ServicesandApplicationsGuide

Wheredoesthemoneycomefrom?

Edition1

WorldofApplicationsCommittee

Revisiondate:14/02/2017

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Disclaimer This document is a work in progress. The content is intended as the basis for discussion and does not necessarily represent the official position of the FTTH Council Europe. Some of the content may reflect the position of members of the FTTH Council Europe and our partners. This document is provided on a professional best effort basis. The FTTH Council Europe does not guarantee the suitability for a particular purpose. No liability is accepted by the FTTH Council Europe for any consequential loss or damage whatsoever, however caused. All trademarks are acknowledged as being the property of their respective owners. For further information, feedback and input please contact Michaela Fischer, Project Manager, FTTH Council Europe, at michaela.fischer@ftthcouncil.eu

© FTTH Council Europe 2017 Wettelijk Depot: D/2017/12.345/1 This document is licensed under a Creative Commons License 3.0 Attribution, Non-commercial, No Derivatives. You are free to copy and share this document for personal use, but you should not alter, transform or build on this work, or use it for commercial purposes.

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Contents1. Whythisguide?.........................................................................................................................................52. Foreword...................................................................................................................................................63. Acknowledgements...................................................................................................................................74. OperatorModelsandRevenueSplits........................................................................................................8

4.1. Verticallyintegratedoperators.........................................................................................................84.2. Servingonlyspecificverticalsegments.............................................................................................8

5. Over-the-Top.............................................................................................................................................95.1. TheRoleofNetNeutrality.................................................................................................................95.2. Gamechangers:OTTSVODServices................................................................................................105.3. VirtualRealityandAugmentedReality,360DegreeVideo.............................................................105.4. Whopaysthebill?...........................................................................................................................105.5. OTTServicesarenotbad,theydodrivefibrebusiness..................................................................115.6. CompeteagainstOTTservices........................................................................................................11

6. Levellingtheplayingfield........................................................................................................................126.1. CompetingagainstUSserviceproviders.........................................................................................126.2. FirstCome,TechnologyAdvantages,EconomyofScale,Funding...................................................126.3. FibreTVServicescompetingwithSatelliteReception....................................................................12

6.3.1. Paymentstocollectionsocieties.............................................................................................126.3.2. RetransmissionofFree-To-Airchannels..................................................................................136.3.3. IntegratingPay-TV-Channels...................................................................................................136.3.4. LocalRecordingversusNetworkRecording............................................................................13

7. IncomingRevenues:Wheredoesthemoneycomefrom?.....................................................................157.1. Section“Telco/Inter-OperatorBusiness”......................................................................................15

7.1.1. Ducts........................................................................................................................................157.1.2. DarkFibre................................................................................................................................157.1.3. Wavelength.............................................................................................................................167.1.4. Datalinks(bandwidth).............................................................................................................167.1.5. Housing/Rackspace.................................................................................................................167.1.6. ProvidingBitstreamAccess.....................................................................................................167.1.7. Specialconsiderationsfor3G/4GMobileOperators...............................................................177.1.8. Specialconsiderationsfor5G..................................................................................................17

7.2. Section“BusinessServices”.............................................................................................................177.2.1. Introduction.............................................................................................................................177.2.2. ServicesRequirementsSummary............................................................................................187.2.3. ServiceLevelAgreements........................................................................................................197.2.4. BusinessInternetAccess.........................................................................................................197.2.5. TelephonyServices..................................................................................................................207.2.6. AdvancedDatalinks/LeasedLines...........................................................................................207.2.7. DarkFibre/Wavelength...........................................................................................................207.2.8. Housing/Rackspace.................................................................................................................207.2.9. Hosting/VirtualServers..........................................................................................................207.2.10. StorageServices......................................................................................................................217.2.11. BackupServices.......................................................................................................................227.2.12. SecurityServices......................................................................................................................237.2.13. VirtualizedFirewalls................................................................................................................23

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7.2.14. HostedExchange.....................................................................................................................257.2.15. VirtualDesktop........................................................................................................................267.2.16. VirtualMachines......................................................................................................................277.2.17. ReplicationServicesforVirtualizedMachines.........................................................................28

7.3. Section“Consumers/ResidentialUsers”.........................................................................................287.3.1. Introduction.............................................................................................................................287.3.2. ProductDifferentiation...........................................................................................................297.3.3. InternetServices......................................................................................................................307.3.4. VoiceServices..........................................................................................................................317.3.5. MobileVoiceandData............................................................................................................327.3.6. TVServicesviaHFOverlay.......................................................................................................327.3.7. IPTVServices............................................................................................................................327.3.8. InternetSecurityServicesforResidentialUsers......................................................................417.3.9. CloudStorage..........................................................................................................................427.3.10. Gaming....................................................................................................................................427.3.11. SmartHomeServices...............................................................................................................427.3.12. SmartMetering.......................................................................................................................45

8. TheFifthGenerationMobileNetwork(5G)............................................................................................468.1. Introduction.....................................................................................................................................468.2. Whatis5G?.....................................................................................................................................478.3. Newtechnologiesandopportunities..............................................................................................49

9. TheRoleofIPTVandTVReplayinSwitzerland.......................................................................................509.1. Howeverythingstarted…...............................................................................................................509.2. RetransmissionofTVsignals...........................................................................................................509.3. EasyAdministration.........................................................................................................................509.4. Howeverythingdevelopedsincethen............................................................................................519.5. HugeAmountofIPTraffic...............................................................................................................529.6. Onlyfibrecandeliver......................................................................................................................529.7. ReplayTV–ValueAddedbytheSwissOperators...........................................................................53

10. WeblinksandReferences........................................................................................................................54

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1. Whythisguide?

The growing demand for fibre rollouts all around Europe has gained momentum over the past years.Weestimatethattherearehundredsoffibreprojectsinvariousstagesofcompletionon-goingatthepresenttime.Alloftheseprojectsarebasedonbusinessplanswhichhavetakenintoconsiderationboththecostofbuildingandoperating thenetworks aswell as the incoming revenue streams. TheFTTHCouncil Europeprovidesseveralguidesonhowtoefficientlybuildfibrenetworks.Todayweareverywellawareofthecoststo rollout and operate such networks. In addition the FTTH Council Europe also provides substantialknowhowonhowtofundprojects.

Thisguidefocusesontheincomingrevenuestreams.Andhighlightsthebasicquestion“Wheredoesthemoneycomefrom?”

WhatservicescanbeprovidedusingfibrenetworkstoraisetheARPU?

Whataretherevenuesfrominter-operatorbusinesses?

Whataretherevenuesfrombusinessservices?

Whataretherevenuesfromservicesforresidentialusers?

Whatistheimpactofmobilenetworks,lookingforwardalsoto5G?

Whatistheimpactoftoday’sOTTSVODservicesonfuturerevenuestreams?

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2. Foreword

WelcometothefirsteditionoftheServicesandApplicationsGuide.

Fibrenetworksofferthebandwidthforanimmenserangeandnumberofservicesandapplications;toanextentthatwasunimaginableafewyearsago.

Theintentionofthisguideistogroupalltheseapplicationsandlisttheonesthataremostrelevant.Someapplicationsarealreadyhighlyrelevanttoday,butrarelyseenfromtheoperator’sperspective.Wewillfocusalittlemoreonthese.

Fibrenetworksarechangingthewaycompaniesbuild,structureandoperatetheir IT infrastructuresthusimpacting heavily on traditionally classic IT system integrations. Should they backup or replicate theirbusinessdata todistant locations?Cantheyaddstorageservicesondemand?Distribute theirenterpriseapplicationsonvirtualservers,someonsite,someoperatedremotelybyserviceproviders.Shareapplicationswiththeircustomersandsuppliers.Preparefordisasterrecoveryintheeventofransomwareattacks.Thereisanextensiverangeofoptionsthatsmartoperatorscanconsiderwhendevelopingnewbusinessoptions,andthesearenotlimitedtobandwidthsandinternetaccess.

Someserviceswillbeprovidedover-the-top.Otherswillinvolveadegreeoftrustbetweeninterestedparties.Somewillrequirerelativelyshortdistanceswhileothersneedaverylowlatency.Operatorsneedtobeawareof their own strengths and how to position themselves. There is a large number of options that can beavailableregionallyandlocally.

Thisisalsotrueforservicestoresidentialusers.Itisnotjustaboutinternet.ThereisalargenumberofOTTSVODservicesavailable,that“just”requireacertainfibrebandwidth,buttherearealsoservicesthattheoperators shall provide on their own. Indeed there are several reasons why operators should considerprovidingthoseservicesthemselves.Onesuchreasoncanbeatrustrelationshipforsmarthomeapplications,anothercouldbenetneutralityregulationsthatpreferaspecificoperatoroverotherswhenprovidingTVservices.Cleverbundlingmightbeanothermotive.

Theintentionofthisguideistohighlightnewbusinessopportunitiesthatyoumaynotyethaveconsidered.

Theaimistothinkaboutwhatcanbedone;andtothinkaboutnewincomingrevenuestreams.

HansKühbergerChairofWorldofApplicationCommitteeFTTHCouncilEurope

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3. Acknowledgements

ThisServicesandApplicationsGuidehasbeenproducedbytheFTTHCouncilEuropeanddrawsheavilyonthe expertise of itsmember organisations.We thank the following individuals for their time, effort andcontributions,andacknowledgetheiroriginalmaterialandgraphics,whichhavebeenincludedinthisguide:

HansKühberger,Ocilion(ChairoftheWorldofApplicationsCommittee)

BernhardSchuster,Infotech(BusinessServices)

JohannesWagner-Meingassner,Infotech(BusinessServices)

DorisBriedl,Infotech(BusinessServices)

DominiqueReiter,Ocilion(IPTVServices)

EvaButtinger,Ocilion(IPTVServices)

LaszloGyalog,Nokia(SmartHomeServices)

GerhardKafka(5GMobileNetworks)

JürgCaluori,Ocilion(TheRoleofIPTVandTVReplayinSwitzerland)

TheServicesandApplicationsGuided isan initiativeoftheWorldofApplicationsCommitteeoftheFTTHCouncilEurope.

ContributionsweremanagedbyMichaelaFischer,ProjectManager.

AlleditionswereeditedbyEileenConnollyBull,ConnollyCommunicationAB.

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4. OperatorModelsandRevenueSplits

Thisguidewillconsiderallfibrenetworkrevenuestreams,regardlessoftheverticalmodel.

4.1. VerticallyintegratedoperatorsIfanetworkoperatorisverticallyintegrated,heisbuildingthepassivenetwork,runningthenetworklayerandalsoprovidingtheservices.Thusallrevenuestreamspresentedinthisguidearerelevant.

4.2. Servingonlyspecificverticalsegments

Ifthenetworkoperatorisonlybuildingoroperatingspecificverticalsegmentsofthenetwork,thenonlytherespectivepartsofthisguideshouldbeconsidered.Verticalsegmentscanbe:

• PassiveNetwork(building,ducts,fibre)• ActiveNetwork(“enlightening”thefibre,connectingconsumerswithserviceproviders)• ServiceProviders(deliveringandoperatingtheapplications)

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5. Over-the-Top

Many servicesnowadays canbedeliveredover-the-top (OTT) -meaningon topofany standard internetaccess.Intheeventofanover-the-topmodel,theOTTserviceproviderisconnectedtotheinternetanywhereintheworldandtheonlycustomerrelationshipofsuchanOTTserviceprovideriswiththeconsumer.TherearenocontractualrelationshipsbetweentheOTTserviceproviderandthenetworkoperator.

Figure1:OTTBusinessRelationsandTrafficFlow.Source:Ocilion

OTTiscertainlynotlimitedtoSVODservices.SIPtelephonycanbedeliveredover-the-top.CloudstoragecanbeaccessedviainternetandisthereforealsoanOTTservice.Indeedmostservicesthatcanbesubscribedtoonthenet,areOTTservices.Thisiswhatmakestheinternetsosuccessful.

