Archive for March, 2016

Liberalisation driving Fibre Broadband growth in Macau

Thursday, March 31st, 2016

Macau boasts a sophisticated, independently regulated communications market due to Macau’s status as a Special Administrative Region (SAR) of the People’s Republic of China following its handover from Portugal. Gradual liberalisation has now fully opened the telecoms market with the full impact slowly becoming evident. Demand for telecom services is significantly driven by the millions of visitors that visit the tiny enclave every year.  87% of visitors classified as residents of mainland China or Hong Kong.

Macau’s fixed-line market is transitioning to a fibre broadband market as the incumbent Compahnia de Telecomunicações de Macau (CTM) invests significantly in fibre access networks. As of 2016 CTM had deployed fibre broadband coverage to the majority of residential units and 100% of commercial buildings. CTM’s investment coincides with the entrance of Macau’s second fixed-line operator MTEL, with the latter a threat to the monopoly CTM has over the fixed broadband market, a monopoly made possible due to CTM’s ownership of the underlying fixed access network.

CTM’s aggressive tactics are showing results as the majority of households are expected to be connected via fibre by 2017, closing the window of opportunity for MTEL to poach subscribers from CTM’s sizeable DSL subscriber base. CTM faces another potential competitor in Macau Cable TV operator which is obliged to expand the reach of its underground cable network sixfold by 2017.

Macau’s mobile market is the most competitive sector of the telecoms market, with four mobile network operators and a mobile virtual network operator (MVNO) offering services. Competition is intense, with mobile penetration in excess of 200% due to multiple SIM card ownership as well as sales of SIM cards to visitors. Mobile broadband presents an alternative revenue growth opportunity, with LTE launches during 2015 allowing operators to offer more enticing products. In December 2015 CK 3 Macau launched its 4G LTE mobile network, making it the fourth and final LTE licensee to introduce commercial 4G services in the Special Administrative Region (SAR).

For detailed information, table of contents and pricing see: Macau – Telecoms, Mobile and Broadband

We invite your comments: Comments Off on Liberalisation driving Fibre Broadband growth in Macau

Is building FttH cheaper than upgrading the HFC networks

Wednesday, March 30th, 2016

Within the debate of the Multi Technology Mix of the Australian NBN, where the HFC also gets included in this mix for approx 20-25% of the connections, it interesting to follow the debate on the upgrade of this infrastructure in America.

Cable networks around the world are now faced with a major technology upgrade known as DOCSIS 3.1 and also in Australia the NBN company has indicated it is also in their plans to upgrade the 20 year old networks they have bought from Telstra and Optus along those lines.

However, as more and more information becomes available and the first companies involved in such upgrade are getting some first hand experience of the work that is needed and they see the first results of the upgrade, an interesting discussion is taking place regarding the costs involved in relation to the upgrade of the HFC networks in comparison to the cost of building FttH networks. With the new results available to them, the argument now is that in many cases the cost of a full transiting from DOCSIS 3.0 to 3.1 are so great that it would be more cost effective to go to FTTH.

The discussion around this develops as follows. Initially it was thought that upgrading the HFC network simply  involved the bonding of channels in the downstream that are being freed up in the new standard by going to MPEG4 or that it simply would be a matter of turning off analogue part of the network.

However, it has become clear that just doing that is rather pointless.  Because this is not going to make the service much faster than it already is, and at some point, there is not enough upstream capacity to enable the operator to actually use all that downstream bandwidth.

DOCSIS 3.1 does support upstream capacity with much more bandwidth, but to do that, operators have to increase the amount of spectrum allocated to the upstream service, so it is more symmetrical.  Right now, in North America, the HFC cable operators run ‘subsplit’ upstream: 5-42 MHz on the upstream, and 50-860 or 1 GHz in the downstream.  Changing that split requires changing every diplexer in every active component in the network.

