Fiber deployment on long-distance routes by pan-European carriers will fall dramatically this year, claims a new report from KMI Corp. (Providence). Pan-European fiber deployments peaked at 57,000 route-km in 2001; deployments in 2002 will be only one-10th of those last year.
As network sizes and fiber counts increased, fiber deployment grew exponentially, claim KMI analysts. Starting with 180,000 fiber-km in 1997, pan-European carriers deployed 1.3 million fiber-km in 1998, 4.3 million in 1999, and 6.1 million in 2000, for a compound annual growth rate of 225%. Deployment declined to 5.6 million fiber-km in 2001, due to the large proportion of undersea construction.
A flood of new pan-European carriers entered the market from 1998 to mid-2000, driven by steep acceleration of bandwidth demand, the deregulation of European telecommunications markets, and the emergence of new telecom technologies. By route size, network deployment grew from almost 3,600 route-km in 1997 to roughly 15,000 in 1998, 43,000 in 1999, 53,000 in 2000, and 57,000 in 2001.
But pan-European network expansion is coming to a near-halt this year and into 2003. The decline results from the end of a construction cycle, less availability of financing, falling capital-expenditure budgets, and business performance problems that have led some carriers to bankruptcy procedures, contends the report. Of the 27 carriers profiled, five are experiencing financial difficulties or have sold their networks. Though carriers plan to deploy 580,000 fiber-km this year, some of that could be cancelled. KMI predicts that fiber deployment will dip again next year to 180,000 fiber-km, just enough to bring fiber to prospective cities not yet on major networks. Today's carriers are focused on getting the most out of their existing assets, and that trend will likely continue.
KMI's report, "Fiberoptic Networks of Pan-European Carriers: Market Developments and Forecast," profiles 27 major fiber-based pan-European carriers, highlighting their own-built network, segments under lease, and network plans. For more information, visit the company's Website at www.kmicorp.com.