International Telecommunication Union
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Fiber Access Network
A Cable Operator’s Perspective
Mr. John A. Brouse, Jr.
Director of Network Implementation
Charter Communications, Inc.
ITU-T Workshop All Star Network Access
Geneva, 2-4 June 2004
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
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June 2-4, 2004
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Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
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June 2-4, 2004
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Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
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Historical Perspective
ITU-T
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o RF was the Technology of Choice
• Frequency Division Multiplexing easily allows
simultaneous transmissions
• Ubiquitous service achieved through a Tree and Branch
system of cascading RF amplifiers, coaxial cables, and
directional couplers
• Cost to build and operate the network is independent of
service penetration levels
o Network and Product Expansion
• More Homes and More Programming
• Expanding the network footprint increased the number of
actives in cascade
• New product launches required additional RF bandwidth
• Higher frequencies required RF electronics change outs
and re-spacing
• Result was more components, reduced signal quality and
lower reliability
June 2-4, 2004
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Historical Perspective
ITU-T
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o 1988
• Realization that network bandwidth expansion and
footprint expansion hit a technical wall
• Industry move quickly to adapt existing fiber optics
technology to improve RF signal quality and reliability
• First generation RF broadband optics developed and
deployed within 18 months
o First Generation Application
• RF cascade reductions
• Called Fiber Backbone
•
•
•
•
focus was RF performance
minimal fibers used
minimal nodes deployed
maximize number of homes served per node
• Lead to eventual evolution to today’s HFC network
• node serving areas of 500 homes or less
• focus is efficient interactive bandwidth usage
June 2-4, 2004
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
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June 2-4, 2004
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Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
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Current Decision Drivers
ITU-T
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o CASH FLOW
• OSP O&M costs are escalating
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work force costs and benefits
network power costs
fleet operating costs
liability insurance
• Costs to launch advanced products and services are
increasing
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•
June 2-4, 2004
node splitting (internal, external or both)
headend RF splitting/combining network reconfiguration
network power reconfiguration
increased time to launch delays revenues
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
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o
June 2-4, 2004
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Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
8
HFC Model
ITU-T
June 2-4, 2004
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Typical Operating System Characteristics
• 54,000 households passed
• 33,500 customers
• 1410 miles of plant
• 199 fiber nodes
• 4380 RF actives
• 584 power supplies
• 1752 batteries
• 2.5% monthly service call rate
• 50% of the service calls result in a truck roll to resolve plant
related problems
• 2 plant outages per month not related to cut/damaged cable
• 6.0 vehicle accidents per 1,000,000 VMD
• 5.8 OSHA recordable employee injuries per 200,000 hours
worked
• 8 Maintenance Technicians
• 23 Service Technicians
• 3 Technical Field Supervisors
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HFC Model
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ITU-T
Home
Headend
Voice
Switch
Data
Router/
IP Switch
Video
RF
RF
RF
RF
MUX
RF
DFB
RF
Node
RF
RF
P/S
June 2-4, 2004
RF
Coax
RG6
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
o
o
o
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o
o
June 2-4, 2004
n
un
Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
11
FTTH (RF PON) Model
ITU-T
June 2-4, 2004
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Modeled after same Operating System used for the HFC Model
• 54,000 households passed
• 33,500 customers
• 1410 miles of plant
• 0 fiber nodes
• 0 RF actives
• 0 power supplies
• 0 batteries
• 1.25% monthly service call rate
• 0% of the service calls result in a truck roll to resolve plant
related problems
• 0 plant outages per month not related to cut/damaged cable
• 0 vehicle accidents per 1,000,000 VMD
• 0 OSHA recordable employee injuries per 200,000 hours worked
• 0 Maintenance Technicians
• 12 Service Technicians
• 1 Technical Field Supervisors
