The line speed of ADSL is from 512K to 2M. FTTH is that more and more broadband applications But most subscribers are using 512k and 1M. The need more bandwidth. In the last a few years, Chinas equipment price has been dropped dramatically in broadband access grows very rapidly. The increas- the last a few years. Now the central office equip- ing rate is about 200% every year. In addition to the ment price is around $40 per subscriber. The monthly old applications such as web surfing, email, and file90 China Communications December 2005
  • 3. Feature Articles: Optical Fiber Communicationsdownloading, many new applications and services 10 provinces in Northern China. China telecomhave been become popular. Examples include online owns local network resource in the rest part ofgaming, IPVOD, and videophone. Those applica- country mainly in Southern China, For the 10tions need much more bandwidth. provinces in Northern China, China Telecom Another important application is broadcasting TV. needs to find another approach to provide localChina has launched a national TV digitalization access services to compete with ADSL proprogram. The goal is to stop analog TV nation-wide vided by local carriers. Vice versa, Chinaby year 2015. Currently, the TV programs are deliv- Netcom needs to do the same thing in Southernered by a separate network operated by CATV, China. Other carriers including China Unicomhowever, the nation is promoting convergence of and China Mobile almost have no local networkCATV network, PSTN network and the Internet, facilities and also need FTTH for competition.especially for the access portion, to realize triple- For local carriers to bypass residential serplay. With HDTV, the bandwidth requirement is vice providerseven higher. The bandwidth need for a typical family In 2001, China started a trial program to openis estimated to be around 100Mbps. With that amount access network to residential service providers.of bandwidth, none of the current available broad- With this trial, a new model, known as "Tailongband access technologies is able to meet the needs. Model" in China, emerged. With this model, a new type of service provider, residential net3.1 Reduced system cost work service provider, owns residential netAnother important driving force for FTTH is the cost work facilities and is able to connect to anyof optical-electronic components reduced dramati- local carriers network according to residentscally thanks to technology advancement. In the past choice. In order to bypass the residential servicea few years, almost all the optical components used providers network, local service provider prefor FTTH saw a great drop in cost. Fiber is now about fers to have their fiber reached each home$16 per kilometer and optical transceiver at 1000M directly. FTTH is one way to that about $80 per unit. The cost of Ethernet card, For telecos and CATV providers topassive optical component, etc keeps dropping every compete for data accessmonth. Reduced system cost makes FTTH and FTTOeconomically acceptable. Currently CATV providers are not allowed to provide telephone services and Telecos not3.2 Competition allowed to provide CATV services, but both are allowed to provide Internet services. ChineseCompetition is usually a driving force for applica- government is working on the regulations fortion of any new technologies and there is no excep- CATV n e t w o r k a n d t e l e c o m n e t work.tion for FTTH. In China, FTTH is widely accepted as Convergence. Now it is very important to ownthe dominating broadband access technology in the access facilities so that it will likely own thefuture. Although there is no urgent immediate de- subscribers in the future. Although the finalployment needs, most carriers and service providers goal is for the subscriber to freely access to anyare active to promote FTTH because they have service providers network they want, but in arealized that sooner or later FTTH will take off and certain period of time, the access network andthey need to occupy the territory. This competition the local service will be in monopoly.can be seen in the following aspects: 3.3 Market For CLECs to compete with ILECs China Netcom owns local network resources in FTTH has a huge market. It is not only for the FTTHChina Communications December 2005 91
  • 4. Feature Articles: Optical Fiber Communications system and equipment, but also the devices, 4.2 FTTH products accessories, manufacturing, and services. Assuming 100 million FTTH subscribers within 5 years, it is The very first FTTH system was developed in 2001 estimated that Chinas average FTTH annual market in China by Fiberhome Technologies Group as part is between $30 - 40 billion. of the effort of the national 863 APON plan. Now there are a number of FTTH equipment vendors. 