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Fiber broadband

What Can do For

Your CommunitY

bandwidth • reliability • economic development • future-proofing sustainability • affordability • symmetry • standards-based • security

7th Edition • Summer 2012 A Fiber-To-The-Home Primer from the Editors of

Contents Reliability...

Fiber to the Home: Pathway to New Broadband Services . . . | 3

Bandwidth...

Fiber and Bandwidth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 8

Affordability...

Why We’ll Always Need More Bandwidth . . . . . . . . . . . . . . . . . . | 11

Future-Proofing...

Reducing Health Care Costs Through Telehealth . . . . . . . . . . . | 13

Standards...

FTTH for Communities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 16

FTTH Growth In North America, 2002–2012 . . . . . . . . . . . . . . . . | 6 Fiber: The Light Fantastic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 9 Services: Beyond The Triple Play . . . . . . . . . . . . . . . . . . . . . . . . . . | 12 The Future of Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 15 Questions Municipal Officials Ask About FTTH . . . . . . . . . . . . . | 16

Security...

Planning a Fiber Network? Use the National Broadband Map . . . . . . . . . . . . . . . . . . . . . . . . . . | 19

Economic Development...

FTTH Generates Jobs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 20

New Broadband Content & Services... Higher Revenue...

Introducing 1 Gbps To the Home . . . . . . . . . . . . . . . . . . . . . . . . . | 23 Builders, Real Estate Developers and FTTH . . . . . . . . . . . . . . . . | 24 Questions Real Estate Developers Ask About FTTH . . . . . . . . | 26 Property Developers Beat The Recession With Fiber . . . . . . . | 28 Is It Really Fiber To the Home? . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 29 This primer was originally written by Steven S. Ross and updated by him and by Masha Zager, both of the Broadband Communities staff. It summarizes research commissioned by the FTTH Council as well as independent reporting by the authors and by BBC contributing editor Joe Bousquin.

Fiber-to-the-Home Subscribers Are Satisfied With Their Broadband Service

About the Cover Middle-schoolers in San Carlos, Calif ., participate in a virtual field trip to a museum in Denver . adband Fiber bro munitY Your Com

Photo courtesy

of the San Mateo

What Can do For

Daily Journal.

Sustainability...

FTTH Success Stories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 20

ng t . future-proofi . ic developmen urity s-based sec . reliability . econom . symmetry . standard bandwidth . affordability sustainability

Percent of subscribers satisfied with service Source: RVA LLC

7th Edition

2 • Summer 201

r e-Home Prime A Fiber-To-Th rs of from the Edito

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| What Fiber Broadband Can Do For Your Community | BROADBAND COMMUNITIES | www.bbcmag.com | summer 2012

Fiber to the home: Pathway to New broadband Services

F

iber to the home (FTTH) has become the leading technology for nextgeneration communications networks worldwide . On every continent, telecom providers are building fiber optic networks to replace legacy copper networks . They know that only FTTH can meet the growing demand for broadband services that require delivering video to (and from) multiple tablets, computers and television sets in a home, all at the same time . Because governments often view FTTH as critical national infrastructure, many have developed national broadband plans to encourage it and thus encourage economic growth . The United

Only fiber to the home can meet the growing demand for broadband services. the world – and worldwide, an estimated 80 million households subscribe to fiberbased services, including voice, video, data and more . In the United States, one of every five households is within reach of fiber, and more than 8 million households are using FTTH services now . These numbers continue to grow rapidly . China alone expects to have 100 million fiber subscribers by 2015 . By then, 90 percent of all Australians will be connected .

Who CAN build Ftth NetWorkS? Most of the FTTH connections in the United States come from large telephone companies . Verizon’s FiOS network has captured most of the media attention, and some of AT&T’s U-verse service is also based on FTTH . But that doesn’t tell the whole story . Today, more than 800 companies supply fiber-to-the-home broadband in the United States . Who are they? Most of these companies were in the telecommunications business to begin with – more than 600 are local telephone companies, and others include cable companies and local Internet service providers and wireless ISPs . Larger telcos are deploying fiber in cities and suburbs, and smaller telcos and ISPs in rural areas . Cable providers use fiber to compete for lucrative commercial-services business and in new housing developments . In areas where established telecom providers are not building FTTH, communities are reaching out

States is no exception . The National Broadband Plan calls for 100 Mbps connections to 100 million households . Consumers who subscribe to FTTH consistently rate it as the fastest and most reliable broadband technology . They also appreciate that fiber networks can deliver many unique broadband services for medicine, education, home-based businesses and entertainment . Already, fiber connections are available to more than 200 million homes globally – a tenth of all the households in summer 2012 | www.bbcmag.com | BROADBAND COMMUNITIES | What Fiber Broadband Can Do For Your Community |

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When Google announced that it planned to build one or more community fiber networks, more than 1,100 local governments proposed their communities as suitable locations. to nontraditional providers . Local governments are attracted to FTTH because it positions their communities for tomorrow’s jobs and economic growth . In 2010, when Google announced that it planned to build one or more community fiber networks, more than 1,100 local governments proposed their communities as suitable locations . In some cases, communities build their own networks or collaborate with neighboring communities to do so – there are now about 120 FTTH projects of this kind . (Some of them serve only businesses, not households .) Google, on its way to becoming a new “phone company,” is building a superfast FTTH network in Kansas City, and other nontraditional providers include cooperative electric utilities, property developers and even universities . It makes sense for these forwardlooking organizations to build FTTH

networks . For example, even in a down economy, most developers can enhance the value of their properties by putting fiber into new properties or upgrading existing properties . Some small electric companies built fiber optic networks to manage their own facilities, and they can easily extend these to serve their customers as well .

Ftth iS the oNly uNlimited broAdbANd teChNology Other types of broadband have improved a great deal over the last few years – mostly because providers have brought optical fiber much closer to their customers . Some cable providers use fiber to get close to homes and then employ copper coaxial cable for the last hundred to 1,000 feet . Some phone companies bring fiber to within a few thousand feet of the home and use plain copper wire for the rest of the trip . Fourth-generation wireless broadband, which is being deployed today, usually requires fiber connections at cell sites .

These new hybrid networks are much more powerful than older copper and wireless access networks . But copper and wireless “last miles” still have inherently limited capacity . Tweaking more bandwidth from them becomes increasingly difficult and expensive as time goes on . This isn’t true of optical fiber, whose capacity is effectively unlimited . By 2016, there will be nearly three IPconnected devices per person, according to research by Cisco . Only FTTH can meet this demand for in-home bandwidth .

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Providers and governments around the world all agree that unlocking the potential of broadband requires taking optical fiber all the way to subscribers’ doors. Everyone also agrees that fiber will meet the world’s needs for the foreseeable future . The only debates involve the speed of the transition . The reason for this striking degree of unanimity is simple: FTTH offers far more bandwidth, reliability, flexibility, security and longer economic life than alternative technologies, even though its price is comparable . It is slightly more expensive to build, but it is far less expensive to operate and maintain than copper . Fiber can handle any bandwidth demand with ease . In fact, one bundle of fiber cable not much thicker than a pencil can carry all of the world’s current communications traffic . The technologies for transmitting data over fiber are well understood, and the upgrade path for the electronic components that send and receive signals has been defined for years into the future . If anything, increasing fiber bandwidth will become less expensive rather than more expensive . the PAyoFF For ProviderS FTTH providers can enjoy much greater revenue than traditional broadband providers . FTTH subscribers today often spend 30 to 40 percent more per month than DSL subscribers – not because basic services are more expensive (they aren’t) but because more and better premium services are available . For example, multiple simultaneous HD channels are difficult to implement well over any medium but fiber; 3D TV and high-definition video communications are even more challenging . Taking pay-TV services on the road (true TV Everywhere) requires high upstream bandwidth at home . Home energy management services benefit from fiber’s high reliability . Businesses are also willing to pay for new services, including emerging services such as cloud computing and

Because copper and wireless have inherently limited capacity, tweaking more bandwidth from them becomes increasingly difficult and expensive as time goes on. This isn’t true of optical fiber, whose capacity is effectively unlimited. Internet-based backup, storage and business continuity solutions . Added vAlue For ProPertieS ANd CommuNitieS Access to utilities makes private property more valuable . A house is worth much more if it has access to a public street, water and sewer services, public schools and other utilities . In the same way, FTTH adds value to properties . Fiber connections make single-family homes easier to sell and multiple dwelling units easier to rent . Renters and buyers know they can get the most attractive services available on the market today – and that if an exciting new service is introduced in a few years, they’ll be prepared for that as well . Communities also benefit from FTTH in ways that don’t always accrue to

telecom providers . They become more attractive as locations for people to live and do business . They have an advantage in attracting everything from advanced manufacturing to contact centers to data centers . They can nurture the tech startups and home-based businesses that will provide tomorrow’s jobs . They can provide better education and health care for residents, deliver government services more efficiently and engage citizens in government . This publication explores these issues, and more, in detail . It’s written in nontechnical language so you can understand the value of next-generation infrastructure – and what it means to you – without a degree in optical engineering . We want to communicate . . . the Advantages of Fiber to the home. v

Telepresence is one of the advanced applications that depends on a high-bandwidth, highreliability network . In this photo, the people on the far side of the table are actually sitting in a remote office, but can interact with the local group as if they were physically present .

summer 2012 | www.bbcmag.com | BROADBAND COMMUNITIES | What Fiber Broadband Can Do For Your Community |

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Ftth growth in North America, 2002–2012 More than one of every five homes in North America is now passed by fiber . That means fiber comes close enough for the home to be connected to an FTTH network .

