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The October 19, 2007 Issue Provided by System Dynamics Inc.
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The 2007 Fiber to the Home Conference: Heaven for Bandwidth Hogs

We got a call earlier this year asking us to participate in the 2007 Fiber-to-the-Home Conference and Expo. FTTH has started taking off in the U.S., and we gladly accepted the invitation to get involved.

The Fiber to the Home Council, which sponsors the conference, is a non-profit organized to help its members plan, implement, market, and manage their FTTH deployments. Members include vendors, municipalities, utilities, developers and more traditional service providers.

While fiber to the home has been deployed for some time in many parts of Asia and Europe, it has only recently passed the first million home mark in North America. Verizon's FIOS deployment--now in full swing--accounts for much of that.


Educational Program

The conference included a very extensive educational program of general and breakout sessions, with keynote addresses by key players in the FTTH and related industries. It was opened by Cathy Harriman, Sr VP EPB Telecom, the outgoing Chairman of the Council. Cathy said that about 100 people attended the group's first FTTH Conference held four years ago in New Orleans. Things have certainly changed: more than 2000 attended the 2007 show.

The Exaflood

The opening keynote speaker--Bret Swanson of the Discovery Institute in Seattle--talked about the coming consumer-driven bandwidth explosion he terms "The Exaflood". In 1993 the entire Internet handled 100 terabytes a year (just 50 times more than the 2 Tb storage system we just installed in our home). By the end of 2006, Internet traffic was 700 petabytes per month--a run rate of 8.4 exabytes per year. (The sequence in factors of 1000 is mega→giga→tera→peta→exa→zetta.)

This growth trend is likely to continue, with telephone traffic moving to Internet-based services such as Skype and with more and more video traffic running over the Internet and organized into portals such as YouTube. The growth of IPTV (in the sense of television delivered with IP protocols), video telephony and peer-to-peer services will further increase Internet traffic.

Bret Swanson of the Discovery Institute estimates annual IP traffic --> Click for larger pictureProjecting these and other trends forward, he estimated that annual Internet traffic will reach a zettabyte in five to ten years. He cautioned that access networks will be hard pressed to keep up with this explosion in bandwidth demand--and pleaded with the audience to get FTTH for his own home.

Pretty striking for those of us who first started programming with computers whose total memory was measured in kilobytes!

Networked Digital Television

James Sanduski, Hewlett-Packard's VP for the Digital Television Solutions business, talked about HP's connected home strategy. Jim came to HP from Samsung and is focused on networked digital television.

Jim pointed to a Yankee Group study which asked people where they wanted to watch downloaded movies. It was no surprise that most would rather watch on the TV. The study concluded "that bridge to watch a movie download on TV is absolutely critical."

HP MediaSmart TV --> Click for larger pictureHP thinks networked TVs are the answer. Jim quoted a Consumer Electronics Association (CEA) study early this year showing a rapid increase in the percentage of networked TVs, estimating that 5 million would be sold in 2010.

HP sells a line of equipment under the MediaSmart brand name, including a media server and networked TVs. Jim said HP wants to be "the brand of choice in the networked TV space" and is using "networking" as its key differentiator against the traditional consumer electronics companies.

HP is a long-time Microsoft partner, and will support the nest generation of Microsoft's Windows Media Center Extender (MCE) user interface on its MediaSmart TVs early next year. (See "Briefs" in this issue for more on MCE.)

FTTH Market Research

At each year's FTTH Conference, Michael Render, President of RVA LLC, presents an update of his latest FTTH research. This year he noted that his most recent (September 2007) cumulative tally on North American FTTH homes is 1,054,000. Because the US has lagged behind in FTTH installation, its growth is on a relatively smaller base of installation and therefore its current rate of growth (112%) is higher than Japan (55%) and Europe (35%).

One of the key advantages of fiber over asymmetric forms of broadband such as DSL and cable is its larger upstream capacity and therefore the speed of uploading it can support. A review of the actual customer FTTH customer upload speeds showed 63% between 1 and 2 Mbps, with about 11% in the 2-5 Mbps range and 25% at 1 Mbps or under.

Verizon: Inside The Home Matters

Brian Whitton of Verizon provided an update on the rollout of their FIOS service. Whitton talked about the fact that although they have been using BPON, they are moving ahead with GPON, which will allow them to increase downstream speeds by up to four times and upstream by up to eight times. Using GPON, they will transition at some point in the future from using a third wavelength for broadcast video to full IPTV. Verizon sees several benefits in doing this: the ability to more easily converge the PC, TV and mobile experiences; larger channel capacity; and targeted ad insertion with interactive ads.

Since our talks at the conference were focused on the importance of the in-home networking for the end-to-end experience, we were pleased to hear Whitton emphasize this theme. He showed several diagrams titled Home Network Evolution, with MoCA as their in-home networking technology for video, and Wi-Fi for data migrating from 802.11g to 802.11n.

