magyar telekom technicalapproachfor broadbandaccess · (ftt(ftth hhh)))) extended bandwidth optical...
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Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 1
====!"§==Com=
Magyar Telekom technical approach forbroadband access
Peter Janeck
CTO, Magyar Telekom
Networks 2006 Conference
New Delhi, November 6-9, 2006
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 2
Magyar Telekom areaMagyar Telekom areaMagyar Telekom areaMagyar Telekom area•GDP/capita (EUR): 6 631•Population (thousand): 7 797•# of fixed lines (100 habitants): 36,1
Budapest
Pécs
Miskolc
Szeged
Székesfehérvár
GyőrDebrecen
Szolnok
ZalaegerszegKecskemét
Baja
Kiskőrös
Kiskunhalas
SzigetvárMohács
Ózd Szerencs
Mezőkövesd
Békéscsaba
Orosháza
Szentes
Dunaújváros
Sopron
Berettyóújfalu
Eger
Gyöngyös
Jászberény
Karcag
Tatabánya
Esztergom
Salgótarján
Balassagyarmat
Biatorbágy
Cegléd
Gödöllő
Vác
Szentendre
Sziget-
Kaposvár
Marcali
Siófok
Nyíregyháza
Kisvárda
Mátészalka
Szekszárd
Paks
Szombathely
Sárvár
Veszprém
Pápa
Tapolca
Keszthely
Nagykanizsa
szentmiklós
Monor
MT technical approach for broadband accessHungary key economic and telco indicators
EmitelEmitelEmitelEmitel areaareaareaarea•100 % owned by Magyar Telekom
Reported revenues
grew by 5.4% to HUF 316 bn (EUR 1,154.7 m) in Q2/06
Reported EBITDA increased by 0.5% to HUF 124.7 bn
EBITDA margin of 39.5%.
PSTN lines Q2/06 2.131.000
Down by 4.6% compared to a year agoADSL lines Q2/06 417.791
More than 20% increase compared to Q4/05
Magyar Telekom already presents
Magyar Telekom PoP
Macedon iaMacedo n iaMacedo n iaMacedo n ia
Hu n ga r yHu n ga r yHu n ga r yHu n ga r y
C roa tia
Serbia
S lov enia
Bosnia -
H e rz egov ina
U kra ineMoldova
G reece
Bulga ria
R omania
Mo n ten eg roMo n ten eg roMo n ten eg roMo n ten eg ro
A lbania
Magyar Telekom already presents
Magyar Telekom PoP
Macedon iaMacedo n iaMacedo n iaMacedo n ia
Hu n ga r yHu n ga r yHu n ga r yHu n ga r y
C roa tia
Serbia
S lov enia
Bosnia -
H e rz egov ina
U kra ineMoldova
G reece
Bulga ria
R omania
Mo n ten eg roMo n ten eg roMo n ten eg roMo n ten eg ro
A lbania
Magyar Telekom already presents
Magyar Telekom PoP
Macedon iaMacedo n iaMacedo n iaMacedo n ia
Hu n ga r yHu n ga r yHu n ga r yHu n ga r y
C roa tia
Serbia
S lov enia
Bosnia -
H e rz egov ina
U kra ineMoldova
G reece
Bulga ria
R omania
Mo n ten eg roMo n ten eg roMo n ten eg roMo n ten eg ro
A lbania
Magyar Telekom already presents
Magyar Telekom PoP
Macedon iaMacedo n iaMacedo n iaMacedo n ia
Hu n ga r yHu n ga r yHu n ga r yHu n ga r y
C roa tia
Serbia
S lov enia
Bosnia -
H e rz egov ina
U kra ineMoldova
G reece
Bulga ria
R omania
Mo n ten eg roMo n ten eg roMo n ten eg roMo n ten eg ro
A lbania
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 3
Low Internet and PC Low Internet and PC Low Internet and PC Low Internet and PC penetrationpenetrationpenetrationpenetration
Low mobility premium and Low mobility premium and Low mobility premium and Low mobility premium and high fixedhigh fixedhigh fixedhigh fixed----mobile mobile mobile mobile
substitutionsubstitutionsubstitutionsubstitution
Relatively small market Relatively small market Relatively small market Relatively small market size, strong fixed and size, strong fixed and size, strong fixed and size, strong fixed and mobile dependency mobile dependency mobile dependency mobile dependency
Low purchasing power and Low purchasing power and Low purchasing power and Low purchasing power and high telco/GDP spendhigh telco/GDP spendhigh telco/GDP spendhigh telco/GDP spend
Comparison of telecom Comparison of telecom Comparison of telecom Comparison of telecom spending as % of GDPspending as % of GDPspending as % of GDPspending as % of GDP
Germany ItalyAustria UK Hungary
GDPGDPGDPGDP per per per per capitacapitacapitacapita –––– purchasing purchasing purchasing purchasing power parity power parity power parity power parity (EUR)
2002 2003 2004 2005
Mobile**Mobile**Mobile**Mobile**
FixedFixedFixedFixed
3.2 bn. min.