5.1. TheRoleofNetNeutralityOTT services are subject to net neutrality rules. A network operator is not allowed to apply transportadvantages(priority)ortransportdisadvantagestospecificservices.Allserviceshavetobeservedequally.Thisisnotaproblemformostservicesasthemajorityofthemdeliverdatamoreorlessoccasionallyandarethereforenotdependentonguaranteeddelivery.

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5.2. Gamechangers:OTTSVODServices

However,theriseofOTTfreeorsubscriptionvideoondemandservicesoverthelastfewyearshaschangedthe game. Services such as YouTube, Netflix or Amazon Prime Instant Video require substantially highbandwidthforhours,evenseveraldaysaweek.

Figure2:Internetusageofatypicalhousehold,rightbeforetheOTTSVODhypestarted.Source:Infotech

Figure3:TypicalinternetusagewithOTTSVODusagepatterns.Source:Infotech

5.3. VirtualRealityandAugmentedReality,360DegreeVideo

Virtualreality,augmentedrealityandmixedreality,aswellas360degreevideoarenewvideooptionsthatcombinevideodeliverywithdevicesensors(location/direction).SomeoftheseareexpectedtobeavailableonoperatorprovidedIPTV,like360degreeforsportstransmissions;howeverthemajoritywillbedeliveredover-the-top.Theseserviceshaveahighbandwidthdemand(andlowlatency)hencewillhaveahugeimpactonthenetwork.

5.4. Whopaysthebill?

Thesenewusagepatternsdriveupthecostofpurchasefortheoperator.Hewillneedtoincreasehisownupstream bandwidth connections; and therefore be forced to reduce internet overbooking. Both thesefactorsarehighlyrelevantpurchasecalculationsofinternetserviceproviders.

Amatter that has beendiscussed extensively iswhy the operator has to pay the bill for the newusagepatterns,whentheOTTservicesproviderdoesn’t–eventhoughitisonlytheOTTserviceproviderthatisearningmoneywithsuchdeliveries.Thisistheresultofthelastyear’snetneutralitydiscussionsandistodaypartofEUregulations.

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5.5. OTTServicesarenotbad,theydodrivefibrebusinessHavingtakenacloserlook,itisclearthatOTTdoesnotjustdriveupthecostofpurchase,butalsodrivesthefibrebusinessintotal.OTTboostsboth,fibretakeupratesaswellastheaveragerevenueperuser:

• AttractivevideoservicessuchasYouTube,NetflixorAmazonPrimeInstantVideoare,inmanycases,the primary or sometimes even the only reason for consumers to connect to fibre networks.Thereforesuchservicesarehighlyrelevantconsideringthetakeuprate.

• Consumerspayfortheinternetaccessandmayalsowishtoupgradetoamorepowerfulpackage.

5.6. CompeteagainstOTTservices

However,OTTservicescanalsocompeteagainsttheoperators’ownservices.Andinmanycasesitdoesseemdifficult for a regional service operator to keep upwith big companies like Amazon,Netflix, Google andothers.

Inmanycasestherearegoodreasonsforconsumerstoselecttheservicesofferedbyregionaloperators,anditisuptotheoperatorhimselftohelpconsumersunderstandandseetheadvantages:

• For some services there are exclusions from net neutrality, such as TV services.OperatorsareexpectedtodeliverTVinguaranteedquality;thisisaclearadvantageagainstOTT.

• For some services, especially those related to the business sector, the short distance to alocal/regionaloperatorisabigadvantage.Fibrechannelservicesforexample,haveaclearlimitationindistance.Backupandstorageservicessometimesneeddedicatedbandwidthsandguaranteedlowlatency;thesecanbedeliveredmuchmorecostefficientlyfromalocal/regionaloperator

• Considerthetrustrelationshipofalocal/regionaloperator.Whomwouldyouasktostoreorbackupyoursensibledata,ifyouareabletochoose?

• Inaddition,insomestateslegislationisinplacethatforcesserviceproviderstograntaccesstoitssecretservicestooperator’sdatavaults.ServiceslocatedintheUSAarenotasafehavenforyourdata.

• Sometimescustomersexplicitly select servicesavailable from local/regionaloperators inorder toraisetheoperatorsARPU,thushelpingoperatorstocommittoinstallingfibreinnewregions.

Thisguidelistsvariousservicesthatcanbedeliveredbylocal/regionaloperators.Byputtingyourselfintotheshoes of your customer you are able to imagine what would make him choose your services above acompetitor.

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6. Levellingtheplayingfield

6.1. CompetingagainstUSserviceproviders

InmanycasesEuropeanserviceproviders–alsolocal/regionaloperators–findthemselvesboundbylawsandregulationsthatputthematadisadvantagetoUSoverseasserviceoperatorswhoarenot limitedbysimilar restraints. Thismeans that European andUS services operate under different conditions. FromaEuropeanpointofview,itwouldseemthatUSservicesareoftenadvantaged.

European service providers may find they are disadvantaged through existing data privacy regulations.Serviceswhichcollateuserpatternsandcollectusers’privatedatacancombinesuchdataforfurtherdeepanalysisthusprovidingveryaccuraterecommendations,evencrossmarket(likeAmazoninmarketplace,musicandvideoservices).

However,asmentionedabove,thestricterEuropeandataprivacyregulationscanalsobethereasonwhyEuropeanservicesandinparticularservicesprovidedbylocal/regionaloperatorsshouldbeconsidered.It’snotalwaysblackorwhite.

6.2. FirstCome,TechnologyAdvantages,EconomyofScale,Funding

SometimesitisnotexistinglegislationthatgivesadvantagestoUSserviceproviders,butsimplythefactthatthoseserviceprovidersbeganofferingtheirservicesmuchearlierandhavebeenabletofurtherdeveloptheirtechnologicalexpertise.Theyhavealsobeenabletomakeuseofeconomyofscaleandmostprobablyhaveeasieraccesstofunding.Theresultisthatitwouldbeextremelydifficulttobreakintothosemarketswithnewcompetingservices.ExamplesforUSserviceprovidersaresearchengines(Google),voicerecognition(Amazonsecho),andsubscriptionvideoondemandservices(Netflix,AmazonPrimeInstantVideo).

6.3. FibreTVServicescompetingwithSatelliteReception

WhyshouldhouseholdspayforfibredeliveredTVserviceswhenTVreceptionfromsatelliteisavailableforfreeinmanycountriessuchasinGermanspeakingcountries?

CableoperatorshavebeenprovidingTV services fordecades.Usually theyhave focusedonurbanareaswhereitisdifficultoroftenevenprohibitedforhouseholdstomounttheirownsatellitedishes.

However,inruralareas,householdsalreadyreceiveTVfromsatellite,sowhenbuildingfibreintheseareasitisverydifficulttoconvinceresidentialuserstoswitchfromfreesatellitereceptiontoafibredeliveredTVservice,forwhichtheyhavetopay.FormostEuropeanoperators,pushingtheirnetworksintoruralareas,meanstheyoftenfindthemselvesina“competitionagainstzerocost”situation.ThisisespeciallytrueinruralareaswhereitisveryimportanttomakeuseofanyopportunitytoraisetheARPUtocoverthehighercostofbuildingthenetworks-highercostsduetolongerdistancesinruralareas.

6.3.1. Paymentstocollectionsocieties

NetworkoperatorsareobligatedtopaymonthlyfeespersubscriberforTVretransmissions.Satelliteoperatorsdonot.

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6.3.2. RetransmissionofFree-To-Airchannels

Network operators have to sign retransmission agreements for each channel or group of channels, andsometimesevenhavetopayforchannelsthatareavailablefreeofchargeviasatellite.Also,smalloperatorshavedifficultyinbeinggrantedretransmissionagreements.

Youmayaskifthereisanychanceofsolvingthisproblem.Perhapsyes!IfwelooktowardsSwitzerlandwhereall FTA channels can be retransmitted by a network operator without having to sign retransmissionagreements.Operatorsarerequiredtopayaretransmissionfeetothecollectionsocieties,whichisequalforanyoperatorinSwitzerland,bothsmallandlarge.

6.3.3. IntegratingPay-TV-Channels

WhileitisreasonablyeasytoretransmitencryptedpayTVchannelsoncablenetworks,itcanbequitedifficulttointegratepayTVchannelsintoIPTVservicechannelline-ups.Asalwaysitisamatterofscale;andonceagain,especiallydifficultforsmalleroperators.UsuallytheincumbentoperatorsarealreadywellintegratedwiththepayTVoperators,makingitevenmoredifficultforsmalleroperatorstocompete.

How can this situation be resolved? The solution may be that pay TV operators provide standardizedprovisioninginterfaces,rulesandprocedures,andhaveanopenready-to-distributepolicy.

6.3.4. LocalRecordingversusNetworkRecording

Anyhomeusercanutilisehispersonalvideorecordertorecord(andreplay)TVshows.Thelegalframeworkforthisiscalled“homecopy”.HarddiskrecordersaremainlyproducedintheFarEast,whichmeansthereisverylittlevalueaddinEurope.

Inthiscontexttheterm“networkrecording”meansthattheTVshowisnolongerrecordedathomeandinsteadoccursinthedatacentreoftheTVserviceprovider.Therecordingitselfdoesnotdifferfromtheonerecordedathome.

Ofcourse,similartothatoftheITsector,stateoftheartstoragesystemsareneededandtechniques,suchas“deduplication”allowforefficientprocessingoftherecordings.Deduplicationsimplymeans,thatif100householdsrecordthesamespecificTVprogramme,it isnotphysicallyrecorded100timesbutonlyoncewith100referencepointstowardsthatsharedcopy.Thisresultsinasavingofhardwareresourcesaswellasenergy,andinadditioniscompletelyinvisibletotheconsumerwhostillsees“hisownprivaterecording”.

Thisallsoundsrelativelyeasy,butitisn’t.InmanyEuropeancountriesnetworkrecordingisstillnotanaturalfollow-uptothepersonalrecorder.WhilenetworkrecordingneedsafibrenetworktoreplaytherecordingintopHDquality,andwhilenetworkrecordinghasanalmost100%valueaddinEurope,therearestillmanylegal obstacles in the way. For example, the legislation in some countries does not allow deduplication(sharedcopy),andsomedonotallownetworkrecordingatall.

Inthemeantime,millionsofharddiskrecordersareimportedfromtheFarEasteveryyear.Theseharddiskrecordersrepresentahugeinvestment,whichcouldbeeasilydivertedtofibrerollout.Networkrecordingandfibrenetworkswouldthenbelogicalpartnerstopushbroadbandrollout.

IfwereturntoSwitzerlandonceagain.In2009itwasdecidedthatlocalrecordingsandnetworkrecordingsshouldbetreatedequally.Sincethen,Swissoperatorshavebeenobligedtopayacopyrightfeeeverymonth

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tocoverthosehouseholdsusingrecordingservices;thisisregardlessofwhetheritwasrecordedlocallyorcentrally.Deduplicationisincluded,ofcourse.

Finally,networkrecordingsprovidebetterrecordingfeaturesthanlocalrecordings.

- Advantagesforend-user:o MultipleconcurrentRecordings

§ Whenrecordingontheset-topbox,thenumberofchannelsthatcanberecordedsimultaneously is limitedtothenumberoftuners intheset-topbox,ortheextrabandwidthavailablebesidethechannelthatiscurrentlybeingviewed.

§ Withnetworkrecordingthiscanbeunlimited.Forexample,intheNetherlands,KPNoffersupto6simultaneousrecordings

o MultiroomRecording§ Allset-topboxes(andallmobiledevices)inahouseholdcanrecordandplaybackthe

sameTVrecordings.Forexample,startreplayinginthelivingroom,continueinthebedroom.