3.4 Regulatory Fiberhome ranks number one with most advanced technology and richest functionalities. Other local In many cases, new technology promotion needs vendors include UTStar, Greenwill, Fohope, Huawei encouragement from governments regulation. So and ZTE. far, Chinese regulation is not favorable for network Up to now, most local vendors focus on EPON convergence and therefore not for FTTH. But some system and point-to-point system. GPON system is local government is considering of setting rules to under consideration by some vendors, but none has promote FTTH deployment. For example, new-built mature products yet. There is only one WEPON house or apartment must have fiber deployed. Those vendor, Fohope. The FTTH products can be basi- rules will help to promote FTTH deployment. cally divided into three categories according to their capability of service support. First category is that can only support data service, such as Fiberhomes IV. CURRENT FTTH STATUS IN CHINA 100M EPON and 1000M EPON, UTStars 1000M EPON, etc. This type of FTTH system can only In APOC 2003 held in Wuhan, many Chinese telecom provide Internet access. The second category can experts discussed FTTH in China for the first time in only support data interface and CATV interface by the last a few years. The topics include FTTH oppor- using a separate wavelength. Those products include tunities and challenges, FTTH applications, FTTH Fiberhomes point-to-point FTTH system and Fohope network architecture, cost analysis, etc. That forum WEPON system. The third category is real triple attracted a lot of attention of Chinas telecom com- play, using three wavelengths to support all data, munity and become a starting point for this new TDM/voice and analog or digital CATV services. FTTH wave. All above products are mature and have deployed in a number of field trials and commercial deployments. 4.1 National FTTH research plan 4.3 Field trials and commercial networks FTTH research activities in China actually started in 1999 when China launched FTTH research and Since 2002, there have been a number of field trials in China. Wuhan Changfei FTTH project in 2003 development program to study key technologies of was to demonstrate the feasibility of various FTTH FTTH and develop FTTH systems. The first research systems. The project consists of three building with program is a national "863" hi-tech program called 87 homes. The equipment vendors include APON. That program completed in 2001. Another Fiberhome, Optical Solutions, Fohope Networks, similar state "863" hi-tech program on EPON started Salira, and Wave 7. The FTTH systems deployed in 2001 and completed in 2003. A number of organi- include 100M EPON, 100M P2P, and WEPON. The zations with Fiberhome Telecom as the leader took services provided include Internet and CATV. The part in those two programs, the results are positive. service is provided by Wuhan Telecom. This project In Chinas "eleventh five years plan" period, many concludes that (1) FTTH products are mature to be proposals have suggested FTTH as one of the major commercially deployed; (2) the cost of the FTTH is area for government financial support. still very high in comparison with ADSL. Another92 China Communications December 2005
  • 5. Feature Articles: Optical Fiber Communicationsfield trial in 2003 is Chengdu FTTH project by FTTH network deployed and commercially oper-Chengdu Tailong, the only residential service pro- ated by China Netcom in Beijing. It provides triple-vider in China. The project is designed to provide play with GEPON system from Fiberhome. Thetriple play through a single fiber. The total number of project was completed and started commercial op-homes covered by this project is about 4000. The eration in July 2005. In addition to above, a biggerequipment vendors include Fiberhome, etc. Currently, FTTH project has been planned. It is an FTTH/the service providers connected to this residential FTTO network for combined residential and busi-FTTH network include China Telecom and China ness district. The district occupies about 7 squareRailcom. In addition to above two, there are more kilometers with a population of 160,000. The dis-than 30 other field trials all over the country to study trict will use FTTH and FTTO for all the home andthe business model and network operation and business access.maintenance. The first FTTH equipment testing by Carrier was 4.4 Standardizationcompleted in Dec 2004 by Beijing Netcom. Therewere five FTTH equipment vendors participated in With the progress made in FTTH research, develop-the test: Fiberhome, UTStar, ZTE, Huanwei and ment and deployment, China started FTTHGaohong. The equipment tested is GEPON and the standardization. CCSA has just stared an FTTHresult is positive. Among the five vendors, Fiberhome standard task with Fiberhome as the primary taskis much more advanced in system functionally and taker. There are also two local government levelperformance, especially in multi-service support. FTTH standard programs on going, one in WuhanThe result shows that the FTTH technology and and the other in Hangzhou.products in China are mature for commercial There is also an FTTH forum in China to promotedeployment. Beijing Netcom has also completed an FTTH technology and deployment. The forum wasFTTH interop test. formed in 2003 and has been very active