Global future of optical fiber looks bright

Lynn Hutcheson, Vice President, Communication Components

Ovum examines the current status and future of fiber. The report highlights that subscribers will nearly quadruple to 108 million by 2012.

At the end of 2007, nearly 29 million subscribers were connected with fiber infrastructure worldwide. Most of the subscribers are receiving service via FTTH (fiber-to-the-home) or FTTB (fiber-to-the-Building). The two terms together are commonly called FTTP (fiber-to-the-premise).

The growth of fiber is expected to continue at a very fast pace with the number of fiber subscribers expected to grow to over 100 million by the end of 2012. Currently, fiber broadband comprises 7.5% of all broadband users and is expected to increase to 16% of all broadband users by 2012.

Two fundamental fiber architectures are being deployed in today's access networks: point-to-multipoint which is commonly referred to as PON (passive optical networks) and point-to-point or P2P, also referred to as active Ethernet.

PON networks have a single fiber that runs from the central office to deep in the network and usually terminates at a splitter cabinet. While the splitter cabinet typically contains a 1x32 splitter, split ratios of 1x16 and 1x8 are sometimes used. New standards are calling for even larger split ratios of 1x64 and 1x128. From the splitter cabinet short runs of fiber connect each of the homes.

In contrast, with the P2P architecture a single fiber runs all the way from the central office to the home.

Both architectures are being deployed, with P2P currently outpacing PON installations. By 2012 PON will catch up to P2P, and it is expected that P2P will start to decline and PON will continue to grow and will dominate.

For densely populated regions of the world, high-rise multi-dwelling units can take advantage of resource sharing through traffic aggregation with a centralized Ethernet switch or digital subscriber line access multiplexer (DSLAM) in each building. In this case, a dedicated single fiber link back to the central office makes a lot of sense. China-India and Asia-Pacific are currently the leading regions for point-to-point access due to their large number of densely populated areas. We expect Western Europe to catch up and surpass Asia-Pacific in the later years.

Worldwide, the PON market is expected to grow at a CAGR of 15% between 2005 and 2012. North America will be more aggressive in its deployment of PON networks during the forecast period, while Asia-Pacific PON deployments will remain relatively steady. The fastest-growing regions for PON sales are forecast to be Western Europe and North America.

There is also movement between different flavours of PON. Starting in 2007, the migration from broadband PON (BPON) to gigabit PON (GPON) in North America began as the pricing of GPON became more attractive. In other places, Ethernet-based PON (EPON) is more popular. Asia-Pacific and China-India will continue to favor EPON, although GPON will make its presence known in the later years of the forecast.

Lynn Hutcheson is Vice President Communication Components at Ovum RHK. Lynn has over 30 years of research, product development and executive management experience in fiber optic technologies, photonics, access networks and HFC systems technologies.