FTTH Homes Passed, March 2012 22,600,000 20,000,000

15,000,000

10,000,000

5,000,000

0 Mar-02

Mar-03

Mar-04

Mar-05

Mar-06

Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Mar-12

Source: RVA LLC

More than 8 million households subscribe to fiber-to-the-home services and can receive the best bandwidth and reliability available .

FTTH Homes Connected, March 2012 (Cumulative, North America)

8,000,000

8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 Mar-02

Mar-03

Mar-04

Mar-05

Mar-06

Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Mar-12

Source: RVA LLC

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The pace of FTTH deployment peaked in 2008 – the first year of the recession – but remains strong and even rose in the latest 6-month period . (No FTTH video data is available for the most recent 6-month period .)

Homes Passed, Marketed, and Connected in Each Six-Month Period Since March 2007 (Calculated by BBC from RVA Data)

Passed

2,500,000

Marketed

Connected

Video Connected

2,000,000 1,500,000 1,000,000 500,000 0 Mar-07

Sep-07

Mar-08

Sep-08

Mar-09

FTTH take rate – the ratio of subscribers to households that have the option of purchasing services – continues to rise . Verizon’s FiOS network, which marketed services faster than it could connect customers, has dragged down the average . Rural network

Sep-09

Mar-10

Sep-10

Mar-11

Sep-11

Mar-12

builders and those that serve large apartment complexes and planned-unit developments typically get take rates above 50 percent . In the six months ending March 2012, net customer additions exceeded 55 percent of net new homes marketed .

Take Rate (Customers Connected, Divided by Customers Marketed)

45.0%

41.7%

40.0% 35.0% 30.0% 25.0% 20.0% 15.0% Mar-06

Sep-06

Mar-07

Sep-07

Mar-08

Sep-08

Mar-09

Sep-09

Mar-10

Sep-10

Mar-11

Sep-11

Mar-12


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Fiber and bandwidth Q: What is bandwidth? A: In a network, bandwidth (what engineers call bitrate) is the ability to carry information . The more bandwidth a network has, the more information it can carry in a given amount of time . Networks with high bandwidth also tend to be more reliable because fewer bottlenecks disturb the flow of information . Q: How much bandwidth – or information delivered by bandwidth – do we need? A: The amount of bandwidth we need grows every year . The biggest growth has been for video – traditional pay TV, “over the top” or Internet-based video, and video communications . This trend is expected to continue at least for the rest of this decade . Video requires not only extra bandwidth but also extra reliability . The smallest delay in data transmission can result in distorted views . More video is available than ever before, and people are watching video on more screens at once . In addition, video formats are becoming more bandwidthintensive . HDTV can require as much as 8 megabits per second (Mbps) for fast

Copper can support high bandwidth for only a few hundred yards. The longer a signal travels on copper, the lower the bandwidth falls. action, such as in sporting events, even with new compression technology . A high-quality 3D experience requires about 5 Mbps minimum . 3D immersive HDTV –already used in some academic and industrial settings for telepresence – requires between 50 and 300 Mbps, depending on screen size (some screens cover an entire wall) . Q: What about other kinds of data? A: Bandwidth requirements for many kinds of data are exploding . For example, new digital cameras can create larger and larger images; 30 megabytes is not uncommon . In health care, the medical images produced by equipment such as CT scanners are a hundred times larger than camera images, and more . In the last few years, business and

DSL Bandwidth Declines with Distance from Fiber Node 200

VDSL2 With Vectoring

Mbps

150 100 50 0 0

500

1000

1500

Feet from Fiber Node

2000

2500

3000

Source: Huawei

The bandwidth of a DSL signal declines with distance from the fiber node . VDSL2, the most advanced form of DSL, can deliver about 30 Mbps at 3,000 feet, depending on the quality of the copper . A new technology called node-scale vectoring promises to increase DSL bandwidth – again, only if the copper is in good condition .

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science both entered the era of “Big Data” applications that collect and analyze data on massive scales . Today’s Big Data applications range from consumer pricing models to DNA sequencing to particle physics to control of electrical grids . Big Data doesn’t work without Big Bandwidth . Q: Can’t copper carry high bandwidth? A: Copper’s capacity is far less than fiber’s . It can support high bandwidth for only a few hundred yards . The longer a signal travels on copper, the lower the bandwidth falls . Optical fiber is unique in that it can carry high-bandwidth signals over enormous distances . Fiber uses laser light to carry signals . Under some circumstances, a signal can travel 40 miles (60 kilometers) without degrading enough to keep it from being received . Fiber is also better able to support upstream bandwidth – that is, from the user out to the network . High upstream bandwidth is important for video communication and for many business applications . Q: What about wireless? i hear it can provide 54 mbps. A: That’s the potential bandwidth shared by all users connected to a cellular antenna site . Wireless broadband depends on fiber to move information to and from cell towers . And even so, each antenna can support only a finite number of cellular signals . Cellular data traffic grew 200-fold from 2006 to 2012 and will grow another eightfold by 2015 . Providers are now severely limiting wireless data and are encouraging


Fiber: The Light Fantastic

F

3

1

5

iber optic cable is made up of thin strands of glass that carry information by transmitting pulses of light, usually created by lasers. (Copper cable, by contrast, carries low-voltage electrical signals.) The pulses are turned on and off very, very quickly. A single fiber can carry multiple streams of information at the same time over different wavelengths, or colors, of light. Fiber has many advantages over copper wire or coaxial cable: Signals travel long distances inside fiber cable without degradation – 40 miles or more in some real-world networks and 65 miles or more in the laboratory.

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Fiber cable is thin and flexible. An individual fiber can be thinner than a human hair. Thin fibers can be packaged in a narrow ribbon or inside a hollow plastic microduct less than 1/8

inch in diameter. Fiber cable can be hidden easily on the surfaces of walls in old construction. Once installed, fiber is upgraded by changing the electronics that create and receive the light pulses, not by replacing the cable itself.

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Fiber cable has a longer life than copper because it does not corrode, is not easily affected by water and generates no heat. It isn’t damaged by lightning. Nothing hurts it except a physical cut or the destruction of the building it is in. Fiber networks cost less to operate than copper. The most common type of FTTH network uses no electronics – and therefore no power – between the provider’s central office and users, which minimizes operating costs. Even optical networks that do require electronics in the field use far less power than coax or other copper networks.

or forcing customers to use Wi-Fi connections for data instead of cellular networks. Those Wi-Fi connections, in turn, work best when they can quickly offload data to a fiber network.

optic cable, delivering services reliably and inexpensively. The first time fiber delivered a signal directly to an American home (in Hunter’s Creek, Fla.) was more than 20 years ago.

Q: What exactly makes fiber “future proof”? A: The equipment used to send light signals over glass fiber keeps getting better. So equipping an existing fiber network with new electronics and with lasers that pulse light faster, or lasers that use different wavelengths of light, can vastly increase available bandwidth without changing the fiber itself. New electronics are very cheap compared with the original cost of laying the fiber. Therefore, once fiber has been deployed, network operators can keep increasing bandwidth at very little cost.

Q: All providers seem to claim they have fiber networks. What’s different about fiber to the home? A: Don’t be fooled! It is true that most cable and DSL networks use some fiber. In these networks, the fiber carries the signal close enough to homes so that copper can carry it the rest of the way. However, this approach requires expensive, difficult-to-maintain electronics at the point where fiber meets copper. The available bandwidth is far less than an all-fiber network. And these halfway approaches do not allow symmetrical bandwidth – cable and DSL systems can’t upload information as fast as they can download it.