4.7 bn. min.
FixedFixedFixedFixed----mobile substitutionmobile substitutionmobile substitutionmobile substitution(minutes, 2002-2005)
28,233,6
26,1
3,0
18,8
15,5
17,4
2,0
1,4
1,7
Germany UK Italy Austria Hungary
Fixed and mobile telecom Fixed and mobile telecom Fixed and mobile telecom Fixed and mobile telecom market size market size market size market size (EUR billion)
MT technical approach for broadband accessMarket features specific to Hungary
Mobile has grown rapidly, Mobile has grown rapidly, Mobile has grown rapidly, Mobile has grown rapidly, fixed line penetration has fixed line penetration has fixed line penetration has fixed line penetration has slowed, voice has slowed, voice has slowed, voice has slowed, voice has inevitably migratedinevitably migratedinevitably migratedinevitably migrated
6% 8%12%
16%20%
26%
31%
2002002002001111 2002002002002222 2002002002003333 20020020020044442002002002005555 2002002002006666 2002002002007777
17%
23%
29%
35%39%
43%47%
2002002002001111 2002002002002222 2002002002003333 2002002002004444 2002002002005555 2002002002006666 2002002002007777
2,3% 2,3%
3,1% 3,3%
4,3%
Internet penetration of Internet penetration of Internet penetration of Internet penetration of householdshouseholdshouseholdshouseholds
PC penetration of householdsPC penetration of householdsPC penetration of householdsPC penetration of households
Mobile premium price Mobile premium price Mobile premium price Mobile premium price decreaseddecreaseddecreaseddecreased
3332
3638
43
4850
58
36353537
34312836
3% 3%
-9% -8%
19%41%
61%
107%
0
10
20
30
40
50
60
70
2000 2001 2002 2003 2004 2005
Q I.
2005
Q II.
2005
Q III.
-20%
0%
20%
40%
60%
80%
100%
120%Average mobile min cost
Fixed minute cost
Mobile price premium
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Subscriber (thousand)
27 452 27 81826 447
30 011
14 198
Germany UK Italy Austria Hungary
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 4
PSTN resellers
Pure-play VOIP providers
Core sources of competition
Pure-play mobiles
Alternative own network
providers
Mobile
Fixed
Internet
Data
CATV
Alternative integrated /
cost synergy providers
Mobile
Fixed
Internet
Data
CATV
Extended sources of competition
MT technical approach for broadband accessCompetitive landscape
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 5
54%
19%
27%
Magyar Telekom UPC Others
80%
11% 9%
Magyar Telekom Invitel Others
45,3%
33,3%
21,4%
T-Mobile Pannon Vodafone
MT technical approach for broadband accessMarket leadership in a highly competitive environment
Mobile Market Fixed Line Market
Broadband Market
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 6
MT technical approach for broadband accessMain trends impacting MT’s business.