in organiz- The first commercial FTTH network by key ing various activities.carrier in China is Zisong FTTH project in Wuhanby Wuhan Telecom, it consists of 420 subscribers,and the equipment is Fiberhomes 1:32 triplex V. FTTH TECHNOLOGYGEPON. The services provided include POTS voice, CONSIDERATIONSVOIP voice, IPTV, CATV, Internet access and TDMleased line. This network was deployed by (Wuhan) Currently, the three major FTTP technologies com-China Telecom in a brown field for old multi-dwell- monly considered in China are EPON, GPON anding apartment buildings. The network operation P2P. APON will not be deployed due to its com-started in Jan. 2005. In Aug. 2005, Wuhan South plexity and high equipment cost. Those three tech-Lake FTTH network was completed. This com- nologies are complimentary rather than conflicting.mercial FTTH network was deployed and commer- EPON is mainly used for FTTH in the area withcially operated by China Netcom for new buildings high population density; GPON will be mainly usedin Wuhan. The GEPON equipments and cable used for corporations that need large number of TDMin this project were provided by Fiberhome. This leased line services. P2P can be used for bothproject has about 700 subscribers. The services pro- business cases and residential cases. For businessvided are the same as Zisong project. The only case, P2P will be used when the required bandwidthdifference is that this project uses two fibers with one is more than that a PON can provide. For residentialfiber exclusively used for CATV services. Beijing case, P2P is preferred than EPON when the residen-broadband house FTTH network is a commercial tial homes are scarcely located.China Communications December 2005 93
  • 6. Feature Articles: Optical Fiber Communications 5.1 EPON will be dominating FTTH market 5.2 GPON will be mostly used for FTTO In China, for FTTH and some of FTTO cases, EPON GPON is a new PON standard proposed by ITU-T. is preferred than GPON. The considerations are as The biggest advantage of GPON is its support for follows: multiple services, especially the TDM service. While Technology wise, EPON is more mature than some EPON products can also support TDM service, GPON at present time. Most Chinese FTTH ven but GPON can provide TDM service in big capacity dors can provide EPON systems, although they and relatively straightforward way. For most busi- are different from each other in multi-service nesses and enterprises, TDM leased line service is support. While GPON is relatively new technol required. Although EPON can also provide TDM ogy and there is no mature GPON products in service, when the number of TDM T1/E1 is large, it China yet ; is neither easy nor efficient for EPON to provide it. EPON can meet all the service requirements for In this case, GPON is a preferred solution. In some residential uses. For family home usage, the corporation or business cases, other leased line ser- services need to be supported are POTS vices such as ATM and frame relay, are also required. telephone, maybe fax, Internet access (file GPON is able to carry those services. download, IPTV, games, etc), and CATV. 5.3 P2P will not be widely deployed Fiberhome EPON equipment can meet all the above requirements. It can provide telephone Currently, the biggest advantage of P2P type of service by using either VOIP with embedded FTTP system is its flexibility in terms of bandwidth IAD (Integrated Access Device) function in expansion. Because each user has a dedicated fiber ONU or through TDM (E1/T1) over IP; It can exclusively used for itself, the bandwidth can be provide Internet access in a straightforward way easily expanded when needed. Therefore, it is very because of its Ethernet based transport nature; It good for those with large bandwidth needs and fast provides CATV service through a third wave bandwidth increase. However, P2P type of FTTP length which is dedicated for analog CATV system has a problem, that is, lower central office transport. The fax service can be either through equipment density. In comparison with PON system, telephone line over IAD or via VOIP T.38. it has more ports (one for each end user) in central EPON is very easy for NGN evolution. NGN office, and therefore more central office space, more is the future of the network. One of the key power consumption, more likeliness of system features of the NGN is that it will be packet problems. This problem becomes server especially based, while IP network is widely accepted as in big cities where central office space is limited. the transport network of NGN. Ethernet based Another problem with P2P is that it needs more fiber. EPON is very easy for NGN evolution because Although fiber cost keeps dropping, the fiber/cable Ethernet is the best layer 2 technology for IP installation and deployment is still very expensive, support. especially when new pipe needs to be placed. So in EPON equipment is cheap. Ethernet is one of the China P2P system will not be widely deployed. widely used layer two technology, more than 5.4 Multi-service support is required 80% of the IP traffic is now carried by Ethernet. Ethernet protocol is very mature and many In China, one of the driving forces for FTTH is types of Ethernet cards have become commodity. network integration, or triple play. This is different Because of all above, EPON equipment is from that in Japan, where the FTTH is mainly used cheap. for Internet access in most cases. In China, especially94 China Communications December 2005
