Cellular Networks and Fiber

We’ve known for a while that the future 5G that the cellular companies are promising is going to need a lot of fiber. Recently Verizon CEO Lowell McAdam verified this when he said that the company will be building dense fiber networks for this purpose. The company has ordered fiber cables as large as 1,700 strands for their upcoming build in Boston in order to support the future fiber and wireless network there. That’s a huge contrast from Verizon’s initial FiOS builds that largely built a network using mostly 6-strand fibers in a lot of the Northeast.

McAdams believes that the future of urban broadband will be wireless and that Verizon intends to build the fiber infrastructure needed to support that future. Of course, with that much fiber in the environment the company will also be able to supply fiber-to-the-premise to those that need the largest amounts of bandwidth.

Boston is an interesting test case for Verizon. They announced in 2015 that they would be expanding their FiOS network to bring fiber to the city – one of many urban areas that they skipped during their first deployment of fiber-to-the-premise. The company also has engaged with the City government in Boston to develop a smart city – meaning using broadband to enhance the livability of the city and to improve the way the government delivers services to constituents. That effort means building fiber to control traffic systems, police surveillance systems and other similar uses.

And now it’s obvious that the company has decided that building for wireless deployment in Boston is part of that vision. It’s clear that Verizon and AT&T are both hoping for a world where most devices are wireless and that the wireless connections use their networks. They both picture a world where their wireless is not just used for cellphones like today, but will also be used to act as the last mile broadband connection for homes, for connected cars, and for the billions of devices used for the Internet of Things.

With the kind of money Verizon is talking about spending in Boston this might just become the test case for a connected urban area that is both fiber rich and wireless rich. To the extent that they can do it with today’s technology it sounds like Verizon is hoping to serve homes in the City with wireless connections of some sort.

I’ve discussed several times how millimeter wave radios have become cheap enough to be a viable alternative for bringing broadband to urban apartment buildings. That’s a business plan that is also being pursued by companies like Google. But I still am not aware of hardware that can reasonably be used with this same technology to serve large numbers of single family homes. At this point the electronics are still too expensive and there are other technological issues to overcome (such as having fiber deep in neighborhoods for backhaul).

So it will be interesting to watch how Verizon handles their promise to bring fiber to the homes in Boston. Will they continue with the promised FTTP deployment or will they wait to see if there is a wireless alternative on the horizon?

It’s also worth noting that Verizon is tackling this because of the density of Boston. The city has over 3,000 housing units per square mile, making it, and many other urban centers, a great place to consider wireless alternatives instead of fiber. But I have to contrast this with rural America. I’m working with several rural counties right now in Minnesota that have housing densities of between 10 and 15 homes per square mile.

This contrast alone shows why I don’t think rural areas are ever going to see much of the advantages of 5G. Even though it’s expensive to build fiber in a place like Boston, the potential payback is commensurate with the cost of the construction. I’ve always thought that Verizon made a bad strategic decision years ago when they halted their FiOS  construction before finishing building in the metropolitan areas on the east coast. Verizon has fared well in its competition with Comcast and others.

But there is no compelling argument for the wireless companies or anybody else to build fiber in the rural areas. The cost per subscriber is high and the paybacks on investment are painfully long. If somebody is going to invest in rural fiber they might as well use it to connect directly to customers rather than to spend the money in fiber plus adding a wireless network on top of it.

We are going to continue to see headlines about how wireless is the future, and for some places like Boston it might be. Past experience has shown us that wireless technology often works a lot different in the field compared to the lab, so we need to see if the wireless technologies being considered really work as promised. But even if they do, those same technologies are going to have no relevance to rural America. If anything the explosion of urban wireless might further highlight the stark differences between urban and rural America.

One thought on “Cellular Networks and Fiber

  1. “But there is no compelling argument for the wireless companies or anybody else to build fiber in the rural areas”
    1. If the market driver is consumer internet access, I agree
    2. If an autonomous vehicle driving along say US 160 is southern Colorado, then SOMEONE is going to have to build a fiber network along the roadway to serve the 4,000 GB that vehicle needs every day to operate
    3. IoT/smart grid: electric utilities can’t burn coal/operate as a 20th century power company forever. Smart grid calls for a separate data network. Power utilities, if they do not already do so, will have to build massive data networks to support their operations including distributed generation

    Like

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