- Advantagesfortheserviceprovidero Saveonoperationalcosts

§ Statistically, 5% of the hard disks in set-top boxes fail per year and need to bereplaced

o Generateadditionalrevenues(e.g.KPNintheNetherlandschargesanextra5EUR/month)

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7. IncomingRevenues:Wheredoesthemoneycomefrom?

Thischaptergroupsandlistsseveralservicesandapplicationsthatcangeneraterevenuesforoperators.

Thechapterisgroupedintothefollowsections

a) Telco/Inter-Operator-Businessb) BusinessServicesc) ResidentialServices

Someservicescaneasilybeprovidedbytheoperatorhimself,somearequitecomplextobuildandevenmorecomplextorun.

Itisalwaysbesttoconsiderwhethertomakeorbuy.Complexservicescanrunontheoperators’ownserversintheirdatacentrewhichiswellconnectedtotheirownfibrenetwork,andstillbebuiltandoperatedbyasupplier.

7.1. Section“Telco/Inter-OperatorBusiness”Anoperatorprovidesservicestoanotheroperator.Inthissectiontheterm“customer”referstotheotheroperator.

Pleasenotethatpurepassivecomponentsalsorequireaservicelevelagreement.Ininter-operator-businesseshighavailabilityisusuallyarequirement.

7.1.1. Ducts

Theoperatorownsavailableductsystemswithinitsserviceregionandiswillingtorentsomeorpartsoftheductsonamonthly/annualbasistothecustomer.

Itistheresponsibilityofthecustomertoinstallfibreunitsorfibrecablesintotheducts.

Rentalofductsmayalsorequireaccesstostreetcabinetsorhousingcentres.

7.1.2. DarkFibre

Theoperatorhasfibreunitsorfibrecableswithinitsserviceregionandiswillingtorentsomefibresforamonthly/annualfeetothecustomer.

Darkfibremeans“withoutactivenetworkingequipment”.Thismeansthecustomerhastolightthefibrewithhisownequipment.

Rentingfibremayalsorequireaccesstostreetcabinetsorhousingcentres,andinadditiontheneedtorentrackspaceforthecustomers’activecomponents.

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7.1.3. Wavelength

Wherethereisashortageoffibreandwherethecustomersarerequiredtoruntheirownactivenetworkingequipment,theoperatorcanoffertorentoutmultiplewavelengthsforamonthly/annualfee.

Theoperatorcanmultiplythecapacityofadarkfibrebyprovidingopticalsplittersonbothends.Laserswithselectedwavelengthscanthentransmitdataparallelandindependentofeachother.

Thismakesitnecessaryforthecustomerstoruntheirownactivenetworkcomponents,asinthecaseofthedarkfibre.

Asmentionedabove,rentingwavelengthsmayalsoresultintheneedtoaccessstreetcabinetsorhousingcentres,thusrequiringthecustomertorentrackspacefortheiractivecomponents.

7.1.4. Datalinks(bandwidth)

Theoperatorprovidesadatalinkinvolvingcertaintechnicalparameterssuchasbandwidth,maximumroundtriptime,jitter,committedinformationrate(CIR)andinterfacestothecustomerforamonthlyfee.

Thehigherthedataratesandthehigherthetechnicalrequirements,thehigherthemonthlyfee.

Using data links instead of dark fibre or wavelengths does make sense if the bandwidth/technicalrequirementsarecomparablylow,ifthecustomercannotordoesnotwishtorunitsownactivecomponentsduetocommercialortechnicalreasons,orsimplyiftherearenodarkfibreorwavelengthsavailable.

7.1.5. Housing/Rackspace

The operator provides housing capacity/rack space to the customer for a monthly/annual fee.Housingcapacityorrackspacecanbeprovidedindatacentresorinstreetcabinets.

Theterm“housing”isusedforoneormultiplefull/halfracks.

Theterm“rackspace”usuallyreferstorelativelylowdemands.Ametricrackunitis44mmandafullrackoffers40-45rackunits.

Providing housing capacity/rack space results in physical access to the datacentre/cabinet withaccompanyingrulesinplace.Housingandaccessalsoresultinextendedsecuritymeasuresthatincludevideomonitoring.

Inadditiontothehousingcapacity/rackspace,theoperatorhastoprovideuninterruptableelectricalpower,cooling,physicalsecurityandofcourseaccesstooutgoingdatalinks/wavelengths/fibres/ducts.

7.1.6. ProvidingBitstreamAccess

Theterm“bitstreamaccess”isusedtodescribeahighlystandardizedandefficientdeliveryofIPdatafromcentralbackhaulinterfacestomultipleendpointaccessinterfacesaimedatresidentialandbusinessusers.Eachendpointisassignedaprofiledescribingthetechnicalparameters,includingbandwidthandqualityofservice.

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Theoperatorprovidesbitstreamaccesstoendpointsagainstamonthlyfeeperendpoint.Thesizeofthefeedepending on the profiles selected. The operator also provides central backhaul connectivity against amonthlyfee,basedonthenumberandtypeofrequiredbackhaulinterfaces(e.g.10Giginterfaces).

Theterm“virtualunbundling”canbeusedinsteadof“bitstreamaccess”.

End-useraccesslinescouldbefibre–bothpoint-to-pointandGPON–aswellasADSL/VDSLcopperlines.Thetermisusedforwirelineconnectionsonly.

7.1.7. Specialconsiderationsfor3G/4GMobileOperators

Thereareanumberofspecialconsiderationsifthecustomerisamobileoperator.

Mobileoperators have to connect their distributedwireless infrastructurewith their central routers andswitches. There are a relatively low number of antenna locations for 3G/4G networks, as the requiredbandwidthperantennalocation,comparedto5G,isstilllow.Previously,mobileoperatorsusedprofessionalwirelesslinkstoconnectthistypeofantennalocation,howevertheyaremovingmoreandmoretowardsfibre wireline connections. Operators can rent ducts, dark fibre, wavelengths or data links to mobileoperators.Itisexpectedthatinthecomingyearsallmobileoperatorswillgofor5G.

7.1.8. Specialconsiderationsfor5G

Comparedto3G/4G,thenextgenerationofmobilenetworks–5G–doesrequirehigherbandwidthsandasubstantiallyhighernumberofantennalocations.Bothhigherbandwidthandincreasedantennalocationsmakeitmoredifficulttorunprofessionalwirelesslinks.Finallyonlyfibrecandelivertherequiredbandwidthanddensity.5GhasabigoverlapwithFTTHnetworks,asitnotonlyrequireshigherantennadensitythusgeneratinghigher rental fees for theprovisionofbackhaulaccess to theantennas, italsocompetes toacertain extent with direct FTTH internet access residential user revenues. Residential users that do notrequirethefullFTTHbandwidthpowermayfinditsufficientusinga5Gwirelesslinkinstead.

Seealsochapter8,specialconsiderationsfor5G.

7.2. Section“BusinessServices”

7.2.1. Introduction

Longbeforerealfibre-to-the-homewaseventalkedabout,businessesandenterprisesrequiredbandwidth,securityandavailabilitythatcouldonlybeprovidedbyfibre.Soitisnotsurprisingthattodaythereexistsabroadrangeofbusinessservicesthatgeneraterevenuesfornetworkandserviceoperators.

ThesebusinessservicesareconsumingagrowingmarketsharefromthepreviouslytraditionalITbusinesssector.

Fileservers,backup,securityandmanyotherserviceswhichhad,uptoafewyearsago,beenrunningusingthecompany’sownserversandoperatedbytheirownstaff,arenowmorelikelytobeoperator-servicesthatabusinesscansubscribetoondemand.Previouslybusinessesinvestedinhardwareandlicensesoftware,nowtheyspendthemoneyonmonthlyfeesfortheirchosenservices.

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Thisopensupanewandexcitingmarketshareforoperatorsandoffersfantasticopportunitiesforgrowth.Evenifthesebusinessservicesareprovidedbyotherserviceoperators,theystillrequirehighbandwidths,lowlatencyandhighavailability–capabilitiesonlyfibrecandeliver.

7.2.2. ServicesRequirementsSummary

Accessingtheinternet

Uponcloserconsideration,thebasicrequirementforinternetaccessforacompanyisnotthatbasicanymore.Highavailability,servicelevelagreements,redundantfibrelinks,evenmulti-homedinternetaccess,arejustsomeofthemanyoptionsavailable.Thegoodnewsis,onlyfibrecandeliver.

CompanyInternalMultisiteNetworks–ConnectingCompanySites

Basic point-to-point ormore sophisticatedprivatemultipointnetworks are still commonly used,offeringinboundsecurity,welldefinedandguaranteedbandwidthaswellasround-tripcapabilities,allregardlessofthe internetusageofanyoneoutside thecompany.However thosedirect linksdocomeataprice.Thustoday,theyaremoreoftenbeingreplacedbyVPNsite-to-sitelinks,requiringjusta“normal”internetlinkontheleftandrighthandside.VPNsbydesigndonotprovideguaranteedbandwidth,norguaranteedround-triptimes,andtheyarejustassecureastheVPNdevicesandstandardsandconfigurationsused.Andtheydoneedhighbandwidthinternetaccessonallsites.

StorageandBackup

Being able to provide high bandwidth accessmakes it possible for servers and storages to be physicallylocatednotonlywithintheinternalnetwork,butalsoatanyotherlocationoutsidethecompany.Onlyfibrelinksprovidethe100megabits,thegigabitsandthe10gigabitlinksthatarenecessarytoallowsuchscenariostodevelopandgrow.Alwaysrelevantinsuchconsiderationsaresecurityandavailability.Securitynotonlyaddresstheobviousthreatsbyhackers,butalsothreatsbyothercountriessecretservices.ItiswisetobearinmindtheveryrecentdiscussionsregardingMicrosoftbeingforcedbyUSagenciestoprovideaccesstocustomers’datavaultswith theaimof fighting terrorism.EdwardSnowdenshouldalsobe remembered.Europeandatacentreschanged their services to include“Stored in theEU”,andoften the localnetworkoperatorhasamuchbettertrustrelationshipwiththecustomerthananyglobalplayeroranonymousstoragehost.Regardingavailability,ithasbecomeobviousthatarelativelyshortlinktothelocaloperatorusuallymeansfeweroptionstofailthanalinktoaproviderlocatedattheotherendoftheworld.Soinbothaspects,securityandavailability,thelocaloperatorsquiteoftenoffersubstantialadvantagesinbeingthebettertrustpartnerintermsofstorage,backup,remoteserversandsecurity.NetworkoperatorsthatcancombinetheirnetworkingresourcesandtheirITstorage,backupandcomputationalresourcesintofullypackedservicesusuallydoaverygoodjob,thusmakingitdifficultforinternationalconglomeratestocompete.

Capacityondemand

Cloudbasedstorage,backupandcomputationalresourcescanbechosenondemand;makingitpossible,ifandwhenneeded,todoublestoragecapacitiesatshortnoticeoraddcomputationalpowerforextensivecalculations that are necessary for a short period of time; or backup to a remote site providing enoughcapacity whenever it is needed. All of these services require extensive bandwidth for cloud serviceconnection.Highbandwidth,lowlatencyandhighavailabilityareonlypossibleusingfibre.

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AnyPlace,AnyTime,AnyDevice

Accessingbusinessapplicationsfromanyplaceatanytimeusinganydevicearerequirementsofagrowingnumberofenterprises.Eithertheenterprisechoosestobuyvirtualdesktopsfromthecloud,oralternatively,runsitsowncloudservices,butasalwaysitisonlyfibrethatcandeliver.