BroadbandBroadbandBroadbandBroadband
MobilityMobilityMobilityMobility ServicesServicesServicesServices
Moving forwardMoving forwardMoving forwardMoving forwardfixedfixedfixedfixed----mobile convergencemobile convergencemobile convergencemobile convergence
and quadruple playand quadruple playand quadruple playand quadruple play
Growing internet penetration and Growing internet penetration and Growing internet penetration and Growing internet penetration and bandwidth demandbandwidth demandbandwidth demandbandwidth demand
Common strategy between TCommon strategy between TCommon strategy between TCommon strategy between T----CabelCabelCabelCabeland Tand Tand Tand T----Com for offering enhanced Com for offering enhanced Com for offering enhanced Com for offering enhanced
services (services (services (services (VoipVoipVoipVoip, IPTV, 3play), IPTV, 3play), IPTV, 3play), IPTV, 3play)
NGNNGNNGNNGNDevelopmentDevelopmentDevelopmentDevelopment
Wireless broadband Wireless broadband Wireless broadband Wireless broadband access solutions with access solutions with access solutions with access solutions with portable intelligent portable intelligent portable intelligent portable intelligent devices based on devices based on devices based on devices based on
IP/NGNIP/NGNIP/NGNIP/NGN
Multimedia services for Multimedia services for Multimedia services for Multimedia services for information, communication information, communication information, communication information, communication
entertainment, etcentertainment, etcentertainment, etcentertainment, etc
Mobile dominates voice marketMobile dominates voice marketMobile dominates voice marketMobile dominates voice marketMerging TMerging TMerging TMerging T----Mobile and Mobile and Mobile and Mobile and
TTTT----Com HungaryCom HungaryCom HungaryCom Hungary
Extend geographic coverageExtend geographic coverageExtend geographic coverageExtend geographic coverage
HighHighHighHigh----speed accessspeed accessspeed accessspeed accessIP network developmentIP network developmentIP network developmentIP network development
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 7
0000
500500500500
1 0001 0001 0001 000
1 5001 5001 5001 500
2 0002 0002 0002 000
2 5002 5002 5002 500
2005 2006 2007 2008 2009 2010
Lines (thousand)
Voice Total Voice Total Voice Total Voice Total - Target is to stop decline of
fixed voice
decreasing PSTN/ISDN lines decreasing PSTN/ISDN lines decreasing PSTN/ISDN lines decreasing PSTN/ISDN lines as the result
of external effects – competitors, mobile
and VoInternet substitution
ADSLADSLADSLADSL broadband access
NGN VoIP deploymentNGN VoIP deploymentNGN VoIP deploymentNGN VoIP deployment on broadband
access
MT technical approach for broadband accessForecasted fixed line development
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 8
MT technical approach for broadband accessBroadband customer evolution
� Targeted broadband customers at the end of 2008: 1.000.000� VoIP, IPTV and broadband gaming customers are also broadband access subscribers� MT VAS retail subscribers will take off and represent a significant portion of total
customer base: in year 2008 dual and triple players will be 15 % and 22 % of total access
3rd Party +
Corporate
DSL 1 million
Target
Thousand subscribers
535.000
864.000
662.000
336.000
26.000
116.000
239.000
11.00060.000
143.000
19.000
40.000
2005 2006 2007 2008
Broadband access
VoIP
IPTV
Gaming
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 9
MT technical approach for broadband access3play service delivery platform
MT’s 3play offer:� PSTN (later VoIP),� ADSL (512k, 1M, 2M)� IPTV with (44 channels + 400 films for VoD)
Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 10
====!"§==Com=
0,1 100101
Capacity[Mb/s]
LMDSPersonal Area
Indoor
Fixed Urban
Fixed
Nomadic
Pedestrian
Wal k
Fi xed
Wi MAX*
MobileWiMAX*
VehicleUrban
VehicleRural
High Speed
Vehicle
HSDPA*
WiFi*802.11
Wirel ess
MobilityWi re-
line**
ADSL
VDSL2
ADSL2+
UMTS*EDGEGSMGPRS
Flash OFDMIEEE 802.20
BlueTooth
DECT
GPON >>100 Mbit/s
MT technical approach for broadband accessFixed andwireless BB access technologies
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 11
MT technical approach for broadband accessApplied technologies and BB coverage
T-Com service area
T-Com BB service area
at the end of y. 2006
T-Com BB service area at
the end of y. 2009
2433 settlements
1 133settlements
Cca. 1 000settlements
1 000+ 300=1 300settlements
Rollout plan:
Wireline BB solutions
Settlements that cannot be served from business interest
Conceptually taken as for wireline BB solution
Developments funded with governmental or EU finance.Wireline or wireless solution is selected case by case.
