Russia drives European fiber surge

Russia is spearheading a surge in Fiber To The Home or Building (FTTH/B) across Europe, with its subscriber base soaring by 42 percent during the second half of 2012 to reach 7.5 million by December.

This was more than all 27 member states of the European Union (EU) combined, but growth in fiber connected homes generally accelerated there too, putting on 15 percent, or 820,000 to scale 6.24 million, according to a survey just published by the FTTH Council. Apart from Russia, where much of the growth came from the part of the country in Europe, Turkey, Ukraine, Spain, and Bulgaria were the fastest gainers.

In Turkey, the number of FTTH subscribers doubled, while Spain was the odd one out in being a country with a collapsing economy but fast expanding broadband population. The country is investing in infrastructure, including high speed rail travel as well as broadband, in the belief that in the long run this will lay the foundation for a sustained economic recovery.

The Scandinavian countries are also expanding fiber coverage fast, but the UK and Germany drew criticism from the FTTH Council for failing yet again to qualify for a ranking on its list by having 1 percent of households directly connected. But here, the council is getting too hung up on its agenda to push fiber to every home and denigrate Fiber To The Cabinet (FTTC), which combined with VDSL2 technology over relatively short copper loops up to a few hundred meters long can still deliver large amounts of bandwidth up to 300Mb/s with the help of advanced crosstalk cancellation techniques.

In the UK, for example, incumbent Telco BT has decided to deploy FTTC nationally, with only limited FTTH/B, in order to give many homes sufficiently fast broadband as quickly as possible . This approach has enabled it to provide high speed broadband at speeds around 40Mb/s to 13 million homes, matching the coverage of cable company Virgin Media, its rival in broadband and pay TV. At the same time, the UK is also proving successful at galvanizing remote communities to lay their own fiber through a combination of government subsidy and voluntary labor.

The FTTH Council claimed that its survey revealed a strong correlation between FTTH/B roll out and economic performance, but this does not really stand up to scrutiny. It is true that some Eastern European countries are enjoying growth but that is from a low base, while Germany may have retreated slightly but is still Europe’s only economic powerhouse and second only to China in the league of world exporters, just ahead of the U.S. Meanwhile Spain is in deep recession while booming in broadband.

What is true is that broadband itself is necessary for economic success, and that speeds must keep on rising. It is also true this will mean pushing fiber closer to the home, but it does not necessarily have to go all the way for the foreseeable future. In fact the recent ratification of the HEVC (High Efficiency Video Coding) standard is causing some Telcos that originally decided only fiber all the way to the home would be good enough to deliver HDTV services over their networks to consider now deploying IPTV over their DSL copper infrastructures as well.

The FTTH Council may well have to modify its trenchant promotion of fiber and accept that copper will be part of the mix, following the EU’s decision to slash the €9 billion fund earmarked for the Connecting Europe Facility to just €1 billion. This facility had been earmarked to fund the rollout of super-fast broadband to rural parts of the continent.