Q: How long has fiber optic technology been in use? A: Fiber optic cable is the foundation of the world’s telecommunications system. It has been used for more than 30 years to carry communications traffic from city to city and from country to country. Almost every country has some fiber

Q: Isn’t that good enough? A: It’s not good enough to make your community competitive or support a tech-savvy home-based business. Today’s cable modems and DSL lines may suffice for consumers to send emails, download

songs or share family photos. If you want to log on to the corporate LAN from home and work effectively, you’ll need more. And what about uploading a highdef video of the school play, or sitting down to dinner with family members a thousand miles away? Q: Why does it matter how close to the home fiber comes in DSL and cable systems? A: With copper cable, bandwidth drops precipitously with distance. For example, the latest commercial versions of DSL can carry a signal of more than 150 Mbps for about 750 feet. Over a half-mile, today’s DSL can deliver only about 30 Mbps. In practice, the real bandwidth is less. As often happens with fading technologies, a huge effort is being made to squeeze as much as possible out of past investments in copper. The most recent expedient, vectored DSL, is just beginning to appear. It allows 50 Mbps downstream signals for as far as 2,000 feet under ideal conditions. It won’t work on very old copper wiring, upstream bandwidth is limited, and it requires expensive electronics in the field. But it is


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only when compared with not building

Well-designed fiber networks don’t slow down when teenagers come home from school. Customers should always get advertised speeds.

a new network – that is, with making minor tweaks to an existing copper network . The problem is that these less-expensive solutions don’t meet users’ needs . In the last few years, the flood of video content has outrun the

being touted as an interim solution when network builders cannot afford FTTH . Q: With cable and DSL, there’s often a gap between advertised and actual bandwidth. Is that true for fiber? A: No . Cable, DSL and even wireless networks are usually heavily oversubscribed – that is, providers promise users more than the total amount of available bandwidth because they know all users aren’t going full throttle most of the time . As a result, they slow down during periods of heavy use, such as when teenagers come home

from school . Fiber has enough bandwidth that providers can guarantee high speeds with little or no oversubscription . If a fiber network is designed properly, users will always get the speeds that are advertised . The Federal Communications Commission now insists that carriers deliver the bandwidth they advertise .

ability of older copper technologies to

Q: Is FTTH technology expensive? A: In new construction, fiber costs about the same as copper to build, and it costs much less to operate and maintain . Building fiber to the home is expensive

services they have paid for . In addition,

handle bandwidth demands . Providers are shutting off or slowing down service or imposing prohibitive fees for customers who exceed monthly bandwidth caps . Customers don’t like these restrictions, and they don’t appreciate being called “bandwidth hogs” for using it’s not clear that providers save money by failing to meet users’ needs, because limiting bandwidth means limiting revenue potential as well . v

1+

uSe

10

64 kbps: Phone line 128 kbps: iSdN 1.5 mbps for a t1 line

20 mbps: Wireless maximum per user with latest technology

100 mbps: dSl maximum per user with latest technology

only the beginning In a few years, even 1 Gbps will look small . Soon, most content will be 3D and ultrahigh-definition .

160 mbps: Cable maximum per user with latest technology

1+ gb uS er PS F ib ,A e N (20 d gr r Pe 1 2) oW r iN g

er r P iNg e b W i S F gro P ) d gb AN 012 1+ er, (2 uS

Today, fiber’s bandwidth is orders of magnitude bigger than other technologies . As the new generation of 10 Gbps equipment is deployed, the fiber circle will move off the page .

Bandwidth Comparisons

Per er iNg F i b oW PS gr gb Nd ) 1+ r, A 2012 ( e uS

gb r, A P S F i be Nd (20 gro r Pe r 12 W ) iN g

hoW big iS A gig?


Why We’ll Always Need more bandwidth

i

n a century of telephone communications, the bandwidth on voice channels changed very little – yet Internet bandwidth needs grow exponentially . That’s because, on the Internet, bandwidth drives innovation, and innovation drives demand for more bandwidth . The real value of increased bandwidth is not that it lets us send email faster, but that it lets us do entirely new things . In the past few years, we have seen such dazzling innovations as •

•

•

Tablet computers for easy access to games, ebooks, TV programs, email, shopping, banking and an everexpanding suite of new “apps .” Smartphones that aren’t just for mobility but are increasingly used for personal media consumption at home . Internet-connected televisions, radios, set-top boxes, Blu-ray Disc players, cameras and picture frames that receive or deliver movies, TV and photos via the Web . Users don’t have to “think Internet” to

vation – ters drive inno Tablet compu d . deman and bandwidth

•

•

•

•

put Internet video on the TV . They just check out what’s available, using their TV remotes or tablet computers . Internet-capable TV models are today’s standard offering . Voice over Internet Protocol (VoIP) telephones that direct incoming callers to any line and take messages in text and video as well as voice . Social media that keeps people continuously in touch and up to date – who needs phone calls anymore? Two-way video communication whose quality is good enough to bring the illusion of “being there” to teleconferencing . It’s called telepresence . High-definition video communication has even reached the home market; telecommuting workers can send telepresence robots in their offices to sit in for them at meetings while they watch from their home TVs . Easy distribution of user-created video that lets grandparents see children, musicians develop

•

audiences and manufacturers demonstrate new products . Digital media lockers that let consumers store music, TV, videos and services on a central server and access them from many devices .

Entertainment and social life aren’t all that have changed . People can access health care and take classes from home, and they can take care of their homes while they’re away, using Internetconnected security cameras and remote energy-monitoring devices . As these services become more widely known and available, more people will demand access to them . Telecommuting and home-based businesses are on the rise, too . In October 2010, market researcher Michael Render reported that new businesses created by fiber-connected residential users had pumped more than $40 billion into the economy in just the previous 12 months, the largest source of new jobs in 2010 . Now, home-based businesses continue to add more employment than any other category . Many owners of home-based businesses say they could not operate without fiber to the home, and telecommuters say their employers would be less likely to let them work from home without fast, reliable fiber broadband . There appears to be a pent-up demand for working from home at least part-time – in a recent survey of federal employees, 93 percent said they valued the option to telecommute . There is every reason to believe that innovation will continue, that bandwidth needs will keep on growing – and that only fiber to the home, with its superior reliability and plentiful upstream capacity, will be able to keep delivering the necessary bandwidth . v


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Services: Beyond the triple Play

A

decade ago, cable companies introduced the triple play of voice, video and data that is now the standard telecom offering worldwide. Fiber’s greater bandwidth and reliability allow FTTH providers to think beyond the triple play and offer services tailored to communities’ needs. Some of these services help differentiate fiber-to-the-home communities; some generate additional revenue streams or help retain customers; still others can be used by providers or property developers to manage their assets more efficiently. Many do all three.

Get Your CommunitY notiCed telehealth allows instant access to medical specialists via videoconferencing from a home or community center. The videoconferencing may be integrated with Internet-enabled diagnostic devices (blood pressure cuffs, respiration measurement, etc.), electronic medical records systems, online prescription services and online appointment

El

12

t up to trans ectric meter se

mit smar t-grid

The services that fiber to the home supports can make your community a more appealing place to live, allow efficient asset management and generate new revenues for the deployer. scheduling. Telehealth helps keep older adults living independently for longer, and it is a boon for members of the “sandwich generation,” who are responsible for caring for both their children and their elders. Social applications help build a sense of community. They range from community-focused social networking sites to intranet sites that feature local news and events to video channels that broadcast local athletic contests, artistic productions and political discussions. Because these offerings can be interactive, they easily trump conventional cable public-access stations. Home-automation and concierge services make residents’ lives

information.

comfortable and convenient. Cameras that recognize cars when they enter a community can alert parking attendants and security personnel and then turn on lights and heating or air conditioning at home. Residents can connect with one click to community services or schedule a dry-cleaning pickup, pizza delivery or home repair. These applications also help owners control energy use. mobility is easier to accommodate with a robust fiber-to-the-home network. Using the backhaul afforded by FTTH, providers can offer Wi-Fi connections to residents in indoor and outdoor public spaces throughout a community. Residents can bring their laptops or tablets to a pool, check email from a laundry room or listen to Internet radio in a gym. Add new revenue StreAmS Because fiber-to-the-home networks have virtually unlimited capacity, unparalleled reliability and remote service monitoring, fiber providers have a wide choice of applications for resale. the smart electric grid is expected to radically improve the business case for fiber to the home. Connecting electric meters to fiber enables automated meter reading. This is usually the first smart-grid application that utilities deploy because it is relatively straightforward to implement and has an immediate payback. Though most FTTH deployers that have installed smart meters are either public or


cooperative electric utilities, a few telcos install and read smart meters and charge utilities on a per-reading basis . Beyond automated meter reading, such smart-grid applications as demandresponse programs, SCADA and outage investigation greatly reduce electric utilities’ operating costs . Smart-grid applications are major reasons that electric utilities across the country have long been building fiber infrastructures . mobile backhaul is another enormous revenue opportunity for fiber deployers . The exploding demands for mobile bandwidth are prompting wireless providers to upgrade the connections from their cell sites to the Internet (traditional connections are usually copper T1 lines with 1 .5 Mbps bandwidth) . About one cell site in four is now served by fiber, and more are added every day . In addition, the next generation of wireless architecture will move all baseband processing from cell sites to the cloud; cell sites will have to be connected via fiber to hubs where processing takes place . Broadband providers offer many other applications through Web portals or set-top boxes, often at lower prices than customers could obtain by purchasing these services directly . In addition to creating new revenue streams, these applications reduce customer churn, and they lower expenses by keeping more traffic in-network . online storage allows users to store data files on the Internet, access them from anywhere and share them with others . The cloud computing revolution has moved applications and even computing capacity from the desktop to the Web . Service providers now supply managed services to business customers, such as business continuity, that until

