August 27, 2004 Providence, RI -- After more than 15 years fiber-to-the-premises (FTTP) is finally gaining traction, says market research and analysis firm KMI Research. In its new report, Fiber To The Premises in The United States: The Promise of Universal Broadband Access, KMI forecasts that the total FTTP market for equipment, cable, and apparatus will reach $3.2 billion in 2009. This represents a 54% compound annual growth rate (CAGR) for the forecast period.
The amount of cabled-fiber demand used in FTTP and fiber in the loop (FITL) applications in the U.S. will contribute to a 19% CAGR for the total U.S. singlemode cable market from 2003 through 2009. FITL-related fiber deployments in 2003 were less than 10% of total U.S. singlemode cabled-fiber demand but will account for more than 40% in 2009.
In 2003, there was a fledgling fiber to the home, or FTTP, market underway, consisting of approximately 100 different projects -- the majority of which were undertaken by municipalities, utility companies, real-estate developers, and other "non-telco" organizations. In 2003, the telcos contributed only 3% to the FTTP market for cable and equipment. But with the ramp-up in KMI's forecast, the telcos' deployments will grow much faster than the non-telcos' deployments. Telcos will represent 70% of this market in 2009.
One factor affecting the FTTP market's development is the distinction between homes passed and homes subscribing. KMI's report discusses the "take rate" (the percentage of homes passed that become subscribers) with the understanding that FTTP is one of several competing technologies, including CATV and DSL. KMI's forecast is based on a conservative take rate in the initial years, but it ramps up to higher levels towards the end of the five-year forecast period. These high-volume deployments, led by Verizon and other LECs, affect the market for equipment, cable, and apparatus as shown in Figure 1.
KMI's report includes forecasts for equipment, cable/apparatus, by network architecture, and cabled-fiber installations by loop segment through 2009. It also includes market information on active and passive equipment, components, cable, and apparatus, as well as installation products, capital equipment, and service providers. It contains analysis of FTTP costs, market forecasts, segment descriptions, background and discussion, carrier and manufacturer profiles.