NOVEMBER 22, 2006 - According to Dittberner's (search for Dittberner) "Broadband Quarterly Shipment Analysis," FTTH shipments were down 1% from the first quarter, as the Japanese market reaches cruising speed and Verizon worked off a build up in inventory. The market was up 58% year over year.
Japan provided 81% of the market in the third quarter, down from 83% in the second quarter. Japan is at an annual run rate of 3 million FTTP subscribers added, which was its goal, and is expected to be the average growth for the next 10 years. Verizon is the largest FTTH installation outside of Japan, and even though it increased subscribers for its FTTH service, FiOS, by 32%, shipments to it decreased.
Four of the top five leaders in shipments, Mitsubishi, Sumitomo, Hitachi, and UTStarcom, are all main suppliers to Japan. Tellabs, who is Verizon's main FiOS supplier, is the third-place vendor.
Europe is showing signs of activity with a municipal network in Amsterdam and pilots in Paris with Free and France Telecom. Kuwait has a project underway that should provide 80,000 FTTH subscribers over the next 9 months. Smaller operators in the US added 125,000 subscribers in 3Q06, while Verizon added 147,000 FiOS subscribers.
Asia Pacific (APAC) is the only region that is doing a large number of FTTP installations. In Japan, about 40% of the subscribers are in multi-dwelling units. This makes the ratio of OLTs to ONTs lower in this market than in others. APAC also differs in the technology being used. APAC is deploying GEPON, while Verizon, until now, has deployed BPON. GPON will start to be deployed by Verizon in 2007, and is becoming the technology of choice by service providers in Europe, where active Ethernet had been the bulk of the installations.
With Japan having reached its target implementation rate, growth in FTTH will probably slow until other major service providers join Verizon in rolling out FTTH. Major project announcements by North American and European Tier 1 service providers are likely as GPON technology becomes widely available and the desire to offer advanced TV services like HDTV and VOD increases. Dittberner expects that GPON usage will continue to grow and become the dominant technology for FTTH.
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