GPON

Ericsson’s GPON competition with Alcatel-Lucent

Ericsson, which has hardly a household word in wireline infrastructure, may be gaining traction in GPON deployment in China, and we’re hearing that the company is also looking stronger in Europe. GPON deployment on a larger scale is an interesting shift because it permits delivery of broadcast TV as RF-over-glass rather than as IPTV.

An increasing number of providers are telling us that they believe that the RFoG model is better, resulting in a higher first cost but focusing that cost on the most durable and leverageable asset—fiber. Ericsson could play this card effectively against Alcatel-Lucent, which has been conflicted in its PON-versus-IPTV internal debate for more than a year.

Metro and access drive ‘09 deployment focus

It is becoming increasingly clear that 2009 will see the most action in the metro and access space. Worldwide, operators are looking very hard at FMC and femtocells, and we believe that there will be some deployments even in the US by 2H09.

There are also a number of competitive initiatives from competitive access providers aimed at Ethernet services and enterprise customers, attempting to play off the corporate desire to gain headroom in access to leverage with later tactical purchases of services.

 Our research is showing that worldwide focus on infrastructure spending will be strongly in the access/metro direction in 2009 and even in 2010.

NSN moves on to next-generation optical access

Nokia Siemens Networks (NSN) has announced it will not continue to invest in GPON, focusing instead on DSL and next-gen optical access (NGOA).

The decision, we believe, is attributable to a number of factors, including the truth that PON in any form is not universally feasible (where demand density is low it won’t recover costs at current price points).  In addition, vendors including ALU already have a substantial lock on the GPON business, and an NGOA that combines fiber remote and DSL or multimedia over oaxial cable access (MoCA) with PON could be the real long-term winner. We’re hearing interest in this last point from both carriers and equipment vendors.

AT&T bids out GPON-based FTTH

AT&T is working through its bidding process for GPON-based FTTH for new developments, a move that takes the company further down the path Verizon has already taken. It is not known how much of the Verizon architecture AT&T will mimic, and in particular if it will use the same linear RF broadcast TV delivery program over its own channel-slot Microsoft TV approach. How this plays out will be of enormous importance to equipment vendors because the decision to use FTTH and PON in any form bends the budget decisively toward the access network and empowers players like Alcatel-Lucent who can bid there. The fact that GPON empowers Alcatel-Lucent has been the seed of the internal battle between the GPON group and the router group, who don’t want broadcast over fiber at all.