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FTTH in Asia Pacific: Leading the way… Dr. Bernard Lee VP of APAC FTTH Council

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FTTH in Asia Pacific:Leading the way…

Dr. Bernard LeeVP of APAC FTTH Council

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Topics

1. Who is FTTH Council APAC?

2. Latest updates on FTTH in the region

3. Key considerations for network design

4. Key Challenges – across the region

5. Conclusions

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Role of the FTTH Council Asia-PacificAbout Us:Non-Profit Organization formed in Singaporesince March 2005

Mission :To educate, promote and accelerate FTTHand the resulting quality-of-life andeconomic benefits.

Objectives :• Supply a consistent and accurate view of

FTTH• Promote FTTH market development• Be recognized by the industry as the

FTTH resource

(2006 ~ 2011) (2011 ~ present)

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FTTH Council Global Alliance (FCGA)

70 Members

Source: APAC FTTH Council

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APAC: At a glance…

Monique Morrow(President)

Currently has 60+ members

BoD & 6 working committees

Bernard Lee YoshihiroIshibashi

Anil Pande Changkun Yan KuldeepGoyal

Xingfu He

Technology &Architecture

Regulation &Policy

MarketDevelopm’t

Planning,Comms. &

Events

Education &Training

CloudComputing &

GigabitApplications

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Latest market studies

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Year-end 2011: >200 million wireline broadbandsubscribers in Asia-PacificFTTH/B represents over 27% of wireline broadband subscribers in Asia Pacific which isapproximately 58million subscribers.

9%

18%

8%65%

FTTHFTTBCable ModemDSL

Source: Ovum

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0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

FTTH in Asia Pacific – Overall Figures

Source: IDATE for FTTH Council APAC, Dec 2011

88

Rank Countries FTTH/B subsDec 2011

1 Japan 22,045,000

2 China 21,300,000

3 South Korea 10,373,975

4 Taiwan 2,398,000

5 Hong Kong 1,070,000

6 Malaysia 255,800

7 Vietnam 250,000

8 India 175,500

9 Singapore 98,500

10 Australia 37,000

11 Indonesia 11,000

12 New Zealand 7,500

13 Philippines 800

Australia is oneof the

Top 10

Australia is oneof the

Top 10

99%

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FTTx is strong for the next 5 years• Worldwide, consumer FTTx subscribers accounted for 11% of wireline broadband

subscriptions in 2009, and will grow to 29% in 2016• In 2016, 50% of all wireline broadband subscribers in Asia-Pacific will be FTTx,

compared to 16% in Europe and 14% in North America

Source: Ovum

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FTTH/B leads the growth in wireline broadband inAP and will reach 140 million subscribersFTTH/B leads with a 21% CAGR compared to -2% for DSL

Source: Ovum

DSL:-2% CAGR

FTTH/B:+21% CAGR

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China will soon be the largest FTTH Market

• Asia-Pacific has always dominated consumption of worldwide OLT shipments• China’s share is increasing – almost 80% of worldwide ports shipped in 1Q11 were

destined for ChinaPON OLT port shipments

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

PO

N O

LT

po

rt s

hip

me

nts

China OLT port shipmentsTotal Asia-Pacific OLT port shipmentsWorldwide port shipments

Source: Ovum

35% CAGR forChina’s OLTports.

Compared to24% CAGR forAP andworldwide.

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FTTx market segmentation by country/region

China’s consumer FTTx subscriber base will grow to over 140 million in2016 from under 10 million in 2009

FTTx consumer subscribers by country or region

0

50,000

100,000

150,000

200,000

250,000

2009 2010 2011 2012 2013 2014 2015 2016

Year-end

FTTx

con

sum

er s

ubsc

riber

s (0

00)

China Japan & Korea Rest of AP Europe NA Rest of World

China represents 50%of worldwide FTTxsubscribers in 2016

Source: Ovum

Japan and Korea represent19% of worldwide FTTxsubscribers in 2016

Remainder represents31% of FTTx subscribersin 2016

Growing Market

Future Growth Area(e.g. India, LATAM, etc)

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Summary Drivers for FTTH in APAC

Source: iDate & Ovum

• Demography: a huge market potential• India and China are the most populated countries in the world• MDUs are dominating in large cities especially in China• Asia Pacific’s FTTH/B subscriber base will grow to 140 million at year-end 2015.