  • 7. Feature Articles: Optical Fiber Communicationsfor the new building, FTTH needs to support triple- WLAM combined solution might be useful in someplay or all-play. Although CATV network and cases. With this solution, FTTH has optical drop attelecom network are currently separate, there are the door and then the voice and Internet access ismany efforts for network convergence. The separa- provided by WLAN, and the video service is con-tion of CATV program and network is under nected the TV set through cable. For this solution, thegovernments consideration. The "Telecommunica- ONU of the FTTH system has to provide WLAN APtion Law" to be issued soon will likely relax the function in its ONU. Another case for the functionrestrictions on telecom service operation, to allow integration is to integrate the home gateway functionthird party to run telecom services. All of those are into FTTH ONU. The extra function may includegood signs that the government encourages the inte- various interfaces for home security, hydro andgration of the three networks, especially for the power meter reading; TV STB can be also integratedaccess portion. into FTTH ONU. With all those functions integrated, the ONU actually acts as a home gateway. With this5.5 FTTH functionality expansion solution, each family has only one box at home providing multiple communication, entertainment,Currently, most FTTH systems only functions as monitoring and other functions.transport system. A typical FTTH system is consist-ing of an OLT and multiple ONUs. An FTTH equip-ment is consisting pure FTTH function only. The VI. MAJOR FTTH PLAYERSvendors are now considering of expending the AND PRODUCTSfunctionality of the FTTH system in the followingtwo aspects. After a few years of research, development, and field The first expansion is multiple OLT function for trial of FTTH, now FTTH products are mature and asmooth evolution. Currently, FTTH has not been number of carriers are showing strong interests inwidely deployed in China. In the near future FTTH FTTH commercial deployment. This section willwill not completely replace existing access solutions, describe the major FTTH equipment vendors andespecially DSL solutions. DSL and FTTH will coex- major for a long time. In a residential area, it will be verylikely that some homes prefer FTTH while others 6.1 Major FTTH service providersprefer DSL. So an integrated function OLT is a good Currently, China Netcom is the most active FTTHsolution: a single chassis consists of both ADSL and promoter. It views FTTH as part of its "Broadband"FTTH (e.g., EPON) cards and those different cards strategy. China Telecom and China Railcom are alsocan be configured by any combination according considering of building FTTH networks. Anotherto the customers requirements. For the uplink new service provider called Tailong is very muchinterfaces, the equipment can provide interfaces promoting FTTH by encouraging government toto different networks, including PSTN, Internet open residential networks.and CATV network. For China Netcom and China Telcom, in the cities Another expansion of FTTH is integrated ONU for where they have local network facilities, they want tohome network. The typical FTTH ONU only per- use FTTH for new residential buildings, in the citiesforms optical termination and provides different where they dont have local network facilities, theyinterfaces for family usage including RJ11, RJ45 and try to use FTTH to compete with their competitorsCATV cable interface. Recently, local area and for access networks. For Tailong, it wants to build itshome wireless technologies such as WLAN are own residential networks and perform network op-mature and accepted by the industry. An FTTH and eration and maintenance while leave the service toChina Communications December 2005 95
  • 8. Feature Articles: Optical Fiber Communications service providers. The driving force for them to build Technologies, UTStar, Greenwill, and Fohope FTTH network is to expend its residential networks. Networks. Fiberhome ranks number one in terms of product maturity, functionality richness, and current 6.2 Major FTTH equipment vendors deployment in China. Since 2001, a number of equipment vendors started Another type of FTTH equipment is Ethernet to develop commercial FTTH systems. Those ven- based P2P system to use one fiber for each ONU. It dors include Fiberhome Technologies, UTStarcom, can also support triple-play and TDM leased line Greenwill, Fohope Networks, Huawei and ZTE. services. Most of those companies have their FTTH products deployed in various field trial FTTH networks. In VII. MARKET BARRIERS addition to the domestic