Are You Ready for 10 Gbps?

Around the world, we’re seeing some migration to 10 Gbps residential broadband. During the last year the broadband providers in South Korea, Japan, and China began upgrading to the next-generation PON and are offering the blazingly fast broadband products to consumers. South Korea is leading the pack and expects to have the 10 Gbps speed to about 50% of subscribers by the end of 2022.

In the US there are a handful of ISPs offering a 10 Gbps product, mostly for the publicity – but they stand ready to install the faster product. Notable is Fibrant in Salisbury, NC and EPB in Chattanooga. EPB which was also among the first to offer a 1 Gbps residential product a few years ago.

I have a lot of clients who already offer 10 Gbps connections to large business and carrier customers to serve large businessesn like data centers and hospital complexes. However, except for the few pioneers, these larger bandwidth products are being delivered directly to a single customer using active Ethernet technology.

There are a few hurdles for offering speeds over a gigabit in the US. Perhaps foremost is that there are no off-the-shelf customer electronics that can handle speeds over a gigabit – the typical WiFi routers and computers work at slower speeds. The biggest hurdle for an ISP continues to be the cost of the electronics. Today the cost of next-generation PON equipment is high and will remain so until the volume of sales brings the per-unit prices down. The industry market research firm Ovum predicts that we’ll see wide-spread 10 Gbps consumer products starting in 2020 but not gaining traction until 2024.

In China, Huawei leads the pack. The company has a 10 Gbps PON system that is integrated with a 6 Gbps WiFi 6 router for the home. The system is an easy and overlay on top of the company’s traditional GPON network gear. In South Korea the largest ISP SK Broadband has worked with Nokia to develop a proprietary PON technology only used today inside of South Korea. Like Huawei, this overlays onto the existing GPON network. In Japan the 10 Gbps PON network is powered by Sumitomo, a technology only being sold in Japan. None of these technologies has made a dent in the US market, with Huawei currently banned due to security concerns.

In the US there are two technologies being trialed. AT&T is experimenting with XGS-PON technology. They plan to offer 2 Gbps broadband, upgradable to 10 Gbps in the new high-tech community of Walsh Ranch being built outside of Ft. Worth. AT&T is currently trialing the technology at several locations within its FTTP network that now covers over 12 million passings. Verizon is trying the NG-PON2 technology but is mostly planning to use this to power cell sites. It’s going to hard for any ISP to justify deployment of the new technologies until somebody buys enough units to pull down the cost.

Interestingly, Cable Labs is also working on a DOCSIS upgrade that will allow for faster speeds up to 10 Gbps. The problem most cable networks will have is in finding space of their network for the needed channels to support the faster speeds.

There are already vendors and labs exploring 25 Gbps and 50 Gbps PON. These products will likely be used for backhaul and transport at first. The Chinese vendors think the leap forward should be to 50 Mbps while other vendors are all considering a 25 Mbps upgrade path.

The real question that needs to be answered is if there is any market for 10 Gbps bandwidth outside the normally expected uses like cellular towers, data centers, and large business customers. This same question was asked when EPB at Chattanooga and LUS in Lafayette, Louisiana rolled out the earliest 1 Gbps residential bandwidth. Both companies were a bit surprised when they got a few instant takers for the faster products – in both markets from doctors that wanted to be able to analyze MRIs and other big files at home. There are likely a few customers who need speeds above 1 Gbps, with doctors again being good candidates. Just as broadband speeds have advanced, the medical imaging world has grown more sophisticated in the last decade and is creating huge data files. The ability to download these quickly offsite will be tempting to doctors.

I think we are finally on the verge of seeing data use cases that can eat up most of a gigabit of bandwidth in the residential environment. For example, uncompressed virtual and augmented reality can require masses of downloaded data in nearly real-time. As we start seeing use cases for gigabit speeds, the history of broadband has shown that the need for faster speeds is probably not far behind.