• Low competition from other networks• As in Eastern Europe, the “quality gap” between copper and fibre networks is

important: end users will need fibre for higher bandwidth• Cablecos are less dominating the broadband market than in Europe or in the US…

but it could change (SARFT in China)

• A key driver for mass market migration in APAC: NBN programs

• Incumbents leading rollouts in APAC but also some free room for new entrants• Some incumbents are deeply involved in national FTTH/B deployments (Malaysia)• New entrants in large countries (India) or in challenging markets (Vietnam)

• APAC Mobile centric countries will need fibre also: LTE Backhaul

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KeyConsiderations

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Key Considerations for successful networkdesign…

• Is your network able to support theapplications that are to be delivered today and‘tomorrow’?

• Is your network able to support theapplications that are to be delivered today and‘tomorrow’?

TechnicalPerformance

• Is your network design common and ‘robust’enough that the same or similar design can beused throughout your network

• Is your network design common and ‘robust’enough that the same or similar design can beused throughout your network

Repeatability& Reliability

• Are there sufficient security measures in thenetwork but still accessible for maintenanceand testing

• Are there sufficient security measures in thenetwork but still accessible for maintenanceand testing

Accessibilityand Security

• How will your network grow?• How will your network grow?Scalability

16

Quality

Source: adapted from Telekom Malaysia

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Key Challenges

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Challenges FTTH Deployment & Adoption – 5Cs

Competency

Civil &Construction

Content

CustomerEquipment

CustomerAwareness

Mature

Exploratory

Challenge Impact

Manpower need to becompetent to deploy &maintain the network

Up to date digital homeequipment to fully enjoy

benefits of FTTH

New guideline and bestpractices are required to

deploy fiber up tothe customer premises

New content is needed tocapitalize the additional speed

offered - Increase ARPU

FTTH will struggle to evolvebeyond being a just another

commodity product

Customers will fail toexperience benefits of FTTH

over DSL

Deter new users fromsubscribing to the FTTH

services due to extensive civilwork required

Insufficient skilled/competentmanpower will delay deployment

thus increasing TCO

Customers are unknown of thenew capabilities and potential

of FTTH

Customers reluctant to adoptFTTH services

Asia Pacific

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100Mbps

20

100

80

60

40

(US$)

2000 2001 2002

FTTH(for detached house )DSL

100Mbps500kbps 1.5M

12M 24M 40M8M

2003 2004

47M

2005

10Mbps

1GbpsFixe

d M

onth

ly C

harg

eFTTH price comparable to DSL but at much higherbandwidth

Source:

US$11/Mbps

US$0.5/Mbps

US$0.4/Mbps

US$0.04/Mbps

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Value Innovation…

Efficient Life - Leading a lifewhere technology assist you toutilise your resources (may itbe time, finances, etc) moreefficiently and so that you

could start spending qualitytime with your love ones andnot taking up the time with

routine activities at home andat the work place.

Entertaining Life - Bringing thebest of high quality

entertainment to your finger tipsanywhere & any time throughany means possible may it be

ultra-highspeed fibre networksat home or even through ultra-

mobile wireless connectionswhen we are on the go.

Eco-friendly Life - Giving back tothe environment to ensure our

future and the future of our nextgeneration and their next

generation by exploring the useof alternative power sources andalso smarter and more efficientenergy utilisation both at home

& at work

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22

How has broadband ‘value add’ our lives?

Matured InfancyDeveloping

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Digital Home offering an efficient lifestyle from …

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Verizon offers Energy Monitoring services for $9.99

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SmallMediumEnterprises

Enterprises

Paving the way for New Business Opportunities

ServiceProviders

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Fibre enhances customer experience

InteractiveButton

InteractiveButton

InteractiveButton

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27

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Finding out what isgoing on in your

community

Communicating withhealth care or

medical provider

Contributing toeconomic growth in

your community

Starting your viewswith others about

key issues

Communicating withgovernment officials

about issues% noted as important activity 68% 65% 62% 58% 57%

50%

52%

54%

56%

58%

60%

62%

64%

66%

68%

70%

Broadband activities cited as important byusers in terms of percentage (%)

Incr

easi

ng in

fluen

ce o

f bro

adba

ndon

dai

ly li

fest

yle

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Conclusion:

Fibre is not ananswer to our needs,but instead it is theENABLER of a futurefilled with infinitepossibilities…..

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