'No Incentive' For Fiber > ?

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blips join:2001-04-17 Addison, IL	? Is the $2000 price to existing homes? What about new housing developments? How much would it cost to put fiber down instead of laying copper? It can't be that much more.
	permalink · 2003-09-10 09:51:01 · ·

ronpin
Imagine Reality

join:2002-12-06
Nirvana

Re: ?

said by blips:
Is the $2000 price to existing homes? What about new housing developments? How much would it cost to put fiber down instead of laying copper? It can't be that much more.

The price of the [triple-play]ONU is up to $1200. Thats why the ONU vendors greased themselves up for massive price cuts -- hoping for some huge volume orders from the likes of SBC. SBC could produce their own ONU's a lot cheaper.
Let's face it, it you grossed 100 billion a year on your copper lines -- why exactly would you want to spend 100 billion to upgrade to fiber???

permalink · 2003-09-10 09:54:21 · Print ·

wentlanc You Can't Fix Dumb.. join:2003-07-30 Maineville, OH	Fiber is about 10 times the cost of copper. But still, it would be worth the price. It would be like getting a $1000 PC with 128 megs of RAM instead of spending $1045 for the same PC with 512 megs. So you cut some off of the price. But the performance will suck as a result, and you lose the initial investment when you have to swap it out later. puritan
	permalink · 2003-09-10 09:57:59 · ·

bmn ? ? ? Premium,ExMod 2003-06 join:2001-03-15 hiatus	Re: ? said by wentlanc: Fiber is about 10 times the cost of copper. Actually, the price differential is lower than that and is still falling. but you are correct, it is worth the price. Fibre offers well over a tenfold return on investment when capacity, durability and lifespan are taken into account. -- If you could read my mind, here's what you'd see.. Kinda.
	permalink · 2003-09-10 15:00:44 · Print · ·

calvoiper

join:2003-03-31
Belvedere Tiburon, CA

Re: ?

As compared to installing new copper, sure.

But when compared to using existing, already paid for, old copper, the fiber is a new expense.

Anybody can justify why your company should buy you a new XP-Pro PC as opposed to buying you an obsolete Win98 PC. But if the company already owns the obsolete PC, replacing it with a new one is a different cost.

Calvoiper
--
VoIP--the death knell of remaining voice monopolies!

permalink · 2003-09-10 23:34:53 ·

bmn ? ? ? Premium,ExMod 2003-06 join:2001-03-15 hiatus	Re: ? said by calvoiper: As compared to installing new copper, sure. But when compared to using existing, already paid for, old copper, the fiber is a new expense. You've forgotten, the Bells have already received the money to build the new fibre network many times over. Its not like the Bells don't have the money. -- Male by birth... Geek by choice.
	permalink · 2003-09-10 23:36:50 · Print · ·

calvoiper join:2003-03-31 Belvedere Tiburon, CA	Re: ? Oh, I know what you say is true. I was only explaining their mindