NTCA members like FTTH, but recognize challenges

Feb. 5, 2020
Members report that 64% of their customers (on average) received services via FTTH in 2019, with just more than half of survey respondents predicting that this number will reach approximately 85% by 2025. Yet obstacles stand in the way of such goals.

NTCA–The Rural Broadband Association in December released results of an annual study of its members that indicates rural cable operators and other broadband service providers are increasing their deployments of fiber to the home (FTTH). In fact, members report that 64% of their customers (on average) received services via FTTH in 2019, with just more than half of survey respondents predicting that this number will reach approximately 85% by 2025. Yet this figure won’t be reached without overcoming a few hurdles.

The “NTCA 2019 Broadband/Internet Availability Survey Report” reveals that in addition to the high percentage of FTTH connections, members connect another 9.3% of subscribers via fiber to the node (FTTN). Copper loops account for 22.7% of connections, with cable modems far behind at 2.4%. The remaining subscribers are linked via unlicensed fixed wireless (1.1%) or licensed fixed wireless (0.7%). The 64% number for FTTH in 2019 represented an increase of nearly 6%, coming at the expense of FTTN and particularly copper loops, which each showed year-on-year declines in use. And more FTTH deployments are in the cards; additional fiber deployments were the most frequently cited short-term (54.3%) and long-term (51.4%) service improvement strategy.

Not surprisingly, the move to FTTH coincides with a need to meet greater bandwidth demands. The percentage of customers taking services at downstream rates of 25 Mbps and above has risen from 17% in 2016 to 50% in 2019. That said, the percentage of subscribers accessing services at 100 Mbps and greater remained fairly small in 2019 – 14.6% for between 100 Mbps and 1 Gbps and only 3.4% for 1 Gbps and greater. Nevertheless, an increasing number of NTCA members are readying their networks for gigabit broadband, with survey respondents asserting that, on average, 25.3% of subscribers can receive a maximum downstream speed greater than or equal to 1 Gbps.

It don’t come easy

Of course, rolling out FTTH isn’t a snap, the survey respondents indicated. Eight factors (not including “Other”) were cited as challenges by at least 9% of responding members.

Top of mind, of course, is cost – 91.4% cited this factor as a hurdle. In response to a separate question, NTCA says respondents put the average cost to provide 100-Mbps capabilities to subscribers who don’t have it now at $28.7 million. Happily for FTTH technology providers, the 91.4% for FTTH’s price is a slight decrease from the 93.1% who cited cost as a barrier in 2018. Meanwhile, “obtaining financing” was cited as a challenge by 12.1% of respondents – not insignificant, but not enough to be a major headwind among NTCA members.

The second most frequently cited challenge, at 55%, was “long loops.” This obstacle became more significant in the minds of survey respondents in 2019; it was mentioned by 46.6% of respondents in 2018. Meanwhile, “regulatory uncertainty” was named a hurdle by 43.6% and “current regulatory rules” was listed by 15.7%. Regulations, of course, can come from several levels of government, and NTCA members must deal with local and state regulations as well as those handed down by the Federal Communications Commission. Still, this concern may be easing somewhat, as regulatory uncertainty scored significantly higher (59.4%) in the 2018 survey.

Rounding out the list of obstacles were “low customer demand” (mentioned by 20% of respondents), “obtaining cost-effective equipment” (12.1%) and “fiber order fulfillment delays” (9.3%). Given the relatively small numbers of subscribers taking services at 100 Mbps and greater as cited above, it stands to reason that 20% of service provider respondents are unsure of the timing of investment return on new FTTH builds.

Despite these obstacles, as mentioned earlier, NTCA members continue to plan additional FTTH deployments. Just under 25% of NTCA survey respondents’ customers still don’t have access to 25-Mbps broadband service. And NTCA’s membership appears determined to reduce that number.

About the Author

Stephen Hardy | Editorial Director & Associate Publisher

Stephen Hardy is editorial director and associate publisher of Lightwave and Broadband Technology Report, part of the Lighting & Technology Group at Endeavor Business Media. Stephen is responsible for establishing and executing editorial strategy across the both brands’ websites, email newsletters, events, and other information products. He has covered the fiber-optics space for more than 20 years, and communications and technology for more than 35 years. During his tenure, Lightwave has received awards from Folio: and the American Society of Business Press Editors (ASBPE) for editorial excellence. Prior to joining Lightwave in 1997, Stephen worked for Telecommunications magazine and the Journal of Electronic Defense.

Stephen has moderated panels at numerous events, including the Optica Executive Forum, ECOC, and SCTE Cable-Tec Expo. He also is program director for the Lightwave Innovation Reviews and the Diamond Technology Reviews.

He has written numerous articles in all aspects of optical communications and fiber-optic networks, including fiber to the home (FTTH), PON, optical components, DWDM, fiber cables, packet optical transport, optical transceivers, lasers, fiber optic testing, DOCSIS technology, and more.

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