7.2.3. ServiceLevelAgreements

Businesses are very dependent on connectivity and insist on high availability and explicit service levelagreements.Operatorsneedtobepreparedtomeetthesegrowingdemands.Servicesaremoreexpensiveif higher service level agreements are requested,or if the level of services in an agreement are chargedseparately.

Exampleofdifferentiationofvariousservicelevels:

Bronze Silver Gold PlatinumContactHours Mo-Fr07:30-17:00 Mo-Fr07.30-19:00 Mo-Sa07:30-19:00 Mo-So00:00-24:00Availability 99,30% 99,50% 99,70% 99,90%ResponseTime <=4h <=4h <=3h <=2hUpfrontinfotomaintenancewindows

1day 3days 7days 7days

Repairoutsidecontacthours

ExtraCharge ExtraCharge ExtraCharge Included

7.2.4. BusinessInternetAccess

Manysmallerbusinessesoftenraisethequestionastowhytheyarechargedahigherrateforinternetaccessthanaresidentialcustomer,eventhoughbothhaveaccesstothesamebandwidth.

Howcanbusinessinternetaccessbedifferentiatedfromresidentialinternetaccess?

Inreality,mostbusinesseshavesubstantiallyhigherrequirementstowardsinternetaccessthanresidentialusers.Theyareoftenpreparedtopayapremiumiftheirhigherrequirementsareaddressedandfulfilled.Operatorsneedtobepreparedtofulfilthesehigherrequirements.Suchrequirementscaninclude:

• ProfessionalNetworkterminationdevices(CPE)• Bandwidthupstream/downstream• Symmetricaccess• DatatransmissionPolicy(unlimited,fair-use,includedtransmissionvolumeinGB/TB)• IncludedofficialIPaddresses• Guaranteedavailability/ServiceLevelAgreements• Redundantfibrelinksforpremiumavailability• Multihomedaccess(independentBGPAS)• Technology(forexample,point-to-pointinsteadofGPONforresidentialuser)• Lowerlatency• Monitoring/Alerting• IncludedIPservices(email,domainnameservices,webspace)• Add-onservices,suchassecurity,securemail,securewebetc.

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7.2.5. TelephonyServices

Alargenumberofbusinessesandenterprisesstillmaintainanextensivenumberofwirelinecalls.

Operators canprovidewireline telephony services via fibre linkonamonthlybasiswithadditional voiceminutecharges.

TelephonyservicesthathavebeendeliveredviaPOTS/ISDNinterfacespreviously,arenowadaysbasedonIPSIPprotocolsandSIPtrunks.

Operators can provide the voice links only, or alternatively extended telephony services that include acompletevirtualizedvoiceswitchboard.

7.2.6. AdvancedDatalinks/LeasedLines

Operatorsprovideprivatedata links toconnectcompanysitesor toconnectonecompanywithexternalbusinesspartners.

Privatedata links areprovidedonamonthly feebasis,with thepricedependingonparameters such asbandwidth upstream and downstream, committed information rate (CIR), committedmaximum latency,availability,technicalinterfacesetc.

Privatedatalinkscanbepoint-to-pointoramultipointmesh.

Privatedatalinksarecompletelyisolatedfrominternettraffic.

7.2.7. DarkFibre/Wavelength

Sometimesbusinessesrequiredarkfibreconnectionsorevenprivatewavelengths.

Oneexampleisafibrechannelcross-siteconnectionthatiscommonlyusedforstoragesystems.

Thereforeoperatorsneedtobereadytoprovidedarkfibreorwavelengthsforamonthlyfee.

7.2.8. Housing/Rackspace

Businessesalsoaskforexternalhousing,forexample,torunareplicatedstoragesystematasafedistancefromthecompany’sheadoffice.

Thisinvolvesthesamerulesandparametersasprovidinghousing/rackspacetotelcos.

7.2.9. Hosting/VirtualServers

Hosting involvesanoperator running specific services (e.g. aweb servicesora virtual server session)onoperatorownedhardware.Customerspaypermonthandservice,dependingonfeatureandcapacity.

Operatorscanrunmultiplehostingservicesoneachindividualserver,sorentingahostedserviceisusuallymuchlessexpensivethanbuying/rentingthefullserver.

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For security or availability reasons businesses are interested in running specific applications on separatevirtualizedserverinstances.Suchapplicationsdonotoftenrequireextensiveresourcesbuttheyneedtoruninaseparate“sandbox”.Operatorscanprovidethenecessaryvirtualizedserverinstancesatamonthlyrate,basedonallocatedCPU,RAM,diskandnetworkingresources.

7.2.10. StorageServices

Operatorsprovidediskstoragecapacityondemand.

Businessespayamonthlyrate,dependingoncapacityandtechnicalparameters.

Pricingmainlydependsonstoragetechnologyused:Superfast,solid-statedisks(SSD)aremoreexpensivethantraditionalSATAdisks.ArchivetypestoragemayonlyrequirecheaperSATAdisks,whilstothersarebestservedwithSSDspeed.

Theuseofdeduplicationtechnologyincreasestheefficiencyofstoragespaceusage,asitsavesthesamefileonlyonce.

Storagecanbeprovidedtoaclient’sprivateinterfaceortothepublicinternet.

Private storagemay be used to replicate internal data or to backup internal data to external locations,withoutrunningintointernet-likesecuritythreats.

Storagecanalsobeprovidedtoanyauthorizedclientonthepublicinternet,combiningtheflexibilityofcloudstoragewiththeaccess-from-anywherefeature.

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7.2.11. BackupServices

Theoperatorprovidesbackup-as-a-service to the client companyand replacesonsite tape-basedbackupsolutions. The client only has to install encryption client software to the relevant servers and setup theencryptionkey.Wheneverabackuporrecoveryisrequested,thedatawillalreadybeencryptedattheclient’sserver and only leaves the company as an encrypted version. Operators do not know theencryption/decryptionkeys.

Backupscanbediskbasedortapelibraryrobotsbased.

Backups canbemulti-staged, for example, diskbasedovernight from the clients server to theoperatorsbackupstoragevaultandfurtherreplicatedtotapeonathirdlocation.

Figure4:MultistageBackupasaService.Source:Infotech

Companies look for operators whom they can trust both in availability and security perspective, andlocal/regionaloperatorsusuallyhaveaveryhightrustrelationshipwithcustomers.

CompaniesseekbackupservicesintheirownstateoratleastwithinEurope.

Somecompanieshaveonlyveryshortdailyoperationalwindowsforbackupthustheymaypreferthemulti-stagedapproachwherestage1isarapiddisk-to-diskcopyprocedure.

Anumberofcompaniesrequire“continuousoperationwhilebackup”features,iftheoperationrequiresa24hperdayuptimenobackupwindowmaybeavailableatall.

Companiesmayaskforbackupofservers,butcanalsoaskforclientbackups.

Acompanymayaskatanytimeforarecallofoperatorbackedupfiles.

Companiescanselecttheminimumnumberoffileversionsortheminimumnumberofdaysabackupshallbeavailable,whichineffectmeanstheyhaveacustomisedservice.

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7.2.12. SecurityServices

Demandforsecurityservicesisveryhighandinsomecasesitmakessensetohavethemoutsourced,butataclosedistance.Thisisanotherrevenueopportunityforoperators.

7.2.13. VirtualizedFirewalls

Operatorscanrunvirtualizedfirewallstoprotectcompanyserversfromoutsidethreats.

7.2.13.1. ApplicationGateways/SecureMail

Operatorscanprovideapplicationgatewaystosecureacustomers’incomingandoutgoingemailtraffic.

Unprotectedincomingemailsareamajorsecuritythreatforanycompanyanddefinitelyneedtobecovered,eitherinternallyorbyanexternalSecureMailservice.

Figure5:EmailSecurityasaService.Source:Infotech

CurrentSecureMailservicesincludeaseriesofprotectionmechanismsthatpassthroughanyincomingmailinanautomatedworkflow.Identifiedthreatsareeitherdeletedorquarantined.

Featuresavailablearevirusprotection,spamprotection,malwareprotectionetc.

Optionalfeaturesareemailsignatureandemailencryption.

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7.2.13.2. ApplicationGateways/SecureWeb

Operatorscanrunanapplicationgatewayforoutgoingclientwebrequests.

This type of application gateway can run on real-time URL filters both for security reasons (avoidsdownloading/accessingsecuritycriticalcontent)andtoenforcecompanywebusagepolicies.Suchpoliciescan,forexample,blockpornographiccontentorlimitusageofsocialmediatocertaintimesduringtheday.

Furtherfeaturesthatcanbeincludedare:

• ApplicationVisibilityandControl• Virusscanners• Reputation-BasedMalwareProtection• Time-BasedPolicies• ProxyCaching• User-BasedRules • ActiveDirectoryIntegration

Figure6:WebSecurityasaService.Source:Infotech

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7.2.13.3. Authenticationservices

Operatorscanruntoken-basedauthenticationservicestoenforceenhancedaccesscontrol.

Companiesrelyonsecureaccesstocompanyresourcesandsometimesneedstrongauthenticationmeasuresinplace;authenticationthatgoesfarbeyondsimpleusername/passwordcredentials.Extendedtoken-basedsecuritycanalsobeimplementedasaservice.

Onceauthenticationhasbeenconfirmed,datatransmissionisprotectedbystrongVPNencryption.

Figure7:AuthenticationasaService.Source:Infotech

Togainaccess,usersarerequiredtosigninwithpasswordandtoken.Tokensareprovidedbyhardware(suchasRSAsecuretokens),byapp(mobile)orcanbeSMS-deliveredandarealwaysdynamicallygeneratedandhavealifespanofafewminutesonly.

Figure8:AuthenticationDevices,Messages,Apps.Source:Infotech

7.2.14. HostedExchange

OperatorscanrunahostedversionofMicrosoftExchangechargingamonthlyfee,peraccount.

CompaniescanhaveaccesstoallfeaturesofMicrosoft’swellknownemailmessagingsystem,fromallrelevantclients.

HostedExchangecanbesuccessfullycombinedwithSecureMailservices.

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7.2.15. VirtualDesktop

OperatorscanrunavirtualdesktopservicebasedonMicrosoftorCitrixSoftwareTechnology.Servicesarebilledperaccountandnumberofmonths.Applicationsoftwarelicensingcanbeincluded.

Thevirtualdesktopcanbeopenedanytime,anyplaceandonvirtuallyanydevice.Virtualdesktopsarelinkedtovirtualserversandstorageandtheseservicesnotonlyprovideapplications,butalsothecustomer’sdata.

Abackupserviceforthecompany’sdatacanalsobeadded.

Virtualdesktopsolutionsfurtherallowforflexiblescalingfrom1tothousandsofusers,negatingtheneedtore-dimensionthecompany’sinternalserverinfrastructure.

Virtualdesktopsolutionsaresecure,asnodataisstoredontheactuallocaldevices.

Clientsoftwareinstallationandupdatesaremanagedcentrallyavoidingupdatedelays.

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7.2.16. VirtualMachines

Operatorscanrunvirtualizedservermachinesforcustomers,basedonamonthlyrate.

Companies tend to distribute their server applications to smaller virtualized machines that are wellsandboxedfromeachother.Thereareanumberofsecurityreasonsforthis,butalsothereisgreatdemandtokeepindependentsoftwareseparatedfromeachotherinsteadof installingallsoftwareononecentralserver,ashasbeenthecaseinthepast.Asaresult, ifforsomereasononesoftwarefailstowork,orhasincreasedsecuritythreats,onlythevirtualserverthathousestheparticularsoftwareisimpacted.

Virtualmachinesareindependentfromthephysicalserverbelowandcaneasilybemovedfromoneserverhardwaretoanotherorfromonesitetoanotherusingfibrelinksconnectingthesites.

