U.S. is fastest-growing SMF market
The United States is the fastest growing market for singlemode fiber (SMF), deploying 20,000 fiber-km in 2005 alone, reported Patrick Fay, senior analyst at KMI Research, during the company’s 28th Annual Conference on Fiberoptics Markets, held in Providence, RI, on Nov. 14-15, 2005.
According to Fay, the United States will continue to be the most dynamic market for SMF between 2005 and 2010, registering a 7% compound annual-growth rate (CAGR) versus the worldwide average of 5%. A flurry of activity by the incumbent carriers will drive this growth, with Verizon’s fiber-to-the-premise (FTTP) initiative leading the charge. The RBOCs plus AT&T accounted for a little less than 50% of singlemode cabled fiber demand in 2004. By 2005, they deployed nearly 60% of the total SMF in the United States.
In his “Fiberoptic Cable Market Update,” Fay compared SMF demand among the U.S. “Big Three” (BellSouth, Verizon, and SBC) versus Europe’s “Big Three” (British Telecom, Deutsche Telecom, and France Telecom). He estimates that the installed base of SMF in the United States will dwarf that of Europe in 2010, with the U.S. “Big Three” deploying more than 80 million fiber-km versus Europe’s 30 million fiber-km.
The Asia-Pacific region is the largest market overall and will continue to be so through 2010. The region will account for 46% of singlemode cabled-fiber demand from 2002 to 2010, but growth will be a slow 3% CAGR over the forecast period.
Glynn Stainthorpe, managing consultant in wire and cable for CRU International (London), also offered a forecast of the worldwide singlemode fiber market, which he expects to reach 81 million fiber-km by 2008. Like Fay, Stainthorpe points to the United States as a major market driver-both today and in the long term. For example, he noted that the third quarter of 2005 experienced a 9% increase in SMF demand, driven by Verizon’s and SBC/AT&T’s deployments as well as the rebuilding efforts on the Gulf Coast following hurricanes Katrina and Rita.
Fay highlighted the key applications driving SMF demand in the United States between 2002 and 2010, including long distance (2%), local (23%), cable TV (9%), and other SMF uses (12%). By far the biggest market is and will continue to be fiber in the loop, which will account for 54% of the total SMF market over the forecast period.
Fiber-to-the-home (FTTH) was a popular topic throughout the two-day conference, beginning with Fay’s discussion of the impact of Verizon’s FiOS initiative on the overall FTTH market. In September 2004, Verizon had passed just 30 communities with fiber (nine of which were active), but by September 2005, Verizon had passed 490 communities, representing 26% of the total U.S. FTTH market. Of those 490 communities passed with fiber, 170 were active as of September 2005.
In fact, FTTx is the fastest growing segment of the worldwide fiber-optic cable market, noted Joe Savage, KMI contributing analyst and senior vice president of the FTTH Council. In his presentation, “FTTP: Four million subscribers and deployments are spreading!” Savage noted that as of March 2005, a total of 1,619,500 homes in the United States had been passed with fiber. Just six months later, that number had jumped to 2,696,846 homes passed. By year-end 2006, Savage forecasts that the U.S. total will reach 7 million homes passed.