Fiber Electronics and International Politics

In February six us Intelligence agencies warned Americans against using cellphones made by Huawei, a Chinese manufacturer. They warned that the company is “beholden” to the Chinese government and that we shouldn’t trust their electronics.

Recently Sen Liz Cheney introduced a bill into Congress that would prohibit the US Government or any contractors working for it to use electronics from Huawei or from another Chinese company ZTE Corp. Additionally, any US military base would be prohibited from using any telecom provider who has equipment from these two vendors anywhere in their network.

For anybody who doesn’t know these two companies, they manufacture a wide array of telecom gear. ZTE is one of the five largest cellphone makers in the world. They also make electronics for cellular networks, FTTP networks and long-haul fiber electronics. The company sells under it’s own name, but also OEMs equipment for a number of other vendors. That might make it hard for a carrier to know if they have gear originally manufactured by the company.

Huawei is even larger and is the largest maker of telecom electronics in the world, having passed Ericsson a decade ago. The company’s founder has close ties to the Chinese government and their electronics have been used to build much of the huge wireless and FTTP networks in China. The company makes cellphones, FTTP equipment and also is an innovator in equipment that can be used to upgrade cable HFC network.

This is not the first time that there has been questions about the security of electronics. In 2014 Edward Snowden released documents that showed that the NSA had been planting backdoor software into Cisco routers being exported overseas from the US and that these backdoors could be used to monitor internet usage and emails passing through the routers. Cisco says that they had no idea that this practice was occurring and that it was being added to their equipment after it left their control.

Huawei and ZTE Corp also say that they are not monitoring users of their equipment. I would assume that the NSA and FBI have some evidence that at least the cellphones from these companies can be used to somehow monitor customers.

It must be hard to be a telecom company somewhere outside of the US and China because our two countries make much of the telecom gear in wide use. I have to wonder what a carrier in South America or Africa thinks about these accusations.

I have clients who have purchased electronics from these two Chinese companies. In the FTTP arena the two companies have highly competitive pricing, which is attractive to smaller ISPs updating their networks to fiber. Huawei also offers several upgrade solutions for HFC cable networks that are far less expensive than the handful of other vendors offering solutions.

The announcements by the US government creates a quandary for anybody who has already put this gear into their network. At least for now the potential problems from using this equipment have not been specifically identified. So a network owner has no way of knowing if the problem is only with cellphones, if it applies to everything made by these companies, or even if there is a political nature to these warnings rather than a technical one.

Any small carrier using this equipment likely cannot afford to remove and replace electronics from these companies in their networks. The folks I know using ZTE FTTP gear speak high praises of the ease of using the electronics – which makes sense since these two companies have far more installed fiber customers worldwide than any other manufacturer.

Somebody with this equipment in their network has several quandaries. Do they continue to complete networks that already use this gear or should they somehow introduce a second vendor into their network – an expensive undertaking. Do they owe any warnings to their own customers (at the risk of losing customers). Do they do anything at all?

For now all that is in place is a warning from US intelligence agencies not to use the gear, but there is no prohibition from doing so. And even should the Senate bill pass it would only prohibit ISPs using the gear from providing telecom services to military bases – a business line that is largely handled by the big telcos with nationwide government contracts.

I have no advice to give clients on this other than to strongly consider not choosing these vendors for future projects. If the gear is as bad as it’s being made to sound then it’s hard to understand why the US government wouldn’t ban it rather than just warn about it. I can’t help but wonder how much of this is international wrangling over trade rather than any specific threat or risk.

Industry Shorts – August 2016

ATTThe following are a few topics I which found interesting but don’t require a full blog entry:

FCC to Allow Cable Black-outs. The FCC has officially decided that it is not going to intervene in the many disputes we see these days between programmers and cable operators. Only a few years ago this was a fairly rare occurrence, but you can’t read industry press without seeing some new dispute – many of which are now leading to content black-outs when the two sides can’t reach a resolution.

