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Significant Cost Savings for ISPs that Adopt True Fibre Optic Broadband

Friday, April 5th, 2013 (1:31 pm) - Score 1,681

A new study of more than 350 ISPs in North America by market analyst RVA LLC has claimed that operators, which upgraded from slower copper line base broadband (e.g. ADSL) networks to faster fibre optic (FTTH/P/B) platforms, saved an average of 20.4% via operational expenditure (OPEX).

The study, which was commissioned by the FTTH Council Americas, suggests that the major savings were extracted through lower maintenance and repair costs. Related studies, some of which have been conducted for the European Commission (EC) by different market analysts, tend to show similar findings.

ftth cost savings 2013

Heather Burnett Gold, President of the FTTHCA, said:

This latest survey shows not only the continued build-out of high-bandwidth fiber to the home networks in North America, but also provides one reason why hundreds of small and medium sized telcos have been upgrading to fiber – it saves them real money in the long run.”

Michael Render, President of RVA LLC, added:

While it is clear from our survey that many prospective FTTH providers continue to face funding difficulties and regulatory uncertainty, many are still finding ways to upgrade to all-fiber because doing so reduces their maintenance costs and strengthens their opportunities to expand their subscriber base and offer customers more services.”

It goes without saying that the FTTHCouncil has a vested interest in plugging Fibre-to-the-Home (FTTH) style broadband connections, which can deliver stable internet speeds that most typically extend from 100Mbps (Megabits per second) and all the way up to several Gigabits. Most consumers would also welcome the prospect of a faster and more stable broadband connection.

Few tend to dispute that such infrastructure, once installed, is usually cheaper to maintain. By comparison copper lines are more expensive to replace and often also much more vulnerable to problems like interference, distance related performance loss, water damage and so forth.

But the main problem still tends to reside with the massive first-time cost of installing a new FTTH infrastructure, with a majority of the investment usually going towards civil engineering tasks such as street works (digging up pavements and roads etc.).

Lower maintenance costs are welcome but getting past that first hurdle, which is especially costly for connecting the “last mile” fibre directly into homes and businesses, remains the biggest single hurdle to overcome.

This is one reason why many operators, such as BT, have opted for hybrid-fibre solutions like FTTC that only take a fibre optic cable to your local street cabinet but retain the last mile copper run into homes over VDSL2; slower but cheaper to deploy. But in the future such networks might eventually need to become full FTTH platforms as copper lines could struggle to keep pace with growing requirements.

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By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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