Burnstein on VDSL2
Dave Burnstein [daveb@dslprime.com] writes the informative (FREE) DSL Prime email newsletter. Send him an email with “subscribe” in the subject. Here’s what the “round fellow with a beard” (as he calls himself) has to say about VDSL2+.
VDSL2 When? 2005?, 2006?, 2007-2008Some today, some delayed
2005
Fiber to the basement.
Ikanos just had a $25M quarter – with a $3M GAAP profit – so clearly some VDSL sales are improving in 2005. Rajesh Vashist expects another 10% sales gain this quarter, almost exclusively going to Asian fiber to the basement rollouts. XyZEL has sold 2M ports for that application, even before the Chunghwa deal, probably the largest VDSL total to date. This is a controlled rollout, easy for the carrier to avoid compatibility and interference problems. Only Belgacom is speaking publicly about currently deploying VDSL from the neighborhood node, perhaps than 3,000 feet away. VDSL in 2005 is less than 5% of the new DSL ports, and very few outside Asia.
2006
Korea and Japan have ambitious plans
despite capex issues, with weakness at Hanaro possibly allowing KT to slow down. SBC and Deutsche Telecom between them plan 30 million ports of VDSL, but may go slowly in 2006.
Will fiber to the node/VDSL reach any volume? That is the SBC strategy, using existing boxes at 3,000 to 6,000 feet and looking for 25 meg down for video. Randall at Goldman officially confirmed what I have previously reported, that only very limited work will proceed until May or June at the earliest. He added that a house at 2,500 feet achieved 40 megabits down, and one at 4,000 feet reached 25 megabits. If Chris Rice at USTA takes questions, I’ll ask what field results they can share and whether those speeds will be likely when multiple lines in the binder are running at high speed. Vashist expects substantial U.S, VDSL in the second half, but he built Ikanos by being a true believer and enthusiastic salesman. Anton Wahlman, whose sources are usually impeccable, doubts any volume from Lightspeed before 2007. Vashist confirms my report Swisscom will move forward in Q1 with a similar build, probably with shorter average loops. The cable guys are hurting them badly.
Deutsche Telekom, on the other hand, intends a short loop build for speeds of 50 meg or more. That’s because unbundlers are clobbering them because Matthias Kurth had the courage to protect competition. I’ll shake his hand happily when he comes to Columbia this week. BellSouth has a million lines of fiber to the curb in place, which they intend to bring to 50 meg and might begin in 2006. The old Marconi equipment, now serviced by AFC/Tellabs, can be upgraded as soon as the CFO agrees to spend the money. Perhaps Wegleitner in Vegas can give me some insight on the timing, and Vashist will be surprised how soon Verizon takes Manhattan.
Expect a minimum of five million lines, but if big carriers decide to move the total could be triple that. The “integration problems” Randall bemoaned with Microsoft TV could slow things down; it’s becoming clear SBC’s choosing such a proprietary system puts them in a bind.
2007
Will 2007 be the year VDSL substitutes for ADSL
in most new installations? Bill Smith says BellSouth will switch “when the price and reliability is right.” VDSL2 should really be called ADSL3, which would make the progression obvious, but industry politics created confusion. The chips are designed to do everything ADSL2+ does and more. If they had called it ADSL3, more people would realize the progression is inevitable. The $66 price is close to the $47 Chunghwa recently paid for ADSL2+, suggesting the price issue will be soon solved. VDSL2‘s quality still is unproven, the key barrier to general deployment. Besides interoperability, many features such as the promised long reach haven’t been proven in any field deployment. While the price per chip is coming down, VDSL power and space requirements need improvement. Lucent’s launched their new gbox, to replace the Stinger next year, and the ADSL capacity is twice what what they offer with VDSL. No one has shown me a line-powered VDSL remote, a critical issue for units deployed outside. Line-powered remotes (powered by one of the telco cables already in place) were critical to the cost-effective spread of ADSL, because it often costs more to bring mains power to a field pedestal than to install the DSL gear.
VDSL chip volume will pass 60M ports a year, but the switchover date remains to be seen. TI, whose UDSL chip is making progress, reminds me that while VDSL is the exciting news, ADSL2 is currently selling very well.