The FCC has always been allowed to intervene in disputes and routinely did so a decade ago. The American Cable Association which represents small and medium cable companies wants the FCC to be more active today to protect against abuses by the programmers, but the agency has decided to let the market work to resolve disputes. There have been over 600 blackouts since 2010 and the frequency seems to be accelerating.

Blogger Loses Life’s Work. Google recently hit the news when it disabled access to 14 years of blogs as well artwork, photograph, a novel and even the Gmail account that was being stored online by Dennis Cooper. The blogger claims he received no notice until his work disappeared and Google won’t tell him why he was cut off or if his content still exists. Cooper’s blog always contained controversial content and was a popular destination for fans of experimental literature and avant-garde writing.

His case highlights the intersection of first amendment rights versus the ability of private corporations like Google to allow or not allow content on their private platforms. Google has slowly been cutting back on storage services such as Google News Drives and Google Groups and Cooper’s content might not even still exist. If anything, this case highlights the importance of backing up content offline. It also raises the issue of how permanent anything is on the web.

AT&T Testing Drone Cell Sites. AT&T has been testing the use of drones as flying cell sites to use during big events. Large events always overwhelm local cellular sites and drones might be the answer to give access to many people in a concentrated area.

The company has already been using a technology that it calls COWs (Cells on Wheels) that are brought to large sporting events to provide more coverage. But the hope is that drones can be deployed more quickly and for a lower cost and provide better service. Of course, this just means more of a phenomenon I’ve seen a few times in recent years where people in the stands at a football game are watching the same game on their cellphone instead of looking at what is in front of them.

Huawei Creates 10 Gbps Cable Platform. We are in the earliest stages of deployment of gigabit broadband using DOCSIS 3.1 on cable systems and Chinese vendor Huswei claims to have already created a 10 Gbps platform using the new standard.

The company faces several hurdles to deploying the technology in the US since the company is under scrutiny by the US for doing business with North Korea and with Iran during the recent embargo. But the biggest issue with a cable company offering gigantic bandwidth over coaxial cable is freeing up enough bandwidth in a cable TV network to do so. Cable companies have to free up at least 24 empty channels to offer a gigabit over coax and it seems unlikely that are willing to try to open up a lot more channels than that for higher bandwidth. The only realistic scenario for going much larger than a gigabit is to migrate a cable network to IPTV and make the whole network into a big data pipe – but this is a very costly transition that means a new headend and new settop boxes. .

Facebook Develops Mobile Access Point. Facebooks has developed a shoebox size access point that can support wireless transmissions including 2G, LTE and WiFi. The box is hardened for the harshest conditions, is relatively low-powered and is intended as a way to expand Internet coverage around the world in poorer areas. Most of the world now connects with the Internet wirelessly and this access point can enable customers with a wide range of devices to gain access.

 

US Telcos Indifferent to G.Fast

Speed_Street_SignG.Fast is a new technology that can deliver a large swath of broadband over copper wires for a short distance. The technology uses some of the very high frequencies that can travel over copper, much in the same way that DSL does for lower frequencies.

The International Telecommunication Union (ITU) just approved the final standard for the technology with the G.9701 standard for “Fast Access to Subscriber Terminals.” Several vendors including Alcatel-Lucent and Huawei have been producing and testing units in various field trials.

British Telecom has done a number of these tests. The largest such test was started in August for 2,000 customers in Huntingdon, Cambridgeshire. During the trial they are offering customers speeds of 330 Mbps, but they expect at the end of the trial to be able to raise this to about 500 Mbps.

The technology involves building fiber along streets and then using the existing copper drops to bring the bandwidth into the home. This is the most affordable kind of fiber construction because a telco can overlash fiber onto its existing copper wires on the poles. That means very little make-ready work, no permits needed, and no impediments to quick construction. This kind of fiber construction can literally be done at half of the cost faced by other fiber overbuilders.

British Telecom has done a number of trials across the country. Alcatel-Lucent has also done trials with Telkom Austria. But for the most part American telcos have shown no interest in the technology. The only real trial here that I’ve read about is a trial with CenturyLink in Las Vegas.