0
100 000
200 000
300 000
400 000
500 000
600 000
700 000
800 000
900 000
1 000 000
2007 2008 2009 2012
ADSL ADSL2+ VDSL2 GPON
AvailabilityAvailabilityAvailabilityAvailability ofofofof technologiestechnologiestechnologiestechnologies VolumeVolumeVolumeVolume andandandand breakdownbreakdownbreakdownbreakdown
BroadbandBroadbandBroadbandBroadband coveragecoveragecoveragecoverage
20072007200720072006200620062006 2008200820082008 2009200920092009 2010201020102010
ADSL2+ADSL2+ADSL2+ADSL2+
VDSL2VDSL2VDSL2VDSL2
EthEthEthEth. SHDSL. SHDSL. SHDSL. SHDSL
GPONGPONGPONGPON
WiMAXWiMAXWiMAXWiMAX
WLANWLANWLANWLAN
HSDPAHSDPAHSDPAHSDPA
InInInIn pilot pilot pilot pilot phasephasephasephase ApplicationApplicationApplicationApplication
20072007200720072006200620062006 2008200820082008 2009200920092009 2010201020102010
ADSL2+ADSL2+ADSL2+ADSL2+
VDSL2VDSL2VDSL2VDSL2
EthEthEthEth. SHDSL. SHDSL. SHDSL. SHDSL
GPONGPONGPONGPON
WiMAXWiMAXWiMAXWiMAX
WLANWLANWLANWLAN
HSDPAHSDPAHSDPAHSDPA
InInInIn pilot pilot pilot pilot phasephasephasephase ApplicationApplicationApplicationApplication
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 12
� The focus is on the continued expansion of broadband access to exploit fixed network’s broadband capabilities.� Broadband development will serve objectives of IPTV (3play) and the multi-service NGN deployment.� Mass market broadband demands will be served on the basis of ADSL and next versions: ADSL2, ADSL2+, VDSL2.
MT technical approach for broadband accessDSL ranges and loop length distribution
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 13
• Building optical transport nearer to the user aims- accomplishing coverage to white spots and to solve real estate limits;- increasing bandwidth demands by new DSL standards, ADSL2/2+/VDSL2 having shorter range
• Implementing DSLAMs at different nodes on a cable-route causes interference problems. Avoiding disturbances needs careful planning and spectrum management.