reducing health Care Costs through telehealth

F

iber is the technology of choice for in-hospital networks and for consultations with off-site specialists . Until recently, however, regulatory requirements limited the opportunities for using broadband to substitute live-at-home options for costly nursing home care . A recent study in Philadelphia suggests that these savings are too large to ignore . NewCourtland, a senior services provider in Philadelphia, operates the LIFE program, modeled on the Medicare/ Medicaid Program of AllInclusive Care for the Elderly (PACE) initiative . PACE serves individuals age 55 or older who are certified to need nursing home care, are able to live safely in the community and reside in a PACE service area . Ninety-five providers in 31 states received Medicare and Medicaid waivers to operate PACE programs . Although all PACE participants are certified to need nursing home care, the program keeps 93 percent of participants living safely in the community . PACE providers deliver all needed medical and supportive services, including adult day care, medical care, drugs, social services, medical specialists, and hospital and nursing home care when they become necessary . By employing remote monitoring technology, NewCourtland enabled 33 residents to move from traditional nursing home care, realizing an annual savings of more than $1 .8 million . Essentially, the technology

helped substitute a $125 per month technology cost per person for $225 per day in nursing home costs, starting in 2008 . Seven of the patients were in a group home, and 26 lived separately . Instead of staffing the patients’ homes with live-in help, NewCourtland installed a Healthsense eNeighbor system that included sensors placed around the home, biometric devices, medication dispensing and a check-in button in each home . Any unwarranted change brings a call from the monitoring center and, if necessary, a response from nearby staff . In a group home, there is one caregiver, supplemented with regular extra support mornings and evenings . “Keeping even one person out of the hospital can pay for all systems for a PACE program for a year,” said Jim Reilly, Director of Courtland Health Technology . “And more important, the individuals we helped were motivated to leave a nursing home and move into the community, making the extra effort to participate in rehab .” Inside each patient’s living unit, all equipment is connected by Wi-Fi to a network gateway . Fiber providers, whose networks rarely suffer outages that require on-premises gateway resets, have a huge advantage over DSL or cable providers in supporting programs like this one . The NewCourtland program could be copied by many local network providers under current regulations . Verizon has now adopted this approach and is offering HealthSense to its FiOS MDU customers .


13

Critical services that must be available all the time – such as medical monitoring and fire protection – benefit from the extra reliability of fiber broadband. recently were provided only by corporate IT departments . home security, like many other technologies, is migrating from analog to digital . Digitally based home security allows residents to control settings, receive alerts and view their homes via a PC or cellphone . Digital security systems also support a wider range of sensors – not only traditional motion detectors but also cameras, water detectors, smoke detectors and many others . Because digital security uses wiring that is already installed for broadband, it is inexpensive to install and makes economic sense for renters as well as homeowners . over-the-top video (delivered on the data service, not the video service) may be offered as either an adjunct to or a substitute for traditional pay TV, and it may be delivered either through a Web portal or a set-top box . The business models, technologies and legal status of provider-delivered OTT video are evolving rapidly – a fact that demonstrates the enormous amount of interest in this application . If OTT video eventually displaces traditional pay TV,

fiber-to-the-home providers are wellpositioned to benefit because they can guarantee the quality of user experience . videoconferencing or video chat is universally available through free or low-cost Web-based services, but the quality of low-end services is often poor . Fiber to the home, with its high upstream bandwidth, presents opportunities for providers to make high-quality videoconferencing available through TV screens . targeted advertising represents an important potential revenue stream . IPTV ads can be sent to households or specific TVs based on demographic criteria or viewing patterns . Another potential source of advertising dollars is T-commerce, in which television viewers click on ads - or even product placements in television shows - to see more information about products or order them . mANAge ASSetS more eFFiCieNtly Broadband enables property owners to manage their assets efficiently . The addition of broadband – especially

Rural telco BEK brings local sports events to its video customers; this is the mobile studio .

14

the high-capacity, high-reliability broadband that fiber enables – turns “smart” buildings into “genius” buildings . Internet-enabled sensors and applications automate work that was once done by maintenance crews – and get it done it more quickly and accurately . Broadband applications also help owners communicate with tenants and employees . Guarding buildings and construction sites can be managed inexpensively and intelligently through IP-based video surveillance . Videoconferencing allows construction managers to make virtual site inspections more frequently than they can make physical inspections . Online work order scheduling helps property managers be more responsive to their residents while reducing operating expenses . Residents can request repairs at any time – not just when the office is open or they can find the superintendent – and management personnel can deal with problems that require personal attention rather than routine requests . Residents can be automatically notified when work is completed . Proprietary building management networks, such as fire protection systems, can be replaced by standards-based systems that are less expensive . Energy management and water management can be broadband-enabled . Motion sensors, intelligent thermostats and automated ventilation equipment can keep public spaces and unoccupied units at appropriate temperatures; applications that monitor and analyze usage help property managers and residents find opportunities to shift loads to nonpeak times and reduce their overall usage . v


The Future of Education

M

ost schools now have Internet access, thanks to the federal E-Rate program, but adequate school broadband is still rare. Fiber-connected schools, however, can enhance students’ educational opportunities. For example, the Forsyth County school district in Georgia uses a business Ethernet connection from Comcast to support streaming video, interactive whiteboards, mobile devices and digital content. The school system ensures that each of its 38,000 students makes use of the high-speed connectivity. The district is putting into place a next-generation learning system to provide individualized, technologybased learning plans based on students’ needs, preferences and performance. The system takes into account learning interests and learning style to increase student engagement and boost their academic performance. Students can learn at home on their own or at school, using high-speed Internet connections, and be rewarded by their teachers in collaborative settings.

“Every time you increase the speed of the network, you are enabling incredible educational opportunities.” – Bailey Mitchell, CTO and CIO, Forsyth County (Ga.) Schools Initiatives such as Bring Your Own Technology (BYOT) and the NOBLE Virtual World project also help engage Forsyth County students in new ways. With BYOT growing at a rate of 80 percent, students use their individual Internet-capable tablets, laptops, netbooks and cellphones to work in classrooms in the ways that best suit them. The NOBLE Virtual World project lets students interact with each other in a digitally created world, where anything they imagine can be created. Students develop creativity, data analysis skills and problem solving skills by working in teams and creating plans and solutions for their projects. Increased educational outcomes aren’t the system’s only benefits. Forsyth

County Schools has been able to reduce its textbook costs by about 85 percent by using interactive online content, including streaming video, simulations and other digital resources. The administrative offices also benefit from fast and efficient data transmission, as well as file sharing and document storage via the district’s central server. “Bandwidth is the key. The only way to have access to all that digital content is to connect the technology and infrastructure in support of it,” said Bailey Mitchell, chief technology and information officer for Forsyth County Schools. “My view is that every time you increase the speed of the network, you are enabling incredible educational opportunities.” Another educational innovation taking hold in districts with superior broadband capabilities is the “flipped classroom.” Teachers record lessons as videos on YouTube or similar sites, and sudents study the lessons at home, pausing and replaying parts they find difficult. In school, students solve problems based on the previous night’s lesson and get individual help from teachers. v

Students using computers at a school library in Rocksprings, Texas, on the day they became available. Library director Lisa Scroggins says the boys immediately told all their friends about the computers, and usage jumped quickly. Photo courtesy of Texas State Library and Archives Commission.


15

Ftth for Communities

b

y spring 2012, the number of public and publicprivate fiber networks reached about 120, with several new projects enabled by broadband stimulus funding . Many communities are expanding networks they started building in earlier years, also thanks in part to stimulus funding . And then there is Google’s plan for partnering with municipalities on 1 Gbps fiber, starting with a build under way

in Kansas City, Kan ., and Kansas City, Mo . All this activity has made municipal officials keenly aware of the potential for using ultra-broadband to promote economic development and enhance the quality of life in their communities . They are looking for new ways to encourage private providers to build FTTH networks, new partnership arrangements with telecom providers and ways to leverage such municipal assets as conduit, utility poles and existing fiber .

