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Next Generation Telecoms: FttH and Trans-Sector Strategies

The deployment of Fiber to the Home (FttH) around the world is beginning to lead to exciting developments for the next generation of telecommunications. In particular, infrastructure based on FttH is providing the foundation for smart communities and cities where a number of technologies and services are combined to create an enhanced value proposition for residents. Smart homes connected to these networks can utilise services such as tele-health, e-education and e-government as well as access digital media and high speed Internet. Sustainability is also integral to the smart community with many environmental initiatives, such as smart grids, slowly becoming a reality.

While FttH networks had begun to arrive well before the financial crisis hit; surprisingly it is the crisis itself that is now driving fibre beyond its first stage. Many countries, such as the USA, UK, Australia and New Zealand, have included broadband networks in their economic stimulus packages. These developments are also pushing the countries that had already embarked on FttH to increase activities in their fibre markets. Examples include Finland, Norway, Switzerland, Greece and Japan.

Australia has emerged as an interesting model to watch as the government plans to invest A$43 billion in a national FttH broadband network. This is a clear indication that it believes broadband infrastructure is important for the collective good. The primary focus of the proposal comprises the establishment of a new utility (the National Broadband Corporation - NBC) to build and operate a super-fast wholesale-based National Broadband Network (NBN).

In Europe we have also seen extraordinary changes to the telecom networks as incumbents and new entrants switch on their All-IP Next Generation Networks. In addition there has been increased activity in fibre deployment as a result of the falling price of fibre builds and regulatory approval of municipal and government involvement in large infrastructure projects. While investments in Next Generation Networks (NGNs) are aimed at meeting burgeoning consumer demand for high-bandwidth applications, they have also triggered a number of regulatory changes on both the national and European levels as regulators endeavour to provide fair network access to competitors. These measures have included provisions for the functional separation of incumbent operators.

It is now becoming clear that a trans-sector approach is required to facilitate NGNs based on FttH. What is being referred to is the importance of looking across sectors to create synergy. If we consider the major benefit of fibre infrastructure to be that it acts as a conduit for sustainable economic growth and society development, then we need to change the structure of its business model. Only if fibre is made available as a utility will we be able to reap the trans-sectoral fruits of this infrastructure.

A trans-sectoral way of thinking can also be applied across infrastructure projects—looking at the potential synergies between the building of roads, sewerage systems, water and gas pipe networks, as well as telecoms and electricity networks. In short, it is trans-sector policies and strategies which will create the smart communities of the future.

By Paul Budde, Managing Director of Paul Budde Communication

Paul is also a contributor of the Paul Budde Communication blog located here.

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