This is a very substantial amount of work. If operators take the upstream beyond 75 MHz, then the set top boxes (STB) will also have to be changed.  And this all assumes that TV’s are no longer plugged directly into the cable, otherwise they will need a low pass filter installed, because the cable modem transmits at up to 1000x the power of the downstream, and if they go past 50 Mhz the hi-pass filter on the TV won’t protect its frontend against a signal that strong.

Not only does this upgrade create a large amount of work it will also potentially causes a large amount of network downtime as the HFC plant gets rebuilt.

So the logic is that if operators are going to try and fix the upstream element of the network (this is the Achilles heel of the HFC network), it could add up to be more expensive than an FTTH overbuild, particularly if it is possible to overlash the fibre on the existing HFC plant and if it are aerial drops to the home.

In the underground case, it is less compelling unless you can somehow replace the copper with fibre in an easy way.  Most of that wasn’t pulled through conduit, so in that case it is a nasty and expensive problem. In the US, multi dwelling unites (MDU) also don’t have anything more than coax for inside wiring (the copper pair is too slow), so going FTTH there means a lot more cost to rewire the building.  In many cities, these last two issues (MDU inside plant and underground cabling) probably means the cable operator will have to spend a lot of money and as a result we see that the operator while adding FttH to its service will still opt to keep the HFC in place rather than go to a full FTTH service.  There are indeed several examples of this in the USA.

So in the short term at least, most cable operators will do the “light touch” approach, because they have not signalled to the market a capex profile that can afford anything but that.  And they hope that this will be good enough to fend off gigabit networks being deployed by competitors.

If that works, it could be enough to keep sufficient number of subscribers on their HFC network and they can at least for now avoid the FttH overbuild. According to some, this is the best case scenario for them – and in cases of little or no competition they even could avoid deploying the DOCSIS 3.1 light touch upgrade all together.

If however, these tactics are not going to work, and they find themselves losing share to FTTH competitors, then things get more difficult for the cable operators.  They will than have to make decisions if they can take the subscriber losses and still be in business, or they need to do what ultimately is unavoidable and upgrade to FttH.. Being aware of what needs to be the final decision, some operators are now doing part overbuilds, in cases where there are enough people prepared to pay a premium price for a FttH service based on a minimum 2-year contract basis.

Paul Budde

See also:

We invite your comments: 2 Comments on Is building FttH cheaper than upgrading the HFC networks

New Zealand’s Ultra-Fast Broadband network approaches half-way point

Tuesday, March 29th, 2016

New Zealand’s telecom sector is being transformed by the continuing deployment of the key national infrastructure, the UFB. This ambitious undertaking is fundamental to the country’s broadband landscape, and is underpinning the emerging digital economy as well as the burgeoning digital media sector. As the overall market is being bolstered by the fixed-line and mobile broadband segments, the fixed-line voice market (voice calls and local access) continues to lose overall share of telecom services revenue.

The uptake of mobile broadband is supported by the expansion of mobile technologies based on LTE and by the Rural Broadband Initiative rollout which is adding a large number of mobile cells to new or underserved areas. A February 2016 survey showed that New Zealand retains the second highest overall LTE data speed, behind Singapore. There have been considerable gains made in LTE services, with effective competition between Spark, Vodafone NZ and 2degrees. All three now also operate in the fixed-line sector, thus supporting their bundled services strategies.

UFB is scheduled to be completed by 2020, and by early 2016 about 540,000 premises had been connected. This infrastructure will enable the residential and business segments to make far better use of the potential for IP-delivered services and content, and will help the country maintain its position at the forefront of the digital future.

This report provides analyses of the New Zealand telecoms market. It covers the mobile voice and data sectors, including operating and financial statistics for the three MNOs as well as an assessment of their strategies as they exploit their presence in the fixed-line market to compete more effectively. The report also reviews the digital economy and digital media markets, includes a snapshot of social media usage, as well as updates and data on e-government, e-health and e-learning developments.