And I frankly don’t understand the reluctance. G.Fast is a halfway solution on the way to a full fiber deployment. As cable companies and overbuilders like Google are stepping up deployment of gigabit speeds, either through fiber or through fast cable modems using DOCSIS 3.1, the telcos have been announcing fiber builds to remain competitive. AT&T has announced gigabit fiber builds in more than twenty markets. CenturyLink says it will be passing 700,000 homes with fiber in 2016.

So why wouldn’t an American telo seriously consider G.Fast? With capabilities up to 500 Mbps in real-world applications it gives them a product that can compete well with other fast technologies. And by overlashing the fiber to deploy G.Fast the telco will have tackled one of the major costs of building an FTTP network, by getting the fiber deep into the network. And with G.Fast a telco can avoid the expensive fiber drops and electronics which are the most expensive part of a FTTP network for them.

I could envision somebody like CenturyLink building fiber to the more lucrative parts of town while deploying G.Fast to older copper neighborhoods. This would give them a far greater fast broadband coverage, making it easier and more cost effective to advertise their broadband.

But it seems like most of the US telcos just want out of the copper business. And so, rather than take this as an opportunity to milk another decade out of their copper networks before finally building fiber, they seem prepared to cede even more broadband customers to the cable companies. That has me scratching my head. The cable companies have clearly accepted that their entire future is as ISPs and that data is the only real product that will matter in the future. It just seems that the large telcos have not quite yet come to this same conclusion.

Huawei in the US

Huawei Many western governments have banned Huawei, the Chinese equipment manufacturer from bidding on government contracts. In the US the government warned the industry against using Huawei because of security concerns and most of the large carriers have said that they won’t use their equipment. But Huawei is not officially banned from the US and they are now making proposals to sell equipment to smaller carriers like independent telcos.

Huawei can make a convincing sales pitch. It’s been reported that their equipment runs about 30% less expensive than similar equipment made by Calix, Adtran and Metaswitch. Since small telcos have been losing historical revenues on many fronts they are feeling pressured to do everything possible to find ways to be competitive and survive. So any offer for less expensive equipment can look really attractive.

Huawei is an interesting company. The company was supposedly founded on a shoestring by founder Ren Zhengfei and has grown to be the number one telecom equipment manufacturer in the world. There are reportedly over three billion customers on Huawei-made cellular networks. But this was not your typical startup and the company got a huge leg up with gigantic early orders from the Chinese government. They are successful in large part due to being the preferred equipment manufacturer in the exploding Chinese market. But Ren has never given a public interview and is a mystery to the world.

It’s understandable that western governments would be nervous about allowing Huawei equipment in US government offices. There is some fear that the Chinese government could somehow build spyware into the operating software. But are there any reasons for the government to block Huawei from selling to general network providers? Should telcos have any fear of using their equipment?

The only fear I can think of is that there might be a hidden Trojan horse inside the operating software that could allow Huawei to shut down networks remotely should the US and China ever get at odds with each other. But this just doesn’t seem like a credible threat to me. This would only have to be done once to any network anywhere and Huawei would be forever shunned outside of China. And while such a shutdown could be devastating to the network involved, this would not be hugely crippling to the US economy.

A more credible reason to not use Huawei is that they are not a good corporate citizen. Cisco has found large swaths of Cisco code, right down to syntax and punctuation errors in Huawei operating software. Huawei seems to come out with innovations very soon after they are announced elsewhere and they clearly do not have any notice or respect for western patents. Stealing technology and software so blatantly would not be tolerated in the western world and any manufacturer caught doing this would be sued out of existence.

So western network owners are faced with a dilemma. They can buy tried and trusted equipment from the largest manufacturer in the world at significant discounts. Or they can boycott Huawei for philosophical reasons. Companies that steal US technology ultimately do our economy a lot of harm, and this is reason enough in my mind to boycott them for their bad behavior.