I had a conversation today that is the same one I’ve had many times. I was talking to a City that has already built hundreds of miles of fiber to connect municipal buildings. They were shocked to hear that the network they had built had very little value if they wanted to build FTTP for all homes and businesses. To do that would require building additional fiber on just about every route they had built in the past.
In order to understand why this is so, you have to understand that there are several very different kinds of fiber networks in the world – long-haul, distribution and last mile. Each kind of these networks is built in a very different way that doesn’t make them useful for the other two uses.
Consider long-haul fiber. This is the fiber that is built to connect cities and to stretch across the country and the world. The key to having an affordable long-haul fiber route is to carry each leg of the network as far as possible without stopping and having to repeat the signals. So generally long-haul fibers will only stop in major POPs in cities or wherever necessary along the way at repeater sites that are used to boost the signal.
I have a client who is sitting on one of the major east-west Interstates in the country. Every major long-haul carrier in the country is passing very near to him with owned or leased capacity on the long-haul route. My client was shocked when not one carrier would come off of the long-haul route to provide him with bandwidth. But it’s very costly to break into long-haul fibers, and every splice creates a little interference, and so long-haul providers are generally extremely reluctant to provide bandwidth anywhere except at established POPs along the fiber.
Distribution fiber is similar to long-haul fiber, but within local fiber networks. Distribution fibers are built to connect very specific points. The networks that cable companies build to get to their neighborhood nodes are a distribution network. So are networks built by telcos to reach DSL cabinets or networks built by cities to reach traffic signals and networks built by school boards to connect schools. These networks were generally built for the specific purpose of reaching those end points.
Distribution fiber routes share the same issue as the long-haul routes and the companies that own them are generally reluctant to break these routes along the way to connect to somebody that the network was not designed for. Certainly distribution fibers have very little use for providing service to many homes or businesses. There are generally not enough pairs of fiber in distribution routes, but more importantly they are not built with access points along the way.
The major characteristic of last mile fibers (and the one that makes them the most expensive) is the presence of many access points – using handholes, manholes, splice boxes or other ways to connect to the fiber where it’s needed. Providing these access points every few hundred feet adds a lot of cost to building fiber, and it’s very expensive, and often impossible to add access points after the fact to existing distribution fiber.
This is why I actually laughed out loud last year when I read about Comcast’s 2 gigabit product that they would sell to people who were close enough to their fiber. The Comcast fiber network is almost entirely a distribution network that connects from a central hub or ring to electronic boxes in neighborhoods known as nodes. When Comcast said a customer had to be close to their fiber, they didn’t mean that fiber had to be close the home, because distribution fiber passes lots of homes and businesses. They meant that a customer had to live close to a neighborhood node which are the only access points on a cable distribution network. Cable nodes are often placed where they aren’t an eyesore for homeowners and so I laughed because in most places hardly anybody lives close enough to a Comcast node to buy the touted 2 Gig service. In a city of 20,000 like mine I would be surprised if there are more than a dozen or two homes that would qualify to buy the Comcast service.
The same is true for most of the big ISPs. Verizon has built a lot of last mile fiber with FiOS and now CenturyLink is starting to do the same. But some of the other large companies like AT&T are very happy to talk about how close they are with fiber to homes and businesses without mentioning that the vast majority of that fiber is distribution fiber, which is close to worthless for providing fiber to homes and small businesses. This is not to say that companies like Comcast or AT&T don’t have any last mile fiber. They just don’t have very much of it and it’s generally limited to business parks or to greenfield neighborhoods where they’ve installed fiber instead of copper.
It probably ought to also be mentioned that the same thing is true for conduit. I see cities all of the time saying that they’ve put conduit into the ground so that they are ready for fiber. But if you run conduit through a neighborhood without creating some access points the fiber might be nearly useless to a FTTP provider. It might cost more to try to come back later to add access points to an already buried conduit than it would cost to core a new one.
Bottom line – if you want fiber to go to every home and business, then think ahead and design in access points. But word of caution – that’s a lot more expensive.