Questions municipal officials Ask About Ftth Q: Isn’t Wi-Fi or 4G cellular service a good substitute for fiber? The National Broadband Plan calls for wireless in remote areas. A: Wireless services are important public amenities, but they are not substitutes or replacements for FTTH . Rather, they

FTTH is only one part of an economic development program – but it’s a vitally important part. Evidence shows fiber broadband helps attract, retain and grow businesses.

complement and extend fixed fiber networks . Many wireless access points and cell sites are already fiber-connected, and most of them will be soon . Wireless service can thus be considered an application on a fiber network rather than a separate type of network . Wireless access alone cannot attract new businesses to a community or enable businesses to grow . Wireless networks that cover wide areas are not reliable enough to deliver video and

Q: Don’t cable companies (with DOCSIS

needs of the business community in

3.0) and telephone companies (with

addition to those of residents – many

FTTN plus DSL) both use fiber?

economic development officials believe

A: They use fiber, but usually not all the

1 Gbps access is needed to lure new

way to the home . The last 1,000 to 5,000

businesses to a town . Finally, be aware

feet from the fiber’s endpoint to the

that significant broadband upgrades are

home is copper – coaxial cable in the

not feasible in many smaller communities

case of DOCSIS, plain copper wire for

whose infrastructure has not been kept

FTTN . That limits bandwidth, reliability

up to date .

and versatility .

Q: Can a fiber network help bring new

other emerging broadband services

Q: Is my community underserved? Most

business into my community?

with high quality of service . Wi-Fi is

residents have some broadband access,

A: There’s quite a bit of evidence that

highly desirable in targeted areas

and the incumbent operators plan to

fiber connectivity encourages businesses

such as commercial shopping streets

upgrade their networks in a few years.

to stay, allows businesses to grow and

and the common areas of multifamily

A: . Even with upgrades, your non-fiber

attracts new businesses, particularly in

communities, but no one has been able

network won’t be able to handle the

high-tech industries . FTTH also facilitates

to develop a compelling business case for

ever-increasing bandwidth demands

home-based start-up businesses and

a municipalitywide Wi-Fi network .

placed on it . Be sure to consider the

helps workers telecommute . Finally, it

16


Pulaski Electric System, a municipal electric utility in Pulaski, Tenn., uses its FTTH network to operate a smart electric grid and deliver triple-play services to residents.

makes a community a more attractive place to live – especially for young people – which can stem the population loss that many small communities experience. FTTH is only one component of an overall economic development strategy – but a vitally important one. Q: My town’s residents are just like others in the region, and maybe have even slightly higher incomes. Why don’t the phone and cable companies consider them attractive customers for FTTH? A: Many cable companies, telephone companies and independent broadband providers are now installing FTTH. But the companies operating in your town may have prioritized other service areas that offer them more geographical or demographic advantages. Or, they may

not have access to the capital needed upfront to expand their services. Q: The telephone company that operates here is installing FTTH in the new development just 10 miles up the road. Why not here? A: Installing fiber in new developments is usually easier than installing it in existing neighborhoods. The fiber goes into the same trenches that have to be dug anyway for water, electricity and sewer service. In fact, copper wiring usually can’t be run that way, so fiber is usually cheaper. Also, the new residents are not already tied to a cable or phone provider, so whoever installs an FTTH network in a new community has an easier time signing up customers. That’s why most new, large housing developments are

Start preparing for fiber now by adding underground ducts whenever you or a utility repair a street or open it for excavation. You can also give others the opportunity to install ducts.

being equipped with fiber. Q: Would installing fiber require that my streets be dug up? A: It depends. Many network builders in North America use aerial fiber installed on poles along with existing telephone, electric and cable wiring. Where trenching is impractical, contractors can often use horizontal drilling or pull fiber through existing ducts, water pipes, sewers and gas lines rather than digging up streets and sidewalks. In addition, many cities already have usable fiber under their streets – fiber that is not being used to its limit. Finally, when there is no good alternative to trenching, new microtrenching techniques may allow it to be done with less disruption to traffic. A deep groove is cut quickly into the pavement with a large circular saw on wheels, and fiber is laid into the groove. One key move: Start preparing for fiber now by adding underground ducts whenever you or a utility repair a street or open it to excavation. You can also adopt an “open trench” policy that gives telecom providers the opportunity to install ducts any time a street is opened.


17

Q: How can I get fiber to my residents without building my own network? My town has too much debt now to borrow more, and we have no experience operating a municipal utility. A: You might try lobbying the incumbents – the cable and telephone companies serving your town now . You could offer such incentives as a reduced franchise fee, access to public property or an accelerated permitting process . If you own an institutional fiber ring that connects municipal buildings, schools and libraries, you might be able to propose fiber swaps . In addition, some communities launch educational campaigns about the value of FTTH and encourage residents to commit to taking fiber services if and when a provider offers them . Another tactic is to invite outside companies to bring FTTH to your residents and offer the same kinds of incentives described above . Or you could enter into a public-private partnership to build a fiber network jointly with a private partner . In Europe, such partnerships are common, and the approach has begun to gain traction in the United States . A variety of different arrangements between the public and private parties are being used . When Google proposed in 2010 to build an FTTH network in one or more American communities, more than 1,100 communities responded with proposals for how they could work together with the company . Last year, a group of university communities banded together to invite both incumbent and competitive providers (as well as nontraditional providers) to build advanced networks . This project, called Gig .U, is already starting to show results .

A municipality can offer many incentives to a private telecom provider – either an incumbent or a competitive overbuilder – to help make building an FTTH network viable for the provider. bandwidth to a potentially unlimited number of service and content providers, are more common in Europe and Asia than in the United States . However, they have succeeded here as well . At present, open-access networks in the United States tend to be either municipal networks or networks built by companies that specialize in bringing fiber to new buildings and subdivisions . Municipal utilities sometimes prefer to provide services directly, at least at the outset, for two reasons: First, it gives them more control over the quality of user experience on their networks, and second, they may have difficulty attracting third-party service providers to start-up networks . The downside of a closed network, however, is that there is less variety in content and services . Many public broadband advocates believe that

opening networks to innovative service providers is the best way to maximize the networks’ value for their communities . Networks built with broadband stimulus funds must allow open access . Q: Where can I go to find out more? A: The FTTH Council (www .ftthcouncil . org) holds quarterly meetings and monthly webinars and offers other information for fiber deployers . Broadband Communities’ municipal portal, www .munibroadband .com, can direct you to additional resources, and its FTTH deployment database at www .fiberville .com shows all FTTH deployments by municipalities and others, including small telephone companies . The National Broadband Map (www . broadbandmap .gov) can provide data about the speed and availability of broadband in your area . v

Danville, Va .’s use of its own utility poles for the nD anville networ k saved the cit y time an d money .

Q: Is it better for the same company to run the network and provide services, or should we consider an open-access network with multiple providers? A: Both methods have been successful . Open-access networks, in which the public or private network builder “rents”

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Planning a Fiber Network? use the National broadband map.

t

he new National Broadband Map – a continuing,

• •

nationwide collection of broadband availability and

•

usage (www .broadbandmap .

gov) – can help communities deploy FTTH networks where they are most needed and use them to best advantage . Though the data are still being refined, the map has already been used by:

• •

industry to site new facilities . Service providers to target new opportunities . municipalities to monitor broadband adoption . Native American tribal authorities to reveal broadband training needs . Policymakers to target broadband grants .

As these maps show, denser populations are better-served with

broadband . Other variables are significant, too – for example, national data suggests that education is key in acceptance of broadband services . One of the maps shows educational levels in the Kansas City area . It would be easy for a private cable operator to target buildings in areas with high educational levels … except that Google is building a 1 Gbps network throughout the whole community!

v


19

FTTh generates Jobs

s

even hundred thousand FTTH subscribers operated home-based businesses in 2010, adding $41.6 billion to the U.S. economy in the 12 months ending August 2010 – about $10 billion of which would have been lost if fiber connections had not been available. To place these figures (conservative estimates by market research firm RVA) in context, 700,000 jobs are more than the entire U.S. economy created in 2010! FTTH access is strongly associated with home businesses, according to RVA data. Doubling the download bitrate of

broadband services adds 0.5 percent to the number of broadband customers with a home business. Small businesses also depend on broadband reliability and on upstream speed – both metrics where fiber vastly outpaces other broadband technologies. Larger businesses, too, benefit from fiber connections. In a 2011 Comcast survey, more than three-quarters of commercial building owners and managers said access to advanced telecommunications services was an important selling tool for them. In highrise ofﬁce buildings, access to advanced communications was the third most

important selling point; for the largest property owners, it was tied with location for the most important selling point. Surveys of economic development professionals suggest that businesses often stay where they are even if broadband service is less than optimal – though, of course, they may miss opportunities to grow and thrive. But a business that has to move looks for a location with fast, reliable, affordable broadband – preferably at least 1 Gbps. Thus, communities and commercial buildings without excellent broadband service have difficulty competing for new business.