Virtualmachinescanbeefficientlycombinedwithstorageandbackupservices

Figure9:SchematicdiagramofVirtualServerDomains.Source:Infotech

FormanycustomersitismandatorytoruntheirapplicationsandstoretheirdataonsystemslocatedwithintheEuropeanUnion,andchoosetoworkwithanoperatortheyhaveanexcellenttrustrelationshipwith.Local/Regionaloperatorsthatcanalsoprovidenecessaryfibrelinksareaperfectchoice.

Operatorsalsohaveoptionstolicensesoftwareforvirtualserversonamonthlyfeebasis.

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7.2.17. ReplicationServicesforVirtualizedMachines

Finally,ifacompanyteamsitsownvirtualmachineswithoperatorhostedvirtualmachines,connectingthemtogetherwith fibre links and building an automated failovermanagement on top of it, this is a perfectredundancyforhighsystemuptime.Insuchsetups,notonlyisthedatamirroredtotwolocations,butalsothevirtualmachines.Scenarioscanbecompletedwithoperatorprovidedstorageandbackup.

Figure10:Acompany´sVirtualMachines,livereplicatedtoanOperatorVirtualMachineService.Source:Infotech

7.3. Section“Consumers/ResidentialUsers”

7.3.1. Introduction

Servingresidentialuserswithfibreaccesscanbeadifficultbusinesscase,giventhehighcoststobuildafibrenetworkandthelowARPUthatcanbeexpectedfromresidentialusers.AnyadditionalservicesthathelptoraisetheARPUarealwayshighlywelcome.

Inaddition,establishednetworksserviceportfolioscanbeextendedtoimprovetheexistingbusinesscase.

Thischapter listsafewofthoseservicesaimedatresidentialusersandprovidesadditionalbusinesscasecomments.

Thischapterwillalsocoveroptionstodifferentiate fromcompetition in therace for theresidentialuser.DifferentiationisimportantasnotonlyARPUmatters,butalsotake-uprate.

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7.3.2. ProductDifferentiation

7.3.2.1. DifferentiatefromCopper(ADSL,VDSL,VDSLvectoringandG.fast)

TodifferentiatefibreInternetfromcopperseemstobeeasy.Endlessbandwidthisnowavailableonfibre,bothupstreamanddownstream; incomparisoncoppernetworksonlyoffervery limitedbandwidths.ThelateststandardsforVDSLvectoringand/orG.fastforexample,candeliververyhighbandwidthsof100Mbitandevenmoretotheresidentialuser,however,thedistancefromDSLAMisverylimited,several100metersonlyforthehigherbandwidths.Themaximumavailablebandwidththendropsrapidlyto30Mbitatapx1kmandlowerthegreaterthedistance.UpstreambandwidthislimitedtoafewMbitonly,whichissubstantiallybelowfibre.Comparedtothat,fibrehasnorelevantbandwidthdegradingatall,100Mbitor1Gbitupstreamanddownstreamcanbeeasilydeliveredondistancesexceeding10kmwithtoday’stechnology.Andif10Gbitisrequiredinthefuture,itwillbejustamatterofreplacingtheactivecomponents.Choosingbetweenfibreandcopperissimpleiftheresidentialuserasksforabandwidthof100Mbitorabove.However,thechoicemaystillprovetricky,iftheuserprefershisVDSLlink,feelscomfortablewith30Mbitdownstreamand3Mbitupstreamandisunwillingtopaymorethanhispresentlevel.Fibrecanwinwithperformance,butwon’twinapricefightwithVDSL.However,assoonas30Mbitisnotenough,thecustomerwillbemoreinterestedtochangeproducts.

7.3.2.2. DifferentiatefromMobileInternet(3G/4G)

TodifferentiatefromMobileInternet(3G/4G),itwillbenecessarytomakesuretheuserunderstandstheterm“SharedMedia”.Wirelessconnectionsarealwaysasharedmedia.Ifonlyafewcustomersmakeuseoftheinternetaccess,itisamazinglyfast,howeverifcustomernumbersstartincreasing,withmoreandmoreusing mobile internet and connection from the same base station, internet performance can dropdramatically.Unfortunately,itisnotpossibletopredictthelevelofinternetuseofneighboursatanygiventime.Those residentialusers thathaveexperiencedadegradation in sharedmediaaremore likely tobepositive to fibre internet. Thisdifferentiation isof courseonly valid formobile internet that isusedasawirelinereplacement.There isaclearadvantageformobile internetservices if it istobeusedonmobiledevices,suchassmartphonesortabletsoutsidethehome.

Inthehome,stateoftheartWLANwithapowerfulfibreinternetremainsthebetterchoice.

7.3.2.3. DifferentiatefromDSLIPTV

DeliveringIPTVviaDSLrequirestheTVsignalstobetranscodedtoalowerandconstantbitrate.AsphysicalDSLbandwidthdegradeswithrisingdistancefromtheDSLAMlocation,efficientvideotranscodingisveryimportantinordertoreachthemaximumnumberofhomesaroundagivenDSLAM.IftheTVsignalstargetbandwidthcanbereducedby50%,itwillbepossibletoincreasethepotentialhouseholdsbyafactorof4.However,reducingthebandwidthalsoreducesthequalityoftheTVsignals.

ThususualIPTVsolutionsonDSLnetworksofferdeficientTVpicturequality.

Thereisnoreasonforfibrenetworkstodownsqueezethequality.FibrecandeliverthebestTVsignaleverseen.

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AnadditionaldrawbackforDSLbasedIPTVisthatmultipleTVsetsrequiremultipleconcurrentlydeliveredTVsignals.Afurtherlimitationthatresultsinlowbandwidth.IfanIPTVset-topboxisusedtoviewalocalrecording,anotherTVsignalhastobedeliveredinparallel–ifthatisstillpossible.Ifnotthenitmaynotbepossibletorecordtheprogrammeonalocalharddisk.

7.3.2.4. FromTerrestrialTVreception(DVB-TandDVB-T2)

TerrestrialTVdistributionalwaysoffersfewerTVfrequenciesandevenwhenusingthebettervideocodecs,likeHEVC,thereisamaximumlimitofaround20-30SDchannels,orevenlessforHDchannels.Tosqueezemore channels into a givenDVB-T transmission system, encodingneeds tobe reduced thus affecting TVpicturequality.

ComparedtoterrestrialTV,FibreTVcandeliveralimitlessnumberofchannelswiththebestHDTVpicturequalityavailablefromthebroadcasters.

Other than DVB-T, which is broadcast, fibre TV can build on a bi-directional connection allowing for ondemandservices,whereasDVB-TsbroadcastisgoodforliveTVtransmissiononly.

Inthepast,analogueandDVB-Treceptionwasfreeofcharge,butthisischangingovertime–asevenDVBTinfrastructurehastoshowareturnoninvestment.Therefore,DVB-T/DVB-T2isoftennolongerfreeandaswitchovertofibrebasedTVbytheresidentialuser,isnownolongereconomicallynegative.

7.3.2.5. DifferentiatefromTVsatellitereception(DVB-S)

WhensatelliteTVreceptionisfreeofcharge,asisthecaseinGermanspeakingcountries,itisdifficulttosellfibrebasedTV.

Butevenherefibrehasthepowertowintherace.

While satellite is a broadcast-only transmission and therefore limited to live TV signals, fibre based TVservicescanmakeuseofthebi-directionalconnection,andalsotheunicastbandwidthstoeachindividualusers’TVdevice.FibrebasedIPTVservicescanprovidenotonlyliveTV,butalsodeliverawidevarietyofnetwork recorded content (pause/resume, single recording, replay recording) at any given time. Anadditionaladvantageoffibrenetworks isthatsuchIPTVsolutionscanalsoaskforadditional information,suchasstillimagesoradditionalextratext/datawhendescribingaTVshowonEPG.AndfibrewillalsodeliverVODtoIPTVset-topboxes,atanytimeandalwaysinthebestqualityavailable.

7.3.3. InternetServices

Formost residentialusers,highspeed internetaccess is themain reason to connect to fibre. Fibreeasilyprovides100Mbit/secoreven1Gbit/secdownstreambandwidth,andthesameupstream.

Asymmetric internetbandwidth (highdownstream, “low”upstream) is still quite common for residentialusers, although fibre itself has no specific limitations in upstream direction. Reasons why asymmetricbandwidthsareofferedcanbefoundinthetechnologyandinproductdifferentiation.

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• GPONtechnologyprovidesveryhighdownstreambandwidthbutlimitedupstreambandwidth.GPONissomewhatcheapertoimplementthanpoint-to-point,asitonlyrequiresonecentralupstreamportforupto64homes.Itrequiresnoactivecomponentsinthestreetcabinets,butonlypassiveopticalsplitters.

• Productdifferentiationagainsthigherpricedsymmetricproductsforresidentialusers.• Productdifferentiationagainsthigherpricedbusinessinternetaccessproducts.

Awell-plannedfibrepassivelayermakesitpossibletostartwithGPONandupgradetomorepowerfulpoint-to-pointatalaterstage.

Giventoday’susagepatterns,thereishugeamountofdownstreamtraffic(mainlyvideo)andacomparablelowlevelofupstreamtraffic.FormostresidentialusersanasymmetricGPONconnectionwouldbesufficient.Ifrequirementschange,onlytheactivecomponentsneedtobereplaced.

7.3.3.1. WANAccessPoint

Forresidentialusers,anintegratedWLANaccesspointismandatory.

AsWLANcanbequitecomplex,aready-to-goplanBwithdedicatedWLANaccesspoints,WLANrepeatersorothertechnologytoenlargetheWLANcoverageforbiggerhomesisrecommended.

7.3.3.2. WLANClouds

Agoodoption istocombineallWLANaccesspointsofall theresidentialusers,addseveralpublicaccesspointsandallowuserstousethiscompleteWLANCloudwithonelogincredential.Thisrequiresthatthein-homeaccesspointsprovideasecondpublicSSID.TheresidentialusermightreceiveaprimarySSIDwithfullfibrebandwidthaccessforhimself,whilethesecond–thepublic–SSIDprovidesagoodbutlowerbandwidth.Guests,thatarealsocustomersofthisoperator,canusethepublicSSIDwithoutspecificloginprocedure.ThesameSSIDandthesameusername/passwordareusedintheentireregion.Viceversa,theresidentialusercanenjoythesameeasyaccesswhenhevisitsfriendsorifheisinclosevicinityofoneofthepublicaccesspoints.Generaltermsandconditionswithresidentialusersneedtocoverthisdoubleusage.

7.3.4. VoiceServices

Fixedlinevoiceservicessometimeseemtobeout-datedintimesofextensivemobilecoverage,butthereremainsdemandforthisserviceanditiseasytoimplement.VoiceservicescanbeprovidedasPOTS(planold–analogue–telephonyservice)oralsoasSIPconnections.WirelessSIPphonesarewidelyavailable.

Themostbasicbusinessmodelavailableinvolvestheoperatorprovidingthevoiceserviceatamonthlyrate,withvoicetimebeingchargedbytheminute.Advancedmodelsmayincludeflattariffs,freeonnetcalls,freenationalcallsandothervariations.

Themonthlybasefeecanbepartofabundleoffering.AndoncethePOTS/SIPconnectionisactive,asitispartofabundle,itwillalsobeusedandprovideadditionalperminuteraterevenues.

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7.3.5. MobileVoiceandData

MobileVoiceandDatapersearenotafibreservice,howeverinsomemarketsitmakessensetoexpandtheusual triple play (internet, TV, voice)with a personalisedmobile offering, to form extended bundles forresidentialcustomers.Mobileservicescanbesourcedfromthelargemobileoperatorsandpassedonasatradingproduct,oralternatively,thoseservicescanbeacquiredusingMVNOofferings.

