FTTH Council Europe cheers Spain, scolds the UK

In the latest update to the Fiber to the Home Council’s FTTH ranking, Spain is one of the fastest growing fiber nations in Europe while the UK is the slowest. The FTTH Council Europe offered a preview of its official data at the NextGen 12 conference in London ahead of the official announcement next week.

Spain is one of two new countries to join the European FTTH ranking this time around, the other being Luxembourg. That brings the total number of countries in Europe with more than 1% of households subscribing directly to fiber connections to 22 out of a possible 39 (the ranking also includes Russia and the Commonwealth of Independent States, or CIS).

Overall there are now about 5.95 million FTTH subscribers in the EU35 countries and the study also counted a further 6.3 million in the CIS region. This corresponds to a modest increase of about 16% in the number of subscribers connected across the EU35 during the first six months of 2012.

To put this into context, the Asia Pacific region had 58 million FTTH subscribers at the end of June 2012, while the FTTH Council North America recently announced that the number of FTTH subscribers on that continent had passed 9 million (see “FTTH Council Americas releases FTTH market numbers”). Europe is still a minor actor on the world stage when it comes to FTTH.

The fact that Spain, a major European economy, has joined the ranking is a source of delight for the Council. It is always harder for a country with a large population to do well in the ranking because the position is determined as a percentage of the total homes in the country.

Progress in Spain has been driven mainly by the Spanish incumbent, Telefónica, although cable operator Ono and Orange Spain have also been investing in FTTH. By the end of June 2012, Telefónica had passed around 1.7 million homes, giving it the distinction of having the largest FTTH network deployed by an incumbent operator in Europe.

Following some pilots projects in 2007, Telefónica decided in 2010 to roll out FTTH across the cities of Barcelona and Madrid. The operator is taking FTTH very seriously, says Carlos Bock, a broadband consultant in Spain. “This year they finished covering Barcelona and they are almost done in Madrid as well,” he wrote in his blog. “The next step is to push hard and invest €1.2 million over the next three years to cover 50% of the Spanish population.”

However, other major economies like the UK and Germany are still noticeably absent from the ranking, and the situation is unlikely to change anytime soon, the Council reports. In fact, the UK was singled out as the country with the lowest FTTH penetration in the whole of Europe: just 0.05% of households take a fiber subscription.

Despite the fact that the government has announced its intention to have the best superfast broadband network in Europe by 2015, the UK has no large-scale FTTH deployment plans. “We see a big gap between the so-called ambition of the UK government to have the leading broadband infrastructure in Europe and the actual targets of the plan,” said Nadia Babaali, communications director of the FTTH Council Europe. “We should be talking about gigabits, not adding a few megabits onto a DSL connection.”

One crucial missing element is competition. In countries like Spain, cable operators and alternative telcos have decided to upgrade or expand their networks, which has forced the incumbent to change its approach. Although the UK has a competitive retail broadband market, at the wholesale level the access market is dominated by the incumbent. While BT’s next-generation access roll out does include some FTTP, the majority of its investment is focused on FTTC (see “BT launches FTTP service, promises 300 Mbps next year”). Small local projects can claim more FTTP subscribers than BT, but none of them have the scale to challenge the incumbent.

With its annual conference taking place in London early next year, the FTTH Council Europe is keen to drive home the message that the UK needs to step up its efforts on FTTH or risk being left behind in the digital economy. “The infrastructure is needed now because it takes time for people to connect and it takes time to develop the services and applications that power the digital businesses of the future,” said Babaali. “Let’s get out of this chicken and egg situation [consumers and businesses can’t demonstrate demand for services that aren’t yet available], and recognise that this is our future.”

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