companies, there are also a few foreign companies participating FTTH field trial Since Nov. 2003, FTTH has become a very hot topic in China, including Wave 7, Optical Solutions, and in Chinas access networks, there have been a lot of Flexlight. forums, technical papers, state funded research pro- grams and a number of field trials going on. There are 6.3 Major FTTH system products also a number of commercial FTTH networks. But There are a number of FTTH equipment vendors in massive commercial deployment and operation of China. The major FTTH systems include EPON FTTH in China seems to have a number of barriers to system and point-to-point system. There are also one overcome. These barriers include high system cost, vendor developing WEPON system and some con- lack of killer applications, lack of encouraging sidering GPON system. In the following, we briefly regulations, and competition from other technologies, describe the EPON, point-to-point, and WPON sys- as discussed below. Those barriers are not standing tem of a few vendors. along, but inter-dependent. According to the application it supports, current EPON products in China market can be divided into 7.1 High system cost three types: (1) for data services only; (2) for both data services and TDM/voice services; (3) for data, The biggest barrier for massive FTTH deployment in voice/TDM and analog CATV services. China is that the cost of FTTH system is very high A typical EPON system follows IEEE 802.11 in comparison with ADSL. Currently, the ADSL standards. One system can have 32 EPONs and equipment cost is about $40 per line, while that for support 1024 subscribers. It uses 1.31 and 1.49 for FTTH is about $200 per sub for Internet access only upstream and downstream TDM and data and $500 per sub for triple play. So FTTH is not respectively, and 1.55 for downstream video. TDM attractive especially for the brown field where the service is provided by TDM over IP. Both TDM existing telephone service and CATV service are users data and the synchronization signals are en- already available. capsulated on RTP on top of UDP/IP. Each PON can 7.2 Lack of applications support 32 or 64 end users. Downstream 1000M is shared by all the 32 users; upstream bandwidth is Another problem with FTTH deployment is that dynamically adjustable with a granularity of 512K there are no killer applications for FTTH. Although within the range of 0~1000M. System is protected. It the overall bandwidth requirements are keeping provides traffic control, priority control, DBA and increasing, but there is no one killer application that many OAM functionalities. makes FTTH a must. Currently the most Internet The main EPON vendors include: Fiberhome applications are low bandwidth applications. CTAV96 China Communications December 2005
  • 9. Feature Articles: Optical Fiber Communicationsis the number one bandwidth consumer, however, and for other services with new VOIP and othercurrently in China, CATV programs are not allowed similar technologies. Both HFC and LAN are ableto be carried by networks other than Broadcasting to provide triple play.and TV network. Fixed wireless technologies are other barriers for The new applications include IPTV and gaming. FTTH deployment. Those technologies includeBut none of them need more than 5Mbps bandwidth. WLAN and the newly developed WiMAX. ThoseHDTV is considered to be the killer application technologies can provide enough bandwidth.because it needs much more bandwidth than manyexisting applications, however it is not available inChina yet. So lack of applications is another big VIII. MARKET OPPORTUNITIES ANDbarrier to FTTH. DEPLOYMENT STRATEGIES7.3 Regulations As we discussed in Section 7, we have many difficul- ties to overcome before massive FTTH deploymentFor most new technologies, its application at early in China. But we also have some opportunities asstage needs governments regulation encouragement. described below.The FTTH in Japan and broadband in South Koreaare good examples. The bundling rule issued by FCC 8.1 Starting with FTTOof the United States for FTTH is another goodexample. But so far central Chinese government has When we discuss FTTH, it actually includes twonot taken any measures to promote FTTH. types of application environment: one is FTTH and the other is FTTO. For FTTH case, one of the major7.4 Competition from other technologies issues is its high cost. But that issue is not that serious for FTTO case. For FTTO, the customers are moreAnother factor which prevents FTTH from massive concerned about the services and stability of thedeployment is that existing access technologies are system, while the system cost is not their number onegood enough for current various usages. Without TV concern. In comparison with todays existing accessprograms to be carried by the telecos access network, solutions, FTTO is not that costly considering itsthe current ADSL is good for most service and TDM leased line services. A case study shows thatapplications. The ADSL deployed in China today for the small business office usage, the paybackcan