Rim Semiconductor Company (fka RSMI)

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Fibre-to-the-home should be Germany’s broadband solution
26/02/2003 Editor: Neal S. Lachman

Broadband availability in Germany is unlikely to happen in the near term, according to a recent survey of the broadband sector by Deutsche Bank Research. However, researchers often make the mistake of looking at existing, legacy system operators, such as CATV (cable) and telephone (DSL) operators, for broadband solutions. This is a wrong approach, based on outdated way of thinking.

Fibre-to-the-home (FTTH), is the only solution for a future-proof, high-capacity, and superior-quality transmission system. CATV and Telco operators can only deliver semi-broadband access, simply because these systems are not built for the high-throughput two-way/bi-directional traffic. No matter how often and what upgrades the systems will go through, FTTH is the only economical and future-proof solution to provide traffic at true broadband speeds, which can be defined as speeds of 10 Mbps and higher, up to 100 Mbps.

FTTH is a brand-new industry, based on fairly new technologies, but it will be able to deliver us the same services as we know and use today. Better, besides delivering Internet Access speeds of up to 100 Megabits per second, FTTH operators can also provide higher quality telephone services, and broadcast many more TV networks to your TV than a cable or satellite operator can dream of. All this, plus true Interactive services and programming, real-time on-demand programs and movies or DVDs to your TV and computers.

But how can German households and (small) businesses get access to true broadband services? The answer is that only FTTH system operators will be able and willing to do something in the near future, at costs that everybody can afford.

First we need to understand that start-up FTTH operators, that enter the market as new players, without a legacy system, can be more successful and dedicated to build true-broadband infrastructures. This is because CATV or telcos don‘t feel the need to cannibalise their current revenues. The main issue is that FTTH infrastructures are not based on the legacy CATV and telco infrastructures. It must be built completely from scratch, ‘overbuilding’ as the industry calls it. On the economical side, legacy system operators have debts for hundreds of millions of dollars, if not billions. They have invested that money in building the legacy systems, thus their return on investment, or break-even-point, has still to be achieved. FTTH operators will start with zero debts, zero liabilities, just with some very smart investors who buy shares in their companies.

Secondly, given the geographic spread of cities in Germany, traditional broadband technologies won’t be sufficient. There is no need to wait for the CATV and telcos to deliver broadband services. By stimulating FTTH operators, German citizens and businesses, can bypass the semi-broadband market and go for true broadband at once. There are no technical or economic hurdles for FTTH operators. They just need to be stimulated, given the chance to get going. An appropriate technical approach for FTTH operators in Germany is, most likely, to connect to existing fibre networks for the metro-networks, use high-capacity fixed wireless technologies for the middle mile, to be inventive in laying the last mile, and wiring the building and then the homes with fibre.

In May 2002, Senator Joseph Lieberman of the United States published a report on true-broadband infrastructures. In it, he clearly recommends the United States adopt a national policy on high-speed broadband infrastructures, because it will be a goldmine, for the country, as productivity will grow. Politicians and investors in Germany - or from the whole world for that matter - should know that FTTH is a goldmine for the country.


http://www.europemedia.net/shownews.asp?ArticleID=15121