For detailed information, table of contents and pricing see: New Zealand – Telecoms, Mobile, Broadband and Digital Media – Statistics and Analyses

We invite your comments: Comments Off on New Zealand’s Ultra-Fast Broadband network approaches half-way point

Lifting of sanctions expected to assist telecoms sector in Iran

Tuesday, March 29th, 2016

Iran has become one of the most interesting telecoms markets in the Middle East to watch with the lifting of economic sanctions in 2016. This development paves the way for increased foreign investment in Iran and in turn for Iran to participate in international commerce.

With Iran also gaining access to billions in frozen assets it will be able to improve its overall economic position, along with the lifestyle of Iranian citizens. This in turn may lead to more spending on mobile data and telecoms services along with overall telecoms infrastructure improvements.

Iran offers a relatively young population, where the majority are aged below thirty years old and enthusiastic adopters of mobile technologies and ICT tools. Mobile phone penetration stands at around 90% and this has grown quickly in recent years due to increased competition and the introduction of 3G and 4G services.

It is hoped that the flourishing start-up sector in Iran will receive a boost due to increased foreign interest and investment. Iran has already demonstrated its commitment towards a start-up sector with many locally established digital media initiatives in operation – many of which have emerged due to Iran’s desire to develop its own social media and digital services. These include Iran’s own search engine, Yooz, as just one example.

E-commerce can also expect growth with the lifting of sanctions freeing up electronic trade and Iranians begin to gain access to some international financial institutions and corresponding credit cards. Bitcoin is also showing a keen interest in the potential of Iran’s e-commerce market with the crypto-currency service establishing its first Currency Exchange in Iran during 2015.

Other changes are afoot for Iran’s telecom sector with the announcement that TCI would be selling a 50% (plus one share) stake in the company, currently owned by Etemad Mobin. This development, combined with the lifting of sanctions and a tech savvy youthful and very large population – has firmly placed Iran in the spotlight as one of the key markets to watch for growth and opportunity.

For detailed information, table of contents and pricing see: Iran – Telecoms, Mobile and Broadband

We invite your comments: Comments Off on Lifting of sanctions expected to assist telecoms sector in Iran

Lake Macquarie Smart Council, Smart City

Tuesday, March 29th, 2016

Lake Macquarie City Council has laid the foundation for creating a more connected, innovative and resilient city, with the adoption of the Lake Mac Smart City, Smart Council Digital Economy Strategy.

A key development here has been that the council started this project by looking internally. They understood that if they were to develop a smart city they first had to make sure that they themselves could operate as a smart council. From the start the strategy was supported at the highest level within council – the CEO, the Mayor, councillors and the key council directors. They also appointed a smart city officer who could work on a horizontal level within the organisation, which is, like all other councils, typically silo-based.

A key element in their strategy is how to deploy new technologies to make a more connected and sustainable and innovative city.

Through Dantia, the city’s economic development company, local businesses and other important stakeholders were brought into the development of the strategy in a collaborative way.

With all of this in place council looked at the low-hanging fruits – what projects could be initiated that could show its citizens what this is all about.

They held extensive community consultations, workshops and ideas competitions throughout the council area, which is comprised of nine communities – each with its own strong sense of community, but each with different problems. This process is also supported by a website that continuously interacts with the citizens.

The strategy that they announced in March 2016 identifies 18 initiatives that will help boost the local economy, improve the council’s performance and ultimately enhance the lifestyle of residents.

As part of the strategy, council will be using video content when publishing council news. It is also investigating the use of solar-powered mobile device-recharging benches at parks, has introduced smart meters and solar panels at community facilities, and is supporting co-working space.

Other initiatives identified in the strategy include rolling out free Wi-Fi in council-operated spaces; developing an online tool to improve community access to property flood information and conditions; implementing smart infrastructure and smart systems; and investigating options for replacing council’s ageing mobile library.

With a solid strategic foundation in place Lake Macquarie is well-positioned to build its smart city – one that will deliver a range of social and economic benefits for all players involved and will create a more liveable, workable and happy city to live in.

I am proud to have been able to play an advisory role in this process.

Paul Budde

See also:

We invite your comments: Comments Off on Lake Macquarie Smart Council, Smart City