provide bandwidth of 2M for each subscriber. period for telecom operator for FTTO is about two2Mbps is good for most family usage. The new years with assumption of 50% take rate at the endversions of ADSL, ADSL2+ can provide much of the second year. So one of the strategies formore bandwidth (25Mbps) in many cases. That is promoting FTTP in China at present time is forenough for todays and most of the futures business office use.applications. ADSL2+ has been tested by a num-ber of carriers in China and will start to be 8.2 FTTH for the new residential districtdeployed late 2005. In addition to ADSL, HFC and LAN are also Although FTTH is not really needed and not eco-competing with FTTH. For broadcasting TV, HFC nomically realistic at the present time, especially foris the most preferred solution at present time due to the brown field, the industry accepted that FTTH isits existing network infrastructure and regulation the future of broadband access. So for the newrestrictions regarding to TV program broadcasting. building, people prefer to have fiber to be deployedLAN is also a good solution for the green field to home rather than to have copper for now and fiberbecause it is straightforward for Internet access to replace copper a couple of years later. What isChina Communications December 2005 97
  • 10. Feature Articles: Optical Fiber Communications more, the cost for copper and fiber deployment is environment. For example, for the brown field where compatible for the new builds. people already have phone service and CATV service, So one way to promote FTTH is for carriers to the FTTH system only needs to provide Internet work together with house builders. FTTH as a com- based services, the system can be very simple and the cost can be much lower. munication system is expensive, but in comparison with a house, it is nothing. In China, many people have their houses luxury furniture. For the new IX. SUMMARY houses, people prefer to have their wire (or cable, fiber, etc) to be deployed at the construction time FTTH has been very hot in China since 2003. Now, rather than after the house is furnitured. When people the FTTH equipments suitable for Chinese market are believe that FTTH is a trend, they can accept the mature. A number of carriers have been started FTTH current cost. So the FTTH deployment can be bundled field trials and commercial deployments. Chinas together with house construction. FTTH standards are under active study. Some local Chinese governments are considering new regula- 8.3 Competition tions to encourage FTTH deployment in China; the Chinas national "863" hi-tech program also has FTTH As we described before, there are different aspects of related projects funded by the government; there is competition, for CLEC to compete against ILEC and also an FTTH forum in China to promote FTTH for telecos to compete against CATV providers. technology and deployment. Technology wise, there Three networks convergence is an ideal network are a number of choices including various PON system, infrastructure to avoid duplicate network point-to-point and WDM. Study shows that EPON is one of the best choices for FTTH (including small construction. That is more important for access business) while GPON may be the best choice for networks. Although this cannot be realized in the FTTO according to their application environment and near future, but people realized that it is the trend, service to be supported. Although China has made a sooner or later the three networks will be converged great progress in FTTH research and deployment in into one. With that belief, CATV and Telcos are last a few years, there are still some challenges to competing for FTTH territory. That will also drive further FTTH deployment. Among those challenges FTTH deployment. So the strategy is to take the best are high FTTH cost and lack of killer applications. But advantage of competition. at the same time, some short-term FTTH opportuni- ties have been provided and a few suggestions were 8.4 HDTV needs FTTH presented for equipment vendors and service providers. Although HDTV has not been popular in China, people accept that it will happen in the near future. BIOGRAPHY When customers started to demand HDTV, then the best access solution is FTTH. The strategy is there- Wang Jianli , Ph. D. Deputy CTO of Wuhan fore to promote HDTV. Research Institute of Posts and Telecoms (also known as Fiberhome Technologies Group). He obtained his 8.5 Flexible solutions for different envi- Ph D. from Beijing University of Posts and Telecoms ronment in 1992. His professional experience includes re- search and product development in PDH, SDH, ATM, The cost of the FTTH system is very much dependent IP over ATM, MPLS, IP over WDM, VoIP, NGN and the services it provides. The system cost for triple FTTH. He is now leading a team responsible for play is much higher than that for Internet access only. technology directions and product strategies of So we need to differentiate different application Fiberhome Technologies Group.98 China Communications December 2005