FTTh success stories

T

he reliability, bandwidth and future-proofing of fiber to the premises creates new jobs and preserves old ones. A few examples:

ElEuTian Brings Esl BusinEss To Wyoming ToWns Eleutian Technology partners with CDI Holdings of South Korea, a market leader in English education, to teach conversational English to South Korean students via high-speed videoconferencing. Headquartered in rural Ten Sleep, Wyo., Eleutian has gone on to partner with Chinese ministries and operates nine teaching centers throughout the western United States, including in FTTH communities Cody and Powell, Wyo. The company is open for business 24 hours a day, seven days a week. It’s the largest new job creator in the region. Said President Barack Obama in January

20

2011, “In Ten Sleep, Wyo., a town of about 300 people, a fiber optic network allowed a company to employ several hundred teachers who teach English to students in Asia over the Internet, 24 hours a day. You’ve all heard about outsourcing. Well, this is what we call ‘insourcing,’ where overseas work is done right here in America.” Rob Duncan, COO of Alpine Access, a provider of contact center services that uses home-based agents, also opened a virtual call center in Powell. He said, “Consider the 5,500 residents of Powell, Wyo. With 20 percent of the population below the poverty line and the town located 500 miles from the largest metropolitan area, the citizens knew something drastic needed to be done to save the idyllic quality of life they cherished in a small town. Together they decided to spend $4.9 million on connecting each home to a private-public fiber optic network. This

high-speed access helped connect them with distant relatives, provided online shopping and opened up new markets for local businesses. It also made the entire population attractive to virtual call center recruiters.” ChaTTanooga gains 2,400 JoBs As many as 2,400 jobs – at a new Volkswagen Passat factory and an Amazon distribution center, among others – have come to Chattanooga, Tenn., because of its fiber-based broadband and the reliable power that its fiber-enabled smart electric grid guarantees. In addition, the city is attracting a new generation of entrepreneurs and gaining a reputation as a place to start and grow businesses. Even companies based in Knoxville, 100 miles away, are looking to Chattanooga when they want to expand. Education and health care in the city have benefited, too. For example, access to self-paced learning on the Web


allows public school teachers to spend an average of two extra hours per day helping individual students . Because Chattanooga’s major hospitals are linked with rural hospitals, stroke patients get faster care, and radiology readings can be completed within 15 minutes rather than 24 hours . AuburN retAiNS A key emPloyer In 2005, Cooper Industries, a Fortune 200 company whose global data operations were located in Auburn, Ind ., was at a crossroads – it had to either expand its Auburn facility or relocate . The company’s most critical requirement was for fast, resilient and reliable broadband . Auburn Essential Services, a municipal broadband provider, worked with Cooper to craft a business-class broadband service and thereby preserve $7 million in annual payroll for the community . In addition, the city has retained a number of Internet-dependent, small but growing businesses . PriNtiNg FACility loCAteS iN briStol, teNN. The Bristol Herald Courier’s new printing production facility features a state-of-the-art printing press – the first of its kind in the country . Owned by Media General and built by BurWil Construction Company, the $21 million facility has 50,000 square feet dedicated to producing and distributing seven Southwest Virginia newspapers . Jim Hyatt, Media General’s regional vice president and publisher, said high-speed data transfer and reliable fiber optics were its main reasons for locating the facility in Bristol . More examples from Bristol, Tenn ., are available at www .btes . net/btestestimonials .html .

Auburn, Ind ., retained key employers by providing fiber connectivity .

Revitalization Commission, businesses in seven rural counties in southwestern Virginia now have access to broadband speeds of up to 1 Gbps and to transparent LAN service, which vastly improves their communications and networking capabilities . High-tech companies Northrop Grumman and CGI both built major facilities in Russell County, and two new industrial parks were constructed . By 2008, the high-tech infrastructure had brought 1,220 new jobs to the region, with more than $50 million in new private investment and $37 million in annual

payrolls . Growth has continued through the recession . Small health clinics in isolated locations of Southwest Virginia can now be digitally linked to larger comprehensive hospitals . The University of Virginia at Wise launched the state’s first undergraduate software engineering program in partnership with Northrop Grumman and CGI . In addition, the town of Lebanon turned a former shopping center into the Virginia Technology Development Center, a new hightech training facility managed by the University of Virginia at Wise .

briStol, vA., trANSFormS itS eCoNomy The fiber network in Bristol, Va ., has fundamentally changed the economic face of Southwest Virginia . Thanks to grants from the U .S . Department of Commerce and the Virginia Tobacco Indemnification and Community summer 2012 | www.bbcmag.com | BROADBAND COMMUNITIES | What Fiber Broadband Can Do For Your Community |

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Instead of outsourcing support to offshore call centers, companies are “insourcing” to FTTH communities. leNoWiSCo Fiber NurtureS buSiNeSSeS More from Southwest Virginia: Many businesses were able to stay or expand in the region because of broadband, including home-based businesses and larger ones such as Crutchfield Electronics . New businesses that located in the area because of LENOWISCO’s broadband network include OnePartner, an advanced technology and application center and the only commercial Tier 3 data center in the United States . Holston Medical Group stores its electronic medical records at OnePartner’s data center, taking advantage of the data center’s capacity and connectivity to run virtual clinical trials . In this economically depressed area, residential customers also use broadband to better their lives . Close to one-third use their broadband service either for distance learning – to earn degrees that would make them eligible for better-paying jobs – or in home-based businesses . These work-from-home employees and owners of cottage industries include an interior designer who uses broadband to search for design inspirations, agents who manage health insurance programs for a national health insurance company, a person who manages orders for a national floral service over the Internet and a toolmaker who sells wedges for leveling mobile homes .

opened in 2005 and has employees around the state . Mayes said he chose Macon and Lebanon, Mo ., for his offices because those cities had already run fiber to every business and household in their area . His company would open offices only in communities with access to highspeed Internet, Mayes said . yAhoo loCAteS dAtA CeNter iN ChelAN CouNty, WA. Yahoo picked Wenatchee for a data center site . Said Kevin Timmons, Yahoo’s vice president of operations, “We chose North Central Washington for this important facility because of the great quality of life here, the immediate availability of suitable space, the ‘can-do’ spirit of port and other community leaders we’ve met, the cost and reliability of electricity and the access to a world-class fiber optic network . They’ve taken all the right steps to create a terrific environment for us .” gAiNeSville AttrACtS bioteCh ComPANieS Gainesville, Fla .’s municipal fiber network

has attracted businesses and helped them expand . The Progress Corporate Park, located outside Alachua, hosts many biotech organizations as well as the University of Florida’s Sid Martin Biotechnology Incubator . GRUCom provides fiber services to Santa Fe College’s Alachua Corporate Training Center, located next to the research park . The center provides workforce training for the biotech industry . Gainesville partnered with the Council on Economic Development to provide high-speed connectivity to the Gainesville Technology Enterprise Center, which also fosters early-stage technology start-up companies . Several businesses that received connectivity at the center have matured and moved to locations where GRUCom’s services are available and continue to use them today . The fiber network has also allowed several existing companies to receive superior service at much lower prices . lAFAyette, lA., beComeS A mediA hub The municipal FTTH system in Lafayette has attracted call centers and video production operations – firms that depend on reliable broadband to move huge files back and forth among video editing and special-effects firms worldwide . The result: thousands of new jobs . v

The FTTH network in Gainesville, Fla ., helps incubate biotech businesses .

rurAl outSourCiNg FlouriSheS iN miSSouri Shane Mayes, CEO, describes Onshore Technology Services as a rural outsourcing company . It provides software development and integration and other technology services in competition with vendors in India, China, Mexico, Russia and Brazil . His company

22


introducing 1 gbps to the home

t

hough the average broadband download speed in the U .S . today is about 6 Mbps, many people are betting that a gigabit (1 Gbps, or 1000 Mbps) will be the standard soon enough for both downstream and upstream links . Only fiber to the home can support this standard . Google’s FTTH deployment in Kansas City, Kan ., and Kansas City, Mo ., made “gigabit” a household word, but Google is hardly the first to offer these speeds . Many providers now offer gigabit – or even 10 gig – speeds to businesses . Among residential providers, EPB Fiber Optics (the municipally owned network in Chattanooga, Tenn .) offers 1 Gbps access throughout its service area, as does LUS Fiber in Lafayette, La ., UTOPIA in Utah and Morristown Utility Systems FiberNET in Morristown, Tenn . In addition, Sonic .net in Sebastopol, Calif ., and Case Western Reserve University in Cleveland, Ohio, offer 1 Gbps service in limited areas, and other providers plan to offer such services soon . More than three dozen American research universities are collaborating on Gig .U, a program to bring 1 Gbps fiber access to the communities surrounding their campuses . One of the first projects is centered on the University of Maine in Orono, close to the depressed Bangor area . The service provider will be GWI, an independent ISP in Maine .