7.3.6. TVServicesviaHFOverlay

AclassicDVB-ClikeTVservicecanbeprovidedonfibreusingHFoverlaytechnologies.Howdoesthiswork?AdigitalDVB-CorevenanalogueTVsignal isdeliveredusinga separate fibreora separatedownstreamwavelength.TheCPEconvertsthesignalintoatraditionalcableoutputtobedistributedwithinthehome.HFoverlayisone-wayandbroadcastonly.ClassicDVB-CencryptionservicesandsmartcardscanbeusedtodeliveroptionalpayTVbouquetsortopassthroughalreadypre-encryptedDVB-Ccontentsimilarto“Sky”inGermany.HFoverlaydoesnotprovideupstreamconnectivityasavailableontraditionalcablenetworksusingtheDOCSIS standard.However, the upstream IP connectivity is available via the primarywavelengths IPconnection.

HFOverlaydoesnotprovideoptions foradvancedTVservices,but itdoesprovideahighly standardizedclassicTVbroadcastservicesimilartocablenetworks.AnyTVsetthatcanacceptDVB-CsignalscanreceivetheTVchannelswithouttheneedforaset-topboxinbetween.MostofthecurrentlyavailableTVsetshaveabuilt-inDVB-Creceiver.Somealsoprovidelocalrecordingoptions.

WhileHFoverlayiseasytoimplement,itrequiresmoreexpensivespecificnetworkingequipmentbothathomeandcentrallytoprovidethisextraHFtransportcapability.

7.3.7. IPTVServices

AdvancedIPTVservicesmakeuseoftheIPconnectivitythatispartofthebasicFTTHserviceanddoesnotrequirespecificHFcapablenetworkingequipment.

IPTVservicesareabletodelivertraditionalliveTVsignalsaswellasanykindofon-demandvideoservices,suchasvideo-on-demand,networkrecordings,networkreplay/catch-upservicesandmuchmore.AmajoradvantageofadvancedIPTVservicesisthatallofthoseservicesarepackagedtogetherintooneproductthusprovidingallservicesviaoneuserinterface.Thoseservicesalsoallowsearchingcontentcrossmediaaswellas presenting crossmedia recommendations. IPTV is always two-way, and therefore provides access tooptionalservicesincludingpaymentrequestsandconfirmations.IPTVcanprovideapowerfulauto-upsellingplatform.InadditionIPTVdeliveriescanbecustomizedperuser,perregion,percity.

AlthoughIPTVoffersunprecedentedaccesstoalargenumberofmediaassets,itstillremainsprimaryTVandtraditionally,thatisaleanbackmedia.ThemajorcontrollingdevicesforanIPTVset-topboxisthegoodoldremotecontrol,whichhasbeenawell-knowndeviceforallTVusersfordecades.EventhoughtherearesomeadoptedkeysforIPTV,thebasicfeaturessuchaszapping(p+/p-)andvolumecontrol(v+/v-/mute)remainfirmlyinplace.Easy-to-implementinfraredtransmissiontechnologiesarestillforemostinuse,butthereisanongoingshifttousestandardizedradiofrequencytechnologieslikeBluetoothLowEnergy.Radiodoesnotrequire a line of sight (whichmeans that the set-top boxes can also be stored behind the TV or hiddensomewhereelse),anditoffersnewoptions,suchasvoicecontrol,whichisalsoanupcomingtrend.Justsay“Tagesschau”andtheTVsystemwillselectthelatestnewsprogrammeofthatname.

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7.3.7.1. Features

AdvancedIPTVServicesprovideanumberoffeatures.Belowarejustafewofthemwithexplanations.

• ExtensiveEPGmetadataincludingstillimagesandtrailervideos.o EPGmetadataincludestitle,shortandlongtextdescription,thepeopleinvolved,technical

informationabouttheshow(includinglengthofcontent,availableaudiotracksetc.),seriesinformation(seasonandepisode)andmuchmore.MostofthisinformationisnotavailableontraditionalDVB-SorDVB-CTVservices.

o UsingstillimagesandclearcrispfontswithintheuserinterfaceinsteadofplainteletexttypeUI–asseenonmanyTVsandsatellitereceivers.

o EPGdataispresentedwhilezappingthroughthechannelsaswellas inmatrixEPGviews.DetailedEPGdatacanbeshownondemand.

• FastZappingo TraditionalDVB-C/DVB-Sstandardsprovidezappingtimesof1-2secondsminimum.Itisvery

difficult to improve (=reduce) such times. Zapping times on broadcast media will evenincreaseasencodingimproves,duetolongerGOPstructures.

o IPTVsolutionscanprovidezappingtimesof0.1-0.2seconds,asitcanaccessserverbasedhelperservicesinthebackoffice.Withthoseexcellenttimes,even“normal”liveTVzappingisfun.

• AccessPayTVPackageso ProvidesaccesstobrowsethroughavailablepayTVpackageso Packagesubscriptioneffectiveimmediately

• Pause/Resumeo Verysimplefeature,easytouse,easytounderstand,stillveryhelpful

• RecordingofTVshowso Recordingisawell-understoodfeature,nowintegratedintotheTVexperienceo Recordingcanbeperformedlocallyorcentrally(ànetworkrecording)o Networkrecordingalsoworks,iftheset-topboxisofflineduringrecording

• ReplayFeatures(30h/7d)o Somecountries/channelsallowforthecontenttobepre-recordedcentrallyandreplayed

withinacertainamountofhours/days,commonlyusedare30hoursand7days.o Apowerfulfeatureasusersdonotneedtopre-recordshowstheywanttowatchlatero Seechapter9(Switzerlandreplay)formoredetails

• “Recordfromyesterday”(RecordfromReplay)o Ifthereplayfeatureisavailable,thenspecificTVshowscanalsoberecordedfromthepast.

Ifaviewermissedaprogrammefromthepreviouseveninghecanrecorditadaylater.Apowerfulconcept,combinedwithReplay.

• Seriesrecordingo Series recording allows the viewer to record all the episodes from the entire series.

TechnicallytheEPGmetadatafields“SeriesID”,“Season”and“Episodes”areusedtoidentifytherightcontenttorecord.

• Subscribetoadditionalnetworkrecordingspaceo Iftheviewerwantstorecordaprogrammebuttherecordingspaceisfull,hecansubscribe

onscreentoanupgradeoftherecordingspace.Availableimmediately.

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• Video-on-Demando TopratedfilmscanbeaccessedfromtheviewersownIPTVuserinterfaceo Receivefilmsrecommendationsonthehomescreeno Renttopfilmstobeviewedwithin48ho Purchasefilmstobeviewedatalatertime(EST=electronicsellthrough)o Browsethroughvideos,watchtrailers

• Searcho Searchallmediaavailableo Textsearcho Voicesearch

• Recommendationo Receiverecommendationsbasedonsettingsorbasedonusagepatternso RecommendationscanbeliveTVshows,TVshowsavailableonreplay,aswellasavailable

VODtitles• MobileIntegration

o ConnectmobilephonestotheIPTVsubscriptiono Usethesmartphoneasaremotecontrolo BrowsethroughTVshows,accessEPGMatrixonthemobileo BrowsethroughavailableVODtitleso ProgrammePVRrecordingsfromdistanceo AccessliveTV,recordings,replaysorvideosdirectlyfromyourmobiledeviceo Redirectashowbeingviewedonyourmobiletothescreenathome,orviceversa

• PhotoViewo Accessphotosandvideosfromcloudstorageo Viewaslideshowonyourhomescreen

• Accesstoregionalnewsandinfo,ontheIPTVhomescreeno Examples

§ RegionalRSSnews§ Regionalweeklyvideomessages§ Regionalmountain/river/seaside/weathercams

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7.3.7.2. UserInterface–Impressions

Figure11:IPTVMainMenuUserInterfaceCopyrightOcilionImages©ORFDieInselderbesonderenKinder©2016TwentiethCenturyFoxFilmCorporation.Allrightsreserved

Figure12:IPTVElectronicProgrammeGuide/MatrixViewUserInterfaceCopyrightOcilionImage„Vorstadtweiber“©ORF

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Figure13:IPTVElectronicProgrammeGuideDetailViewUserInterfaceCopyrightOcilionImage„Vorstadtweiber“©ORF

Figure14:IPTVContentSearchUserInterfaceCopyrightOcilion

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Figure15:IPTVVideoOnDemandCoverFlowUserInterfaceCopyrightOcilionSpectre©2015Danjaq,LLC,Metro-Goldwyn-MayerStudiosInc.,ColumbiaPicturesIndustries,Inc.SPECTRE,007GunLogo,andrelatedJamesBondTrademarks©1962-2016Danjaq,LLCandUnitedArtistsCorporation.SPECTRE,007GunLogoandrelatedJamesBondtrademarksaretrademarksofDanjaq,LLC.Allrightsreserved.DieInselderbesonderenKinder©2016TwentiethCenturyFoxFilmCorporation.Allrightsreserved.IndependenceDay:Wiederkehr©2016TwentiethCenturyFoxFilmCorporation.Allrightsreserved.TheSeaofTrees©Elite-FilmAGEinganzeshalbesJahr©2016WarnerBros.EntertainmentInc.andMetro-Goldwyn-MayerPicturesInc.Allrightsreserved.StarTrekBeyond©2017ParamountPictures.STARTREKandrelatedmarksaretrademarksofCBSStudiosInc.

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Figure16:IPTVVideo-On-DemandDetailViewUserInterfaceCopyrightOcilionDieInselderbesonderenKinder©2016TwentiethCenturyFoxFilmCorporation.Allrightsreserved.

Figure17:IPTVMobileConnectScreen.StarttheMobileApp,ScantheQRCodeandyouareconnectedandpairedUserInterfaceCopyrightOcilion

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Figure18:IPTVLiveTVZapperViewUserInterfaceCopyrightOcilionSceneLandkrimi©CopyrightORF

7.3.7.3. Set-topboxes

Someof the current TV sets alreadyprovide IP connectivity aswell as smart TV features (with CPUandgraphicspoweron-board),howeverastandardisedimplementationofanIPTVsoftware-onlyclientisstillnotavailable.

AtpresentallIPTVservicesdelivercontentusinganoperatorprovidedset-topbox.Set-topboxesinterfacewithTVsetsviaHDMIports,whichiswellstandardized.ThereisHDMI1.3/1.4forHD,andHDMI2.XforUHDdevicesrespectively,bothofwhichareupwardsanddownwardscompatible.

ThecostofanIPset-topboxtodayisverylow,beingmoreorlesscomparabletotheadditionalcostofHFoverlayequipmentasdescribedabove.However,thecostofIPset-topboxesisonlyrelevanttothosewhosubscribetoanIPTVservice,whileHFoverlayequipmentisusuallyrolledouttoallcustomersregardlessofTVsubscriptionstatus.

Operatorsingeneralavoidrollingoutextradevicesintoresidentialhomeswherepossible.Howeverset-topboxeshaveestablishedthemselvesasaverywelcomeinterfacingdevice:

• Theoperatorisveryfamiliarwithhisownset-topbox.Ifthehelpdeskagentreceivesasupportcall,he has access to well-predefined support procedures and is probably able to help the caller. Inadditiontheoperatoroffersanumberofremotediagnosticfeaturestoaidtheagentinsolvinganyissuesthatmightarise.Asaresulttheconsumerwillreceiveefficientandspeedyassistanceaswellasapositivecustomerexperience.

