Making the case for FTTH

Nov. 1, 2001

A growing number of companies from various sectors of the optical and broadband industries has formed the Fiber-to-the-Home Council.


Even in today's troubled tech economy, few would deny that the marriage of fiber-to-the-home (FTTH) and interactive broadband holds the promise of a match made in technology heaven. One offers a virtually endless river of bandwidth to nourish the other's vast but vulnerable crop of seedlings, helping as many as possible to blossom into healthy new services ripe with broadband revenue.

But like the institution of marriage, the pairing of FTTH and broadband is an easy target for skeptics armed with stories and statistics about past failures. FTTH's early history and the more recent savaging of the overheated dot-com and telecom sectors provide plenty of ammunition for such attacks.

Sure, it's true that a good share of FTTH and broadband initiatives have suffered the fate of all-too-many marriages: romantic and sexy during the honeymoon, but ultimately ending in failure and disillusionment. But a simplistically cynical attitude is neither justified nor helpful in diagnosing the problems and finding solutions.

The industry's recent woes and FTTH's history highlight the need to understand their lessons and explore new ways in which an FTTH/broadband coupling can propagate strong businesses and vibrant markets. As in any marriage, communication, mutual understanding, and cooperation are essential. Recognizing that, a growing number of companies from various sectors of the optical and broadband industries have joined together to form the Fiber-to-the-Home Council.

The council held its first meeting Aug. 23 in Rochester, NY, where it elected eight members to its board of directors and formed a number of task-oriented committees. Attending were 75 individuals from 43 companies, representing a range of equipment manufacturers, integrators, and service providers. By Sept. 7, the Council had grown to 56 member companies, with a second meeting scheduled for Nov. 8.

According to board president Doug Wrede, director of business development at Optical Solutions, the council's early organizers had originally hoped to attract 18-20 companies. Wrede says the August meeting was marked by both a surprisingly large turnout and a cooperative atmosphere, the latter suggesting that members view the council as a win-win proposition.

Expressing an enthusiasm not often heard in descriptions of industry forums, Wrede says, "the last time I had goosebumps like this was when my daughter was born." Though our conversations with other board members and committee chairs uncovered no other cases of goosebumps, all shared Wrede's enthusiasm about the council's goals and potential and the initial industry response to it. The first meeting's attendance and positive atmosphere suggest they are not alone in this opinion.

Board secretary Mark Klimek observes that, after many years of trials, a sense had developed in the in-dustry that FTTH "cost too much" and that "the market wasn't developed enough" to support it. But with the advent of the Internet, digital video, and converged IP services on one hand and next-generation FTTH gear on the other, this longstanding assumption is now out of date, he suggests. Klimek is director of marketing and business development at Alcatel's Advanced Systems Group.

In a written statement following the meeting, newly elected board vice president James Salter, president of Atlantic Engineering, said the council was "committed to providing the industry with accurate and timely information about how to deploy FTTH technology right now."

Toward that end, the council formed a number of committees at its August meeting. The two largest committees, each with more than two dozen members, are addressing the key questions of why, when, where, and how to deploy FTTH.

The Market Segmentation, Analysis & Development committee will work to identify different FTTH market segments and project each segment's growth in demand and willingness to pay for bandwidth and services. The chairman of this group is Max Nelson, senior manager, strategic business planning, at Optical Fiber Solutions (Lucent Technologies).

The findings of Nelson's group will serve as inputs for the "Economic Modeling and Architectures" committee. The latter will develop FTTH business models by combining its sister committee's revenue analysis with network cost data gathered from member companies. The modeling committee's chairman is Jeff Tompkins, strategic technology analyst at Corning Cable Systems. The council's emphasis, says Tompkins, will be on comparing FTTH's costs and capabilities to alternatives such as HFC and twisted-pair networks.

To its credit, the council is taking great pains to develop a system that will steer clear of competitive and antitrust issues related to sharing of cost data. Initial indications are that it will succeed and that members see plenty of room for productive cooperation without triggering the kinds of concerns that can poison the well when competitors get together in industry forums.

Noting the positive attitude at the council's first meeting and within his committee, Tompkins says the systems being worked out for information sharing will protect confidentiality and ensure that no contributors jeopardize their own company's value propositions by sharing information.

One of the primary objectives of the council's Government Relations committee will be to act as an interface between members and governments at the federal, state, and local levels, says committee chair James Herbert, president of iWired. The council's Technology committee is chaired by Jim Farmer, chief technology officer at Wave7 Optics. Among its goals, says Farmer, are to keep council members aware of standardization groups and field trials with relevance to FTTH's development and, where appropriate, promote standards that could aid that development.

According to Mark Alrutz, chairman of the Education committee and director of technical services at CommScope, his group's central task is to take the information and insight generated by other committees and "translate it into formats people can understand," including white papers and presentations at industry forums. His committee will also help identify potential audiences for the council's message, which Alrutz says is likely to include "anyone in-terested in deploying broadband networks."

We encourage Lightwave readers to contact the FTTH Council (e-mail: [email protected] or Website: and consider joining its effort to better understand and promote a new generation of FTTH business cases. After all, when was the last time you got goosebumps?
Mitch Shapiro has been tracking and analyzing the broadband industry for more than 12 years. He currently directs the strategic research program of Broadband Markets, which develops and markets proprietary databases, financial modeling tools, and strategic reports focused on the competitive broadband industry. He can be reached at [email protected].

Don Gall has been involved with the cable-TV industry for the last 28 years. He was an integral part of the team at Time Warner that developed the first practical applications of analog fiber and hfc networks. He is currently a consultant with Pangrac & Associates (Port Aransas, TX) and can be reached at [email protected].

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