minutes . Or collaborating with classmates around the world while watching live, 3D video of a university lecture .” Since Google began building the network, the two Kansas City governments have been working closely with the private sector and local foundations to make sure the community derives maximum benefit from the new infrastructure . In Chattanooga, Harold DePriest, CEO of EPB, called his city’s FTTH network “the basis for creating the products and services of the Internet of the future .” The city is sponsoring a “Gig Tank” – a summer program in which entrepreneurs and students compete to develop gigabit business ideas, test them with real customers on a live network, and win real money and mentoring to help commercialize their ideas . US Ignite, a public-private project launched this year by the White House Office of Science and Technology Policy, chose Chattanooga, Lafayette and other communities as test beds to develop the applications of the future . The project is focusing on new applications in health care, education, workforce development,

energy, advanced manufacturing and public safety . eArly gig AdoPterS A recent survey by Telecom Thinktank and RVA LLC found (not surprisingly) that 1 Gbps subscribers are heavy Internet users – or even households with several heavy Internet users . They are online an average of eight hours per day, compared with the overall average of 2 .5 hours per day, and they have many networked devices . Some of them may be streaming movies and chatting on Facebook while participating in multiple online games through multiple consoles . In addition, many are content creators . Traffic measurements by Hong Kong Broadband, which provides 1 Gbps service in Hong Kong, show its gigabit subscribers use three times more upload bandwidth than download bandwidth . Upload speed is critical for distributing HD photos and videos, efficient cloud computing and virtualpresence videoconferencing . Finally, superfast connectivity also appeals to work-at-home professionals who need low latency and rapid file transfers . v

WhAt Will you do With A gig? When it announced its program, Google offered several scenarios . “Imagine sitting in a rural health clinic, streaming threedimensional medical imaging over the Web and discussing a unique condition with a specialist in New York,” its statement said . “Or downloading a high-definition, full-length feature film in less than five summer 2012 | www.bbcmag.com | BROADBAND COMMUNITIES | What Fiber Broadband Can Do For Your Community |

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Builders, Real Estate Developers and FTTH

V

irtually all large developers of single-family homes and many developers of multiple-dwellling-unit (MDU) communities add FTTH to new properties. Many are retrofitting older properties as well. Before the housing boom ended, RVA LLC estimated, on the basis of surveying home buyers and developers, that FTTH added about $5,000 to the price of a home. The size of the price differential is less certain today, but FTTH homes clearly sell faster than homes without FTTH. By mid-2006, FTTH was economically viable in new developments with as few as 80 MDU living units or 100 singlefamily homes. That number has continued to fall based on improvements in deployment technology. Though only about 6 percent of MDU residents have fiber connections today, the technology is rapidly becoming mainstream in the multifamily world. In a 2012 survey of MDU property owners and property managers by RVA LLC, most said superior broadband was an important advantage in terms of marketing, occupancy or tenant satisfaction. Those who understood that fiber to the home could deliver superior broadband were interested in installing it – in fact, though

only about 39 percent of survey respondents were aware of FTTH at the outset of the survey, 42 percent said they thought FTTH was important to tenants, and by the end of the survey, 49 percent said they would be interested in installing it in new buildings. (All these percentages were considerably higher for respondents with new properties, higher-end properties and large properties.)

Fiber can be bent tightly around corners and is now almost as easy to install in buildings as cable.

Perceived Benefits For MDU Properties With Superior Broadband Increased word-of-mouth marketing Fewer complaints / higher satisfaction Increased closing/occupancy rates Reduced resident churn Increased rental prices

0%

42% 39% 10%

20%

30%

40%

50%

59%

60%

70% 68%

70%

80%

Excellent broadband service is a major marketing advantage for MDU properties; two of five respondents said this translates into increased rental prices, according to a 2012 survey of MDU owners and managers commissioned by Broadband Communities and conducted by RVA LLC.

For more information on this survey, see the July 2012 issue of BroadBand Communities. 24


Interest In Providing FTTH For New MDUs 18%

Very interested

31%

Somewhat interested 11%

Not very interested

40%

Not at all interested 0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Thirty-nine percent of survey respondents were aware of FTTH before the survey was taken, but once the technology was explained to them, 49 percent were interested in installing it in new MDU properties.

Interest In Providing FTTH For Existing MDUs Very interested

10%

Somewhat interested

37%

Not very interested

19%

Not at all interested

33% 0%

5%

10%

15%

20%

25%

30%

35%

40%

Interest in installing FTTH in existing MDUs was slightly lower – largely because retrofits are more difficult and expensive – but still exceeded the percentage of respondents who were aware of FTTH at the beginning of the survey.

Reasons For Interest In Providing FTTH For New MDUs 21%

Amenity/ Competition w/ other properties Easier to install in new property Technical people here Interest/ Resident inquiries/ Satisfaction Faster/ Fast/ Upgrade More options for residents Future proof Cost effective in new construction More bandwidth will be needed in future

18% 14% 14% 9% 8% 7% 5% 4% 0%

5%

10%

15%

20%

25%

Those who said they were interested in FTTH for new buildings are aware of the ease of installing FTTH in greenfield construction and of the long-term advantages of FTTH for property values. summer 2012 | www.bbcmag.com | BROADBAND COMMUNITIES | What Fiber Broadband Can Do For Your Community |

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Questions real estate developers Ask About Ftth Q: How can I justify adding to the price of a home in a weak market? A: First, don’t assume that fiber is more expensive to install than copper – that’s not necessarily the case . Second, homes sell for higher prices when they are wired for high bandwidth and provide access to fiber . What’s more, FTTH homes sell faster than non-FTTH homes in the same market . In good times, this may translate into a greater profit, but it’s even more important in bad times . If few homes are sold, you can bet that homes with high-bandwidth amenities sell faster . This is equally true for rental properties . Developers of multiple-dwelling-unit communities say their new buildings lease up faster if they can advertise them as fiber-connected . Q: Do buyers and renters really care about fiber to the home? How many of them have heard of it? A: They really care about fast, reliable broadband . Survey after survey shows that FTTH customers are more satisfied with their broadband and TV service than cable, DSL and wireless customers . Q: Do I need to hire an engineering firm to design the installation? A: Fiber does need to be engineered in large apartment complexes – that’s true for coax, too . But smaller installations, as with smaller corporate LANs, do not need that kind of sophistication to work well . Greater standardization, clever new systems from equipment vendors, fiber that can be stapled and bent tightly around corners, distributors’ growing design expertise and an expanding corps of qualified technicians have made less formal design regimes feasible in the last few years . Q: Will other labor on my construction site damage the fiber cable?

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Do home buyers and renters really care about fiber? What they care about is fast, reliable broadband – and surveys show they are satisfied with FTTH service. A: Optical fiber is very, very thin – thinner than a human hair . But fiber vendors have developed many techniques to protect fibers from harm . Cable can be armored to ward off cuts . Contractors can route inexpensive microduct – hollow plastic tubes typically 1/8 inch in diameter – through walls before the walls are closed in with drywall or other materials . The microducts are easily repairable . After everything else is completed , thin fiber can be “blown” through the microduct for hundreds of feet . New fiber can be bent almost like copper . Some vendors offer fiber in thin adhesive tape that can be rolled onto walls . Q: Do any building codes pertain to fiber? The stuff seems inert. A: Yes, all the usual fire and life-safety issues apply . For instance, just as copper with PVC sheathing would be considered a life-safety hazard because of the combustion products released when it burns, so would various plastics used in fiber that is meant for outside installation . Indoors, look for Low Smoke Zero Halogen (LSZH) cables . If you are using thin plastic microduct, it should be labeled Halogen-Free Flame Retardant . You use a simple junction box to change from “outside” to “inside” wiring, just as you might with electrical cables . Of course, you should check with your local building code inspector . Aside from fire issues, codes may govern where

fiber optical network terminals (ONTs – the boxes that convert pulses of light from the fiber into electrical signals for the computer or TV) may be placed on the outside walls or in common areas . A few municipalities specify where network connections should be placed in homes . Q: Where should we put users’ network connections, assuming no specific building code or guidance document covers that subject? A: Expect users to desire broadband connections in virtually any room in the house – bedrooms, office-dens, the kitchen . That’s because Internet connections these days accommodate telephones, televisions, set-top boxes, digital picture frames, security sensors, fire and smoke monitors and, of course, computers . As the “Internet of things” develops, more appliances will be Internet-enabled . To minimize wireless interference inside multifamily buildings, experts often advise using wired Ethernet connections for all stationary IP-connected devices . Portable consumer electronics devices, such as smartphones and tablets, usually communicate with the Internet via Wi-Fi – as do appliances (manufacturers have adopted a standard for building Wi-Fi into major appliances), so you also need a wireless gateway . Such gateways are offered by all vendors as standard-issue, to be used on the home side of fiber network deployments .


Q: In single-family homes, I often see ONT boxes hung on the outside walls. Can they also be placed indoors? A: Yes . In harsh climates, where heat or heavy snow could affect the outside installation, you will probably want to put ONTs indoors . Outdoor ONT models are sometimes placed in garages or utility rooms; you can also buy small, portable indoor models that look more like cable or DSL modems and connect them with tough, flexible fiber that can be laid anywhere . Indoor ONTs, which are popular with apartment dwellers, are sometimes designed to be user-installed .