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FTTH (RF PON) Model
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ITU-T
Home
Headend
Voice
Switch
Data
Router/
IP Switch
Video
RF
RF
RF
RF
RF
MUX
RF
EDFA
S
p
l
i
t
t
e
r
S
p
l
i
t
t
e
r
Optical
Network
Terminal
RF
RF
Coax
RG6
UPS
June 2-4, 2004
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
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o
o
o
o
o
June 2-4, 2004
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Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
14
Comparative Cost Assessment
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HFC O&M Expenses per Mile of Plant
ITU-T
June 2-4, 2004
Technical Supervision
$
42.03
Service Trouble Truck Rolls (for plant problems)
$
226.15
Plant Maintenance Truck Rolls
$
235.50
Material Inventory
$
49.64
Electricity Consumption
$
446.81
Power Supply Battery Replacement
$
43.49
Power Supply Equipment Repair
$
1.77
RF Line Equipment Repair
$
35.46
Vehicle Accident Loss
$
8.80
Employee Injury Loss
$
5.01
Emergency Cable Repair
$
8.51
Total annual O&M expense per mile of OSP plant
$1,103.17
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Comparative Cost Assessment
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FTTH (RF PON) O&M Expenses per Mile of Plant
ITU-T
June 2-4, 2004
Technical Supervision
$
0.00
Service Trouble Truck Rolls (for plant problems)
$
0.00
Plant Maintenance Truck Rolls
$
0.00
Material Inventory
$
0.00
Electricity Consumption
$
0.00
Power Supply Battery Replacement
$
0.00
Power Supply Equipment Repair
$
0.00
RF Line Equipment Repair
$
0.00
Vehicle Accident Loss
$
0.00
Employee Injury Loss
$
0.00
Emergency Cable Repair
$
85.11
Total annual O&M expense per mile of OSP plant
$ 85.11
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Comparative Cost Assessment
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HFC Deployment Costs per Mile of Plant
ITU-T
Outside Plant Deployment
Materials
$ 12,273.93
Labor
$ 16,408.61
Total OSP Deployment Cost per Mile
$ 28,682.54
Headend Equipment Deployment
June 2-4, 2004
Materials
$
736.51
Labor
$
83.50
Total Headend Equipment Deployment Cost per OSP Mile
$
820.02
Total Cost to Deploy HFC (excluding drops & CPE)
$ 29,503.08
Drop Installation (Materials & Labor) per Customer
$
125.00
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Comparative Cost Assessment
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FTTH Deployment Costs per Mile of Plant
ITU-T
Outside Plant Deployment
Materials
$ 16,505.22
Labor
$
Total OSP Deployment Cost per Mile
$ 26,084.01
9,578.79
Headend Equipment Deployment
June 2-4, 2004
Materials
$ 15,910.00
Labor
$
Total Headend Equipment Deployment Cost per OSP Mile
$ 16,118.77
208.76
Total Cost to Deploy HFC (excluding drops & CPE)
$ 42,202.78
Drop Installation (Materials & Labor) per Customer (ONT incl)
$
748.00
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Comparative Cost Assessment
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Life Cycle Cost Comparison
HFC and FTTH (RF PON)
ITU-T
Life-Cycle Cost Analysis
HFC vs FTTH PON
Cost per Mile of Outside Plant
$55,000
$50,000
$45,000
HFC
$40,000
PON
$35,000
$30,000
$25,000
1
2
3
4
5 6
7
8
9 10 11 12 13 14 15 16 17 18 19 20 21
Years in Operation
June 2-4, 2004
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ITU-T
Fiber Access Network
A Cable Operator’s Perspective
o
o
o
o
o
o
June 2-4, 2004
n
un
Historical Perspective
Current Decision Drivers
HFC Model
FTTH Model
Comparative Cost Assessment
Conclusions
20
Conclusions
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ITU-T
o FTTH (RF PON) best addresses the business decision drivers.
o Current FTTH equipment costs place it at a significant
disadvantage.
o Construction costs for the OSP portion of the PON are 9%
lower than HFC OSP deployment; however, the headend
costs are over 16 times more favorable to an HFC approach.
o Best areas to seek cost improvements are in the headend
and CPE.
o Under current price points, the Life Cycle break even point
occurs during year 12.
June 2-4, 2004
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Conclusions
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ITU-T
o Only part of the economic equation has been investigated.
• Future looking cost modeling and comparative analysis need
to be undertaken in order to develop the full scope of costs.
• Transition from RF format to Ethernet for Voice and Data.
• Transition from RF to IP Video.
• Future looking business model comparative analysis needs
to be undertaken to determine cash flow impact of FTTH vs
HFC.
•
•
•
•
June 2-4, 2004
Changes in penetration levels.
Transition from Cable Modems to Ethernet to the Home.
Transition from RF video to IP Video.
Transition to an all IP world.
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Conclusions
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ITU-T
o For the near term, cable operators will continue to
refine the HFC platform with efforts to design out
much of the current O&M costs by driving fiber
closer to the curb – but not to the home.
June 2-4, 2004
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