Whitton talked about Verizon's differentiating features, listing picture quality, overall value proposition and category leadership in VoD, HD and multi-cultural programming. One of the enhanced features he mentioned was widgets, a blending of the Internet and the TV experiences, by which the customer gets one-click access to localized weather, traffic, etc., at the bottom of their TV screen. Other enhanced features include multi-room DVR, and "media manager"--displaying digital content from a PC to the main TV screen.

Whitton summarized what he believes the new battleground will be between service providers. It includes converged voice, data, and video applications; advanced gaming; targeted interactive advertising; mobility; and personalization. We expect that working through that list is likely to keep all service providers busy for the next several years!


Exhibits

Exhibit area --> Click for larger pictureThe show included a large exhibit area, with most of the space devoted to companies selling materials and equipment for fiber deployment. Several exhibits focused on home networking.

Dave with Jack Merrow of Leviton --> Click for larger pictureJeremy Gallagher, Telect with structured cabling panel --> Click for larger pictureLeviton and Telect showed the latest approaches in structured cabling systems, primarily used for new homes. We were familiar with the Leviton system, but the Telect system was new to us. Jeremy Gallagher showed us their color-coded ports and outlets, which simplify matching patch cords within the panel with corresponding outlets throughout the house.

Entrance to the Home Networking Zone --> Click for larger pictureMike Kunigonis of Corning --> Click for larger pictureThe Home Networking Zone was a self-contained area representing a house. The house was equipped with two fiber feeds and two optical networking units (ONUs), each feeding a home network to provide voice, video and data services. Michael Kunigonis, Product Line Manager-Access, of Corning Cable Systems, was instrumental in putting the Home Networking Zone together and hopes to continue including this area of interest at future FTTH conferences.

Asoka HomePlug AV Ethernet adapter --> Click for larger pictureRich Nesin showiing a HomePNA adapter --> Click for larger pictureThe Zone featured several technologies that could be used without installing expensive new twisted pair cabling. Asoka showed its new adapters for powerline wiring based on HomePlug AV, and the HomePNA Alliance showed the use of HomePNA to carry video and data over telephone wiring and coax. The Asoka and HomePNA demonstrations were complementary, showing how either could be used for both IP video and data.

Carina showed smart meters --> Click for larger pictureCarina Technology demonstrated how automated meter reading and other energy management applications could be incorporated into a FTTH deployment. This was interesting in the light of our attendance at the UPLC conference a few weeks earlier (see the article below).


Home Networking and FTTH

We were at the conference to conduct a post-conference workshop on Home Networking, and also gave a talk on the same subject during one of the breakout sessions. Our talk (PowerPoint, 1.4 MB) is available for download.

We observed that most FTTH deployments use separate home networks to distribute voice, video, and data services--typically with existing twisted pair, existing coax, and Wi-Fi. While this is easy--it follows the traditional approach used for cable and DSL--it separates these services into "islands". This approach made perfect sense in the old analog world, but will be an obstacle as digital media of many types comes into in the home. We think the islands will get in the way of customer wants and needs.

As an example, we pointed to all the sources of video coming through the Internet to the PC. As Jim Sanduski of HP pointed out in his talk, consumers want to watch video on the TV, not the PC. Previous articles in this newsletter have described many new technologies that could make it easier to move video from the PC to the TV. But home networks have to be engineered and installed to do so reliably, without interfering with subscription video services.

In our post-conference workshop, we described each of the new home networking technologies in detail, and discussed how they could be used by service providers in the coming world of competition for the HD screen in the living room.


Jim Farmer: A Well-Deserved Award

Jim Farmer receiving award from Cathy Harriman --> Click for larger pictureAt the closing session, the FTTH Council announced the 2007 recipients of its annual FTTH Awards. The Chairman's Award, given at the discretion of the FTTH Council's Board of Directors, was presented to Jim Farmer, CTO, Wave7 Optics. The award singles out "an individual or company that has shown tremendous effort to promote, educate or accelerate fiber".

Farmer, who spent 24 years with Scientific-Atlanta, is a pioneer in video transport and has 90 patents in the field of set top converter scrambling systems and video server systems. He has co-authored two editions of books on cable TV as well as numerous articles.

As one of the founders of Wave7 Optics, Jim was a major player in the FCC decision to free FTTH from unbundling requirements which cleared the way for Verizon to jump start its FiOS initiative.

Congratulations, Jim, on a well-deserved award!

( www.ftthconference.com ) ( www.ftthcouncil.org ) ( www.verizon.com ) ( www.discovery.org ) ( www.hp.com ) ( www.ce.org ) ( www.rvallc.com ) ( www.verizon.com ) ( www.leviton.com ) ( www.telect.com ) ( www.corningcablesystems.com ) ( www.asokausa.com ) ( www.homepna.org ) ( www.carinatek.com ) ( www.wave7optics.com )