Q: Is FTTH a sustainable technology? A: FTTH generally consumes less power than other broadband technologies . Passive optical networks (GPON and EPON) are especially energy-efficient because they require no active electronics in the field . FTTH enables more sustainable lifestyles, too . A 2008 study by PricewaterhouseCoopers showed that the greenhouse gas emissions associated with deploying

an FTTH network are outweighed within five years by the savings from increased telecommuting . Other fiberenabled applications, such as telehealth, telepresence, distance learning and cloud computing – and, of course, smart-grid applications and home energy management – reduce travel, minimize heating and cooling loads or help shift energy consumption to renewable sources . v

Q: Why do ONTs require backup batteries? A: Optical fiber cannot conduct electricity . Thus, to keep a network connection running during a power outage, you need a battery at the user premises or a fiber cable that includes a thin copper conductor connected to an off-site battery . This requirement may change as cellular phones replace landlines – a change that has already taken place in most of Europe . In North America, where about two-thirds of customers still have landlines, many standard designs are available for in-wall, between-stud boxes that hold the battery, ONT and fiber connections . Q: Does every dwelling unit or office need its own ONT located at the unit? A: No . Separate ONTs for each unit in a multiple-dwelling-unit building can be located centrally, often in a basement or an equipment cabinet . There are also ONTs designed to serve multiple units, typically four or eight . This flexibility is made possible by new, smaller, lowpower circuitry and by the fact that some ONTs can deliver 1 Gbps or more – enough bandwidth to share among multiple customers . Q: Is lightning a problem with fiber? A: No . Because fiber does not conduct electricity, lightning strikes do not affect fiber at all .

Pathways for structured wiring can be created before walls are finished .


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Property developers beat the recession With Fiber Ftth AmeNity helPS leASe uP Forty57 iN lexiNgtoN hen Ball Homes started building Forty57, a 360-unit luxury apartment community just southeast of downtown Lexington, Ky ., and the University of Kentucky, it needed an extra edge . With the first units coming online in May 2009, the developer was not only leasing a greenfield development in the depths of the Great Recession but also offering a higher-end product for a sophisticated demographic at a time when doubling and tripling up had suddenly come back into vogue . To add value to its offering and ensure that the community stayed on the cutting edge of technology for the foreseeable future, Ball Homes partnered with Little Rock, Ark .-based Windstream Communications . After negotiating a bulk subscription deal for residents, Windstream deployed a GPON fiber-tothe-unit network at the community to light up a triple-play offering of voice, video and data, including dedicated 911 connectivity . For $89 a month, residents could enjoy a take-if-you-want base programming package that included 12 Mbps data speeds; 60 channels of DISH Network programming, including HBO; and incoming terrestrial phone service plus 911 over traditional phone lines . Forty57 was the first fiber-to-the-unit MDU in the Lexington market . Although Ball Homes thought an optional amenity would be more palatable during tight times, Windstream saw nearly a 100 percent take rate from residents who moved into the first phase of the project, and occupancy was 75 percent after nine months . Why? Forty57

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has amenities that go beyond the pool, gym and community lounge . “By going with fiber, we’re at the top of the game here locally while futureproofing the property for the foreseeable future,” says Brandon Buffin, Ball Homes’ IT director . “It’s been quite a positive .” At the AlexAN midtoWN, Ftth oFFerS ‘more For the moNey’ For Trammell Crow’s Steve Hester, just getting the Alexan Midtown project up and running was a Herculean task . In 2007, while his team was planning the 275-unit mid-rise on the edge of Sacramento’s hip Midtown area, the wheels started coming off capital market financing . Originally, Trammell Crow envisioned the project as a condominium whose units would be marketed to young professionals working in Sacramento’s health and government sectors, but it had to modify that plan quickly as lenders began to balk .

The company thought the project still made sense as a rental . The site is located in Sacramento’s “medical triangle” within easy biking distance of three major hospitals and just a few minutes from the California State Capitol and myriad state government offices and agencies . There was only one catch: Given Sacramento’s starring role in the housing debacle, with the area ranking near the top of foreclosure statistics nationally, the rental market was flooded with houses that otherwise would have been for sale . That, in turn, put pressure on apartment rents . For the Alexan Midtown to compete, it would need to offer residents more for their money, including state-of-theart technology that would appeal to the young medical and government professionals that were still its target market . That was especially true because of the Midtown price point – studios were advertised for just under $1,400 a month,

The Alexan Mid town in Sacram ento has “the real deal” – an all-fiber-o ptic network .


more than double the rent of other entrylevel digs in the area. One differentiator materialized by chance. Because the aesthetics of the project called for existing overhead cables to be buried underground, Hester got to work contacting the owners of those cables. One happened to be Roseville, Calif.-based SureWest, an independent ILEC that has been aggressively rolling out IP-based services in Northern California. SureWest started offering IP-based HDTV as early as 2006 in the greater Sacramento area and already had a fiber ring running right past the Alexan site. “I’ve been doing this for 30 years, and that almost never happens, where there’s actually existing fiber fronting the property,” Hester says. “If it does happen, you usually can’t tap into it because it’s for 911 or a hospital or someone else’s dedicated use. But in this case, we had SureWest right there, and they were only too happy to serve the property.” Because the property already had fiber running literally to its door, the developer decided to make an investment for the future and take the fiber path all the way to all units, offering data speeds up to 50 Mbps. “Oftentimes, people talk about having a fiber network. But I think … that term has gotten watered down, just as the term ‘organic’ has been overused in the food industry. Nobody knows what it means anymore,” Hester says. “But at the Alexan, we have the real deal. This is a pure fiber system. As far as we can tell, no one else in the market can say that.” The project has been a success for SureWest, which quickly signed up 55 percent of the project’s tenants. And it has been a success for Trammell Crow as well. v

is it Really Fiber To the home?

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hen service providers advertise “fiber rich,” “fiber deep” and “fiber optic” networks, how do you know whether you’re really getting fiber to the home? In 2006, the FTTH Councils for Europe, Asia and North America standardized the definitions for fiber to the home and fiber to the building (also called fiber

to the basement). They are: FiBeR To The home (FTTh) A fiber optic communications path that extends from an operator’s switching equipment to at least the boundary of a home living space or business office space. The definition excludes architectures in which the optical fiber terminates before reaching either a home living space or business office space and the access path continues over a physical medium other than optical fiber. FiBeR To The BuilDing (FTTB) A fiber optic communications path that extends from an operator’s switching equipment to at least the boundary of a private property that encloses homes or businesses. The optical fiber terminates before reaching home living spaces or business office spaces. The access path then continues over another access medium, such as copper or wireless, to subscribers. Only FTTH is truly unlimited, but FTTB can provide as much capacity as most households and small businesses can use today.

Some “FiBeR” neTWoRkS ARe noT FiBeR To The home Other network architectures are not officially defined. Their capacity depends on how far users are from nodes and/or on the number of users on each node. FiBeR To The noDe oR FiBeR To The neighBoRhooD (FTTn) In an FTTN network, fiber is extended to a street cabinet or an on-pole cabinet within 1,000 to 5,000 feet of the average user. From there, copper or wireless serves users, typically through a variant of DSL (Digital Subscriber Line). FiBeR To The CuRB oR FiBeR To The CABineT (FTTC) FTTC is similar to FTTN, except that the fiber is brought closer to user premises – typically closer than 1,000 feet and often closer than 300 feet. hyBRiD FiBeR-CoAx (hFC) This architecture is used mainly by cable TV companies. In a typical HFC system, fiber runs to a node in each neighborhood, and coaxial cable running from the node serves between 100 and 500 users.


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Printed FTTH primers are helping thousands in communities get on the same page about the benefits of fiber networks.

FTTH marketing campaigns use volunteers, both adults and children, to reach every household and business in a project area.

Besides the primer, mailing packets include brochures, questionnaires and schedules of public meetings about fiber networks.

campaigns to send FTTH primers to every household and business.

“The primer is an EXCELLENT WAY to not only EDUCATE people about the basics of FTTH but also INFORM them of its MANY BENEFITS.” —mark erickson City administrator and economic development director - winthrop, minn.

Get more information or place your request for a bulk shipment of printed primers for your community at:

www.FTTHPrimer.com

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Analyze the Financial Viability of Any FTTH Project Fiber-to-the-Home system Analyzer Xyz Project: 20% equity/80% Debt Total homes and businesses passed Total subscribers at year end Average subscribers for year Total system construction cost Equity Debt, principal not including financing fees Cost to purchase and install customer premises equipment Cost to purchase and install central office equipment Direct costs per subscriber Analysis Construction Costs: Cost to pass one home or business Cost to connect one home or business systemwide Take rate, year end, at least one service taken systemwide Take rate, Midyear Average

year 1 year 2 year 3 10,000 16,000 18,250 2,500 6,000 7,300 1,250 4,250 6,650 16,829,954 22,093,748 24,396,793 5,000,000 5,000,000 5,000,000 20,000,000 20,000,000 20,000,000 2,057,500 4,794,500 5,760,400 14,772,454 17,299,248 18,636,393 823 782 743

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