• In long term optical deployment towards user endpoints is the general direction.FTTFTTFTTFTT----
CentralCentralCentralCentralOffice Office Office Office
FTTPFTTPFTTPFTTP(FTT(FTT(FTT(FTTHHHH))))
ExtendedExtendedExtendedExtendedbandwidthbandwidthbandwidthbandwidth
Optical Optical Optical Optical „„„„depthdepthdepthdepth””””
TechnologyTechnologyTechnologyTechnology
FTTNFTTNFTTNFTTN(FTTC(FTTC(FTTC(FTTC/B/B/B/B))))
ADSLADSLADSLADSL ADSL2/2+ADSL2/2+ADSL2/2+ADSL2/2+VDSL2VDSL2VDSL2VDSL2
ADSLADSLADSLADSLADSL2+ADSL2+ADSL2+ADSL2+1G PON1G PON1G PON1G PON
EFMEFMEFMEFM----FibreFibreFibreFibre100M/1G P2P100M/1G P2P100M/1G P2P100M/1G P2P
InitialInitialInitialInitialbroadbandbroadbandbroadbandbroadbandcoveragecoveragecoveragecoverage
A A A A rrrréééézhzhzhzháááállllóóóózatzatzatzatrrrréééészlegesszlegesszlegesszlegescsercsercsercserééééjejejeje
Full optical Full optical Full optical Full optical solutionsolutionsolutionsolution
Extended Extended Extended Extended broadband broadband broadband broadband coveragecoveragecoveragecoverage
Present Present Present Present statusstatusstatusstatus
NearNearNearNear----term term term term goalgoalgoalgoal
MT technical approach for broadband access
Phases of wireline BB access network deployment
MidMidMidMid----term term term term goalgoalgoalgoal
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 14
WiMAX can be used in the following frequency bands:• license exempt frequency band (5.8GHz,expected in 2007) • licensed frequency band (3.5 GHz) → greater range, higher availability and quality, lower interference→ suitable for guaranteed services (QoS)
High capacity: aggregated rate of one base station can supply about 700 ADSL equivalent subscribersLine of sight is not required → ease and freedom of installation
UMTS/
HSxPA
WiMAX
Urban
Suburban
Rural
WiMAX
implementations have
to be harmonised with
UMTS/HSxPA roll-out
WiMAX is to be used
where copper network
is not available / not
economical
MT technical approach for broadband access
WiMAX is a new, promising wireless broadband access technology
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 15
WiMAX expected pay-back
WiMAX can be utilized economically • in T-Com areas with low ADSL availability*;• broader opportunity of usage in LTO areas but possibility of
unbundling have to be taken account
Source: WiMAX Forum
MT technical approach for broadband access
Economical considerations for WiMAX application
ACF: Accumulated Cash Flow
ADSL availability: penetration and conditions of copper network for ADSL
implementation
� Despite of price drops, current prices of WiMAX equipment still prevent from positive short term
business cases for incumbents . Current and estimated specific CAPEX is EUR 650-850/customer
Source: EURESCOM P1554 (January 2006)
Accumulated cash flow
-30
-20
-10
0
10
20
30
40
2007 2008 2009 2010 2011 2012 2013 2014 2015
Year
Accumulated cash flow [million Euro]
GSM+Fixed
UMTS+GSM+Fixed
Fixed only
New entrant
Operator Competencies
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 16
MT technical approach for broadband accessWiMAX -Technological system built-up& working services as March 2006
WiNET
KLIP
MT 3,5 Ghz freqency:
3462,5 - 3476,5 MHz3562,5 - 3576,5 MHz
WiMAX Micro Base Station2 channels, DC
Sectorial ANTENNA
60 ; 90 ; 120° ° °
WiMAX Base StationOutdoor Unit
WiNET
KLIP
MT 3,5 GH freqency:
3462,5 - 3476,5 MHz3562,5 - 3576,5 MHz
VoIP IP PHONE
Ethernet
WLAN 802.11g
CPE Outdoor Unit withIntegrated ANTENNA
CPE Indoor UnitNetworking GatewayWireless
CPE Indoor Unit1*ETH
CPE Indoor Unit1*ETH
CPE Indoor Unit1*ETH
VoIP IP PHONE
CAT 5
Ethernet
WLAN 802.11g
VoiceGateway
POTS
1..8
POTS
1..8
CISCO 2650
Ethernet
WiNET
WiTALK
IVD3
IVD4
CPE Outdoor Unit withIntegrated ANTENNA
CPE Outdoor Unit withIntegrated ANTENNA
CPE Outdoor Unit withIntegrated ANTENNA
====!"§==Com=Magyar Telekom broadband access approachPeter Janeck, Magyar TelekomNetworks 2006, 9 November,200601/12/2006, page 17
MT technical approach for broadband accessOverview of ADSL Node and NodeB locations in the country
BlueBlueBlueBlue dots are the existing ADSL Nodes (2006)
RedRedRedRed dots are the new ADSL Nodes (2010)
PurplePurplePurplePurple blocks are the NodeBs in y.2010
Conclusion: Access methods for BB connections should be selected case by case,
area by area, based on economic considerations. Fix-mobile convergence
for incumbents is key for future success.