I have a friend who has FIOS from Verizon and he showed me that the fiber stops at a central GPON distribution point / conversion box in his apartment building, then the copper within the building’s walls delivers the last connection to the customers. So it’s NOT fiber-all-the-way that many “fiber optic” pushers believe. It’s VDSL and he gets 100megs.
Ripping out all that copper is not economically feasible nor will most landlords agree to having their properties defaced to have all fiber upgrades. So I can understand why Verizon or any company that is deploying / upgrading old copper lines and equipment to state-of-the-art fiber optic systems is only doing certain areas, critical key points and not all the way. It is a headache to deal with different municipalities and property owners.
I also cannot understand why anyone would want a fast 100-meg never mind a 1 terabyte speed connection when 25 to 40-megs speeds can meet most of the needs for streaming, gaming, commerce and various other internet platforms.
Copper wireline will continue to serve last mile while fiber is replacing the middle network. G.fast is coming which is a badly needed upgrade to DSL.
Today’s blog is talking about the step before the fiber to the apartment building. If fiber or a conduit passes an apartment complex with no local access point to reach the premise, then that apartment (or home or business) is not going to ever be connected to fiber. Fiber can, and often does pass through a neighborhood without a realistic ability to serve anybody on that neighborhood.
As to why people want speeds faster than 100 Mbps, I just remind you that at every step along the way to the speeds we have today there was always somebody asking why people would need that much speed. I remember that same conversation happening when we all of a sudden had 1 Mbps DSL instead of dial-up. Many people thought that speed would be sufficient for many years, and instead it was obsolete in a fairly short time.
Since about 1980 we’ve seen the amount of bandwidth needed at homes double every three years and there is currently no reason to think we are at the end of that growth curve. It’s funny that you mention that if somebody has 25 – 40 Mbps that they probably don’t need more. Because 2 years ago when the FCC said that homes need 25 Mbps all of the ISPs said that number was crazy. And already within two years you’ve added the ‘up to 40 Mbps’ onto that definition. There are already homes that really need the 100 Mbps, but not that many of them. But if the average home needs 25 Mbps today, then using the growth curve, within six years the average home is going to want 100 Mbps. Six years is almost no time at all when building and designing networks.
A real question here is why the legacy incumbent telephone and cable companies make assertions about their fiber infrastructure that make their service capabilities appear far greater than they actually are. For whom are these exaggerations intended and what is their purpose?
I think it’s generally very clear about why they exaggerate where they have fiber. It’s almost always aimed at regulators, but also a little bit towards investors and stockholders. For instance, because of the deal that AT&T made with the FCC that requires them to ‘pass’ certain numbers of homes and businesses within a set time frame, the company is very motivated to say that they have done so. But if these places are ‘passed’ with fiber that has no local access point to really serve them, then in real life they are not really passed at all, but perhaps have been bypassed.
My guess is the regulators aren’t being fooled and that the intended audience is investors and the less knowledgeable elements of the business media. The whole point of distribution infrastructure is to serve end user premises. But if it costs too much to do so as you suggest, then the overall business model is fundamentally broken. It’s understandable the companies would want to obfuscate that inconvenient truth. The implication is we must pursue alternatives business models that will meet our telecommunications needs now and in the future.
Another great article Doug! It is so difficult to have a productive conversation with an incumbent provider because, when they will talk with you, the conversation might be accurate, it is not helpful.
Particularly when the carrier is motivated to tell you something other than the absolute truth!
Dear Doug:
Great article! A couple of things —
(1) Fiber is not always fiber, just like a road is not always a road, and this just makes sense. We react differently when different roads are built in front of our house, depending whether the new road is a neighborhood street, or the Capitol Beltway (I-495)!! Sure, the road builder will connect your driveway to the neighborhood street, even in most circumstances if the new road is US Route 1. However, they will not do so if your driveway would empty onto I-495…
(2) What this proves is that the fiber carriers are telling their different constituencies what the constituencies want to hear. And yes, only folks that are fooled are the bottom-fishing, shallow, dumb media, who with a little more research and effort into their stories, could really do a public service by getting the story right (instead of just fast…). Shame on them…