• SmartTVsarecapableofoperatingasoftwareonlyappclientforanIPTVservice,butthatscenarioiscoupledwithdrawbacks:

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o SmartTVAppplatformsarenotstandardized.SeveraldifferentsmartTVappplatformshavetobesupported

o SmartTVAppbehaviourisheavilydependentontypeofsmartTVplatformandversionofsmartTVsoftware.Atpresenttherearealargenumberofversionsandplatformsavailablewhichareverydifficulttodetectandmaintain.

o ConsumerTVsetshaveaveryshortlifecycle,withnewconsumerproductsoftenappearinginlessthansixmonthsafterthepreviousversionhasbeenrolledout.Asaresult,thereis,inaddition to a greatnumberofplatformversions, also an increasingnumberof hardwareplatforms.Theseplatformsdiffersubstantially,bothinsoftwareandhardwarecapabilities.

o Whenaconsumercallsthehelpdeskagentforsupport,itisoftenverydifficultfortheagenttoidentifytheexacttypeofSmartTVinquestion,andevenmoredifficulttoprovidepropersupport.Asaresult,theconsumerveryoftencannotreceivethesupporttheyseek,whichresultsinanegativecustomerexperience.

o Afurtherargument forusingaset-topbox is the“full screenappearance”.Set-topboxesdominatetheuserexperienceintotal.IncomparisonthesmartTVuserexperienceisinitiallythatofthesmartTVvendor.Theoperatoronlyappearsasanapp,oneamongstmanyothers.ThereforethesmartTVlacksthenecessaryintegrationandAPIinterfacesthatwouldhavebeenexpectedbyoperators.Thisisnotlikelytochangeshortterm.

Figure19:IPTVSet-topboxwithRemoteControlCopyrightOcilion

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7.3.7.4. IPTVaspropositionagainstOTTSVODServices

IPTVhasgreatpotentialtoco-existbesideOTTSVODservices,asitallowsoperatorstoearnextramonthlyrevenue with services that can be generated on net. Onemajor advantage for the operators IPTV is itcombinesguaranteedqualityofservicewithnationalTVcontent.ItshouldbenotedthatthisrelatestobothIPTVandOTTSVOD.

Figure20:IPTVEconomicalandDataTrafficFlowsSource:Ocilion

7.3.8. InternetSecurityServicesforResidentialUsers

Internetsecurityservicesforresidentialusersneedstobehighlycostefficient,howeveritispossibletoofferadditionalservicesthatcangenerateafewextraEURsrevenuepermonth,oralternatively,securityservicescanbeincludedinhigherlevelbundles.Toacertainextentsuchsecurityservicesalsoserveasself-protectionfortheoperator,as,inthecaseofsuccessfulattacks,residentialusersareverylikelytocontacttheoperators’helpdeskforsupportfirst.

Somesuggestions:

1) Mail Security, Anti-Virus, Anti-Spam,Malware Protection. Can be a limited home edition of theSecureMailofferingsforbusinesses.

2) Antiviruswithupdateservices.3) Firewalltoprotectagainstincomingthreats.SometimesabasicNetwork/PortAddressTranslation

willdothejobquitewellasitallowsanyoutgoingtraffictopassoutandanswerstopassin,butdoesnotallowanyincomingtrafficatall.

4) WLANaccesspasswords.Providestrongpasswordsasdefault.Avoid1234.

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7.3.9. CloudStorage

Theoperator canprovide cloud storage for the residential user. This offering canbepart of an internetservice,partofabundleoranextrasubscriptionservice.Residentialusersmaystoretheirphotosorvideoson thecloud,which theycanaccess fromanywhere,or simplybackuptheir local files to thecloudasanadditional storage facility.Optional revenues can come fromcloud storageupgradesas some residentialusersmightbeinterestedingainingmorespacethanisalreadyincludedandarepreparedtopayforthatservice.

Thereareanumberofcloudstorageoptionsavailablethatcanbeusedbytheoperatoraswellasaselectionof ready to go solutions on which to build and run an own-cloud-space at the operators’ premises.Incorporatingacloudstorageserviceforconsumersalsodeepensthetrustrelationshipwiththeoperatoraswellaskeepingtraffic insidethenetwork.This isespeciallyrelevantforstoring/recalling largevideofiles.Havingthefilesinsidetheoperator’snetworkdoesallowtheresidentialusertoaccessthefilesinperfectspeed.Moreinformationisavailableinthechapter,BusinessStorageServices.

7.3.10. Gaming

Online Gaming is a fast growing future market that requires high bandwidth and low latency, which isavailablethroughfibre.Sowithouttheneedtoinvestmuchenergyintoattractinggamers,theywillchoosefibrewheneverpossible.

Itmaymakesensetorunthegamingserverswithintheoperator’sownnetworktofurtherreducelatencytime.Somegamingplatformssupportsuchlocalapproachestoimprovecustomerexperience.

Itisverylikelythatthereisnodirectrevenuefromgamingfortheoperator,buttherearequitegoodindirectrevenuesasgamespreferfibre.

7.3.11. SmartHomeServices

Residentialusersaskforready-to-gohomesecurityandhomeautomationsolutions.

Withanexistingfibrelink,theoperatorcanprovidethesesmarthomesolutionsasaservicethatismoreprofitablethansimplyimplementingdevicesonsite.

7.3.11.1. HomeSecurity

Forexample,avideosurveillancesolutioncancompriseofhomemountednetworkcameraswithacentrallyoperated 24h video storage. Residential users can access the video storage from their own devices,smartphones,PCs,aswellastheoperatorsIPTV,bothfrominthehomeandfromotherlocations.

Camerascanbefixedormoveable.

Thereareanumberofotherhomesecuritysensorsinadditiontothecameras:

• Motionsensors• Contactsensors(door,window)• Glassbreaksensors• Surfacecontactsensors• Smokesensors• Temperatureandwatersensors

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Residentialusersmaygrantaccesstosuchdevices–viatheoperator-tolocalsecurityfirmsthatmaytakefurtheractionintheeventofanalarmorintheeventofemergency.

Residentialuserspreferaserviceproviderwhomaintainsthesystemandisavailableon-callwhenneeded.Homesecurityservicescanbesuccessful,especiallyifthereisanexistingtrustrelationshipbetweentheresidentialuserandtheoperator.

7.3.11.2. HomeAutomation

Residentialusersarealsointerestedinaccessingtheirhomedevices.Theywantdevicestatusupdates,tobeable to control the heating, the lighting, check for solar power generation or the in-home solar batterysystem.Thereisalargearrayofsolutionsonthemarkettoday.

Givenanexisting fibre link, thereareoptions for theoperator toofferhomeautomation service for theresidentialusers.

Residentialuserslikehavingsomeonethatistakingcareandsomeonethattheycancallincaseoferrororiftheyhaveaquery.Againhomeautomationservicescanbesuccessfulduetoexistingtrustrelationship.

Homeautomationandhomesecuritycaneasilybecombinedtoonefamilyofserviceofferings.

Homeautomationservicescanbecombinedwithotherservices,likeIPTV.

7.3.11.3. SmartEnergy

Usedatafromthehome(temperature,humidity,activity,etc.)todecideacourseofaction.Forexample,usethedatatocontrolthethermostat.Orswitchoffthelightsifnooneisathome.Thiscanbedoneforindividualroomsorfortheentirehome.

7.3.11.4. ElderlyCare

Elderlycareisallaboutleveragingonthethreeothersmarthomeservices–security,automation,energy-toprovideasafe,secureandcomfortableenvironmentforelderlypeople,sothattheycanstayintheirownhomeslonger.

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7.3.11.5. SmartHomeExamplesinEurope

Figure21:ExampleTelefonica‘MovistarVerisureHogar’HomeSecurityCopyrightTelefonicaSource:Nokiahttps://www.telefonica.com/es/web/press-office/-/telefonica-starts-the-quintuple-play-era-in-spain-with-the-launch-of-movistar-verisure-hogar-

Figure22:ExampleAT&TSecurityOfferingsCopyrightAT&TSource:Nokia

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Figure23:Telefonicalaunched‘MovistarVerisureHogar’inMay-15,aspartofaquintplayofferPartners:Verisure(homealarmprovider)Includesa24/7immediateemergencyresponseserviceCopyrightTelefonicaSource:Nokia

7.3.12. SmartMetering

Operators can provide data access to smart meters and charge a monthly/annual fee. In this case thecustomerismostlikelynottheresidentialuser,buttheoperatoroftheregionalelectricitynetwork,ortheoperatoroftheregionalnaturalgasnetwork.

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8. TheFifthGenerationMobileNetwork(5G)

8.1. IntroductionThe fifthgenerationofmobile technology5Gaddresses thedemandsandbusinesscontextsof2020andbeyond.There ismuch interestandhypeabout5Geventhoughtherearenostandardsavailableandnofrequencybandsassignedasyet.5Gisbothevolutionofexistingmobiletechnologiesandrevolutionintermsofnewfeaturesnotseenbefore.Itisanecessityforreal-timeapplicationssuchasautonomousvehiclesandInternetofThings(IoT)systemsandisbasedonnewarchitectures,technologiesandfeatures.

Today’smobilenetworksaredesignedprimarilytoprovidemobilebroadband.Theywerenotengineeredtosupport the expected growth in demand for digital content and connectivity to machines. Marketresearchers, vendors, and operators foresee tremendous requirements for massive capacity andconnectivity.5Gisallaboutanytime,anywheresupportfor:

• Massivetrafficgrowthandhighdensityondemand• Awidevarietyandvariabilityofservicesconsumed• Criticalmachine-typecommunication(MTCandM2M)thatrequiresimmediate,synchronized

eye-to-handfeedbackforvirtualrealityapplicationsthatwillallowuserstoremotelycontrolrobots,creatingthetactileInternet

• Massive MTC that connects billions of sensors and machines, from watches to refrigerators, toparkingmetersandcars.

• Stringentdemandsforrealtimecommunications.

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Figure24:Comparisonoffeaturesbetween4Gand5GSource:Europeancommission

8.2. Whatis5G?

TheNGMNAlliance–currentlycomprises86Partnersfromthetelecommunicationsindustryandresearchcommunity: 25mobile network operators (Members), 37 vendors/manufacturers (Contributors), and 24universitiesornon-industrialresearchinstitutes(Advisors)–publishedinFebruary2015a5GWhitePaper.ThisAlliancehasaclearvisionconcerningnextgenerationofmobilecommunications:“5Gisanend-to-endecosystemtoenableafullymobileandconnectedsociety.Itempowersvaluecreationtowardscustomersandpartners,throughexistingandemergingusecases,deliveredwithconsistentexperience,andenabledbysustainablebusinessmodels.”

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Therewillbealargenumberofnewusecasesrangingfromdelay-sensitivetoultra-lowlatencyapplications,andfrombesteffortapplicationstoreliableandultra-reliable,suchashealthandsafety.NGMNisfocusingoneightcasefamilieswithsomegivenexamples:

• Broadbandaccessindenseareas–pervasivevideo• Broadbandaccesseverywhere–50+Mbpsinallareas• Higherusermobility–highspeedtraincommunications• MassiveInternetofThings–sensornetworks• Extremereal-timecommunications–tactileInternet• Lifelinecommunications–naturaldisaster• Ultra-reliablecommunications–e-healthservices• Broadcast-likeservices–localbroadcastservices,newsandinformation.

5G also will expand to new business models to support different types of customers and partnerships.Operatorswillbeabletosupportvertical industriesbyconfiguringnetworkslicestoactualrequirements.Furthermore 5G will use new network technologies and infrastructures to provide the actual capacitiesneededtohumansandmachines.

The concept for 5G is both an evolution of wireless networks tomeet future demands for data, and arevolutioninarchitecturetoenableaflexibleandcostefficientnetworkthatcanbeefficientlyscaled.Thefollowing features of 5G are currently under discussion in various forums such as NGMN, ITU, 5GPPP,EuropeanCommission,IETF,andIEEE:

• 1,000Xinmobiledatavolumepergeographicalareareachingatarget≥10Tbps/km2• 1,000Xinnumberofconnecteddevicesreachingadensity≥1Mioterminals/km2• 100Xinuserdataratereachingapeakterminaldatarate≥10Gbps• 1/10Xinenergyconsumptioncomparedto2010• 1/5Xinend-to-endlatencyreaching5msfore.g.tactileInternetandradiolinklatencyreachinga

target≤1msfore.g.VehicletoVehiclecommunication• 1/5XinnetworkmanagementOPEX• 1/1,000Xinservicedeploymenttimereachingacompletedeploymentin≤90minutes(compared

tocurrently90hours)

Inaddition,5Gserviceswillcomplementandlargelyoutperformthecurrentoperationalcapabilitiesforwide-areasystems,reachingthefollowinghigh-performanceindicators:

• Guaranteeduserdatarateeverywhere≥50Mbps• Aggregateservicereliability≥99,999%• Capableofhuman-orientedterminals≥20billion• CapableofIoTterminals≥7trillion• Servingover7billionpeople• Mobilitysupportatspeeds≥500km/hforgroundtransportation• Airplanesconnectivity–80perplane,60airplanesper18.000km2• Accuracyofoutdoorterminallocation≤1meter• Ensuringforeveryoneandeverywheretheaccesstoawiderpanelofservicesandapplicationsat

lowercost

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5G is not just another generation of mobile networks. It is a new network concept that enables theintegrationofaubiquitousaccesscontinuumcomposedofcooperative,cognitivefixedandheterogeneouswirelessresources,withfixedopticalaccessreachingatleastthe10Gbpsrange,whileimplementingnewfunctionalitiesthatallowsimplifiedandunifiedcontrol.Thereisasharedawarenessthatthedevelopmentofnewcommunicationnetworksisdependentontheemergenceofgloballyacceptedstandardsinordertoensureinteroperability,economiesofscalewithaffordablecostforsystemdeploymentandendusers.

Thelaunchof5Gwillhappenonanoperatorandcountryspecificbasis.Someoperatorsmightplantolaunchin2020–otherswillplanforalaterdeployment.Thefirstpublictrialofa5GsystemisexpectedtobeinoperationfortheOlympicWinterGames inPyeongchang,SouthKorea inFebruary2018.SKTelecomhasalready deployed the world’s largest 5G trial network and demonstrated the world’s first 5G-basedconnectedcarinNovember2016.

8.3. Newtechnologiesandopportunities5Gwillbuildonearliergenerationmobiletechnologiesandbringadditionalcapabilities.Thecompletenewfeature“NetworkSlicing”definesacollectionof5Gnetworkfunctionsandspecificradioaccesstechnologies(RAT)settingsthatarecombinedtogetherforaspecificuseforacaseorbusinessmodel.Thus,a5Gslicecanspanalldomainsofthenetwork:softwaremodulesrunningoncloudnodes,specificconfigurationsofthetransportnetworksupportingflexiblelocationoffunctions,adedicatedradioconfigurationorevenaspecificRAT,aswellasconfigurationofthe5Gdevice.

Tomeettherequirementsofextremelowlatenciesbetweenterminalsandbasestationsaswellasend-to-endthroughoutthewholenetworknewswitchingmethodsarerequired.Circuitandpacketswitchingwillbereplacedbyanewtechnologycallednetworkcoding.Processingofdatawillbetransferredtothenetworkedgeandinsteadofcloudcomputingwewillseemoreandmorefogcomputing.

Finallytoprovidethenecessarycapacitiesthe5Garchitecturecomprisessocalledsmallcells.Incomparisonwith4Gthereareatleast10timesmoreantennasrequired.Eachoftheseneedtobeconnectedwithafibreinfrastructure, the only solution to deliver high capacity and provide high availability and low latency.Operatorsaroundtheworldarealreadydeployingnewantennalocationstobereadyforthenextgenerationof public mobile networks. Here is the chance for planners, vendors, and operators to build the highperformingnetworkofthefuture.

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9. TheRoleofIPTVandTVReplayinSwitzerland

Switzerland is anexcellent exampleof howefficient copyright rules can generate a tremendouspositiveimpactonfibrerollouts.Itisalsoasuccessstoryaboutfibre.

9.1. Howeverythingstarted…Starting1January2009SwitzerlanddecidedthatlocalTVrecordingandnetworkbasedTVrecordingshouldbetreatedequallyfromacopyrightfeesperspective.AtthattimecollectionsocietySuissImagepublishedanewcommontariffcalledGT12thatdefinedafeetobepaidbynetworkoperatorsofferingTVrecordingfeatures, the fee to be paid per recording subscriber permonth. This fee has to be paid by all networkoperatorequallyregardlessoftypeofnetworkandsize;thefeeisthesameforsmalllocaloperatorsaswellasforbigoperatorslikeSwissCom.

Overtheyears,GT12hasbeenrenegotiatedandupdatedfromtimetotime.TodayGT12differentiatesbetweenthreelevelsofrecordingservices:

• PVRonly• PVRand30hoursofreplay• PVRand7daysofreplay

The legal framework is based on “home copy”,whichmeans that all usersmust initiate their recordingthemselves.Iftheuserwantstogainaccesstoa7dayreplayoffering,heneedstostartthat7dayrecordinghimself,anditwilltake7daysuntiltherecordingisfullyavailable.

Technical deduplication is allowed, without any discussion, which is very efficient for the operators. IfhundredsorthousandsofusersrecordthesameTVshow,theoperatoronlyneedstophysicallyrecorditonceandusereferencestowardsthisrecording.Howevertheoperatorneedstoensurethathomecopyrulesarenotviolated:Noplaybackofcontentthathasnotbeenrecordedbeforebythatuser.

9.2. RetransmissionofTVsignals

A second very important rule that has been in place in Switzerland over a long period of time, involvesretransmissionofTVsignals.AgainSuissImageprovidesacommontariffcalledGT1thatdefinesthefeethathas tobepaidby theoperator,per subscriberpermonth.Using these rules,Swissoperatorsare free toretransmitanyTVsignalthatcanbereceivedfree-to-air,regardlessifitisaDVB-SorDVB-Treception.TheonlybindingconditionisthatthereceivingantennaandreceivingequipmentmustbeinsideSwitzerland,andthesignalmustbefree-to-air.ThesumofallGT1paymentsarethendistributedtothevariousbroadcastingstationsinsideandoutsideSwitzerland.AgaintheGT1feeisidenticalforbothsmallandlargeoperators.

9.3. EasyAdministration

Furthermore, theadministrativeefforts to start-upand runa TV service in Switzerland is very low.All itrequiresisasignatureontheSuissImageagreement,paymentofthemonthlyfeesandeverythingisready

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togo.Swissoperatorsdonotneedtonegotiatedirectlywithbroadcastingstationsorothercontentowners.IftheywanttoretransmitTVsignalstheysignupforGT1,iftheywanttoprovidearecordingserviceontop,theysignupforGT12.

GT12allowsfortherecordingofallTVshowsfromanychannelthatiscoveredbyGT1retransmissionrights.Therearenoexceptions,norecordingholesandnochannelsthatareexemptfrombeingrecorded.

9.4. HoweverythingdevelopedsincethenEightyearson,itisveryinterestingtolookbackandseehowthingshavedevelopedfortheserviceproviderandofcourse,asthisisapublicationbytheFTTHCouncilEurope,howtheyhaveimpactedonfibrerollouts.

Accesstothedataiseasy:SuissImagepublishesyearlyreportsthatspecifytheannualfiguresofthevariouscommontariffs.Bycollatingallannualreportsfrom2009anddrawingachartofGT1andGT12tariffstheresultisaveryinterestingpicture(figuresof2016notyetavailable):

Figure25:CommonTariffsGT1andGT12;AnnualfeesovertimeCompilationbyOcilionSource:suisseimage.ch;eschk.ch

SwissoperatorshavebeenverysuccessfulinimplementingservicesbasedonGT1andGT12.Ascanbeseenfortheperiodfrom2009,anadditionaltotalofmorethan1mhouseholdschosetosignupforaTVservice(seeGT1),whilstatthesametimeevenmorehouseholds(thosewhosignedupforanewTVserviceaswellas thosewhoalreadyhad subscribed toTVearlier)havealso signedup foravariationofaTV recordingservice.Giventhefigures,themajorityofthehouseholdsobviouslysignedupforatleasta30hourreplayservice,withincreasingnumbersswitchingovertothe7dayversion.

19mCHF(apx1.2mhrsReplay)(CHF0.80/1.10/1.50permonth)

26mCHF(+1.0mhouseholds) (CHF2.18permonth)

72mCHF(2.75mhouseholds)(CHF2.18permonth)

TotalSwitzerland: 3.55mhouseholds

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IthasbeenascertainedthatReplayTVisprobablybeingusedbyalmosthalfofallSwisshouseholds(endof2016).Thisisahugesuccessgiventhefact,thatithadnotbeenavailableatalljustafewyearsago.

9.5. HugeAmountofIPTraffic

Asshouldonlybeexpected,andalsoconfirmedbyMediapulse,theaverageusagerateofreplayserviceshasincreasedyearonyear.In2016partiallymoreuserswerewatchingreplayTVthanliveTV.Thisiswhereitbecomesrelevanttotalkaboutfibrerollouts.

ReplayTVismainlyusedatthefirstscreenandusersexpecttoviewTVprogrammesinthebestHDqualityavailable,8-12Mbits/secH264.ReplayTVisunicastonly,eachTVsetgetsitsownindividualstreamandeachstreamisdeliveredinreal-timefromtheoperator’svideoservers.ManyhouseholdshavemultipleTVsetsusingReplayTVatthesametime.ItisalreadyapparentthatjustafewTVsetsshowingHDreplayTVconsume30-40Mbits per second for hours. This relates solely to TV, and for the full picture add internet usage,secondaryin-homestreamsonmobiledevices.

Itisalsonecessarytoconsiderthehighconcurrencyoftheunicaststreams.TraditionalcablenetworkswithDOCSIS 3 shared bandwidth approaches have to be operated very carefully to keep trackwith the datavolumeexplosion.Cablesegmentshavetobesplitandsplitagain,andfurtheractiveDOCSIScapacitieshavetobeadded.DSLnetworks,evenVDSL2andvectoringsimplycannotprovidethebandwidthsneeded.

9.6. OnlyfibrecandeliverFibrenetworkshoweverdonothaveanyissuesatallwithsuchdemandingusagepatterns.ThisiscertainlythereasonwhyeventraditionalcableoperatorsbegantransformingtheirownnetworksfromHFChybridfibrecabletoFTTH.ThemajorIPTVproviderSwisscom,comingfromcopper,investedheavilyintorebuildingtheiraccessnetworksandgoingdirectlytoFTTH.

Today,SwitzerlandhasoneofthebestfibrecoveragesinEurope.

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9.7. ReplayTV–ValueAddedbytheSwissOperatorsReplayTVtrafficisgeneratedwithinSwitzerland.

OperatorsthemselvesreceivetheTVsignalsfromtheairandruntherecordingservers.

Operatorsgenerateimmensetrafficthemselves,efficientlypositionedinthecentreoftheirownnetworks.

OperatorsdonotneedtosignupforexpensiveinternationalinterconnectionstocaterforthishugeIPtrafficasitistheirownservice.

EventhoughtheoperatorsmustpaytheSuissImagefees,itisstillverygoodbusiness.

Finally,operatorsgenerateadditionalrevenueandarethereforewillingandabletofundfibrerollouts.

MostofthevalueaddedisgeneratedbySwissoperatorswithinSwitzerland.

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10. WeblinksandReferences

BusinessServices

www.infotech.at

ResidentialIPTVServices

www.ocilion.com

ResidentialSmartHomeServices

https://networks.nokia.com/solutions/smart-home

SwitzerlandMediaUsage

www.mediapulse.chàTVàPublikationenàSemesterzahlenàZeitversetzteNutzung

SwitzerlandCollectionSocieties

http://www.suissimage.ch/àDownloadsàTarife

http://www.suissimage.ch/àDownloadsàGeschäftsberichte