NTCA: Rural telcos turning to FTTH, FTTN for broadband

NOVEMBER 25, 2009 -- A recent survey by the National Telecommunications Cooperative Association (NTCA) reveals that small rural communications providers are deploying fiber at what it called “an impressive pace” to enable high-speed broadband service to their customers. Fiber to the node (FTTN) is the preferred strategy, but fiber to the home (FTTH) has doubled in popularity.

NTCA's “2009 Broadband/Internet Availability Survey” found that nearly three-quarters (73%) of respondents with a fiber deployment strategy intend to offer FTTN to more than 75% of their customer base by 2011. Fifty-five percent plan to offer FTTH to more than half their customers in that same time frame -- more than doubled from just 26% last year. (View the report)

The study says that rural areas are seeing significant gains in broadband speeds, primarily due to the increased fiber availability in their communities. Fifty-three percent of respondents indicated their customers can now receive broadband service of between 3 and 6 Mbps (up from 46% last year), and 39% can receive service in excess of 6 Mbps, which is an increase from just 25% a year ago. Survey respondents indicated an increase in take rates for the higher broadband speed tiers as well.

Fiber deployment costs remain a significant impediment facing rural carriers, cited as an obstacle by 93% of survey respondents. Rugged terrain, distance, and low customer density exacerbate the problem.

Three-quarters (75%) of respondents now offer a video play, up from 68% last year. Of those, 93% offer video under a cable franchise. An additional 11% indicated they plan an offering in the future.

Most (89%) respondents indicated they face competition in the provision of advanced services from at least one other service provider, including national ISPs, cable companies, and wireless ISPs.

NTCA sent the 2009 survey electronically to all telco members in its e-mail database and 156 companies (31%) responded. Fifty-six percent of respondents' service areas are 500 square miles or larger; 27% are at least 2000 square miles. Sixty-seven percent of those have customer densities of 10 residential customers or less per square mile, with nearly one-third (31%) reporting customer densities of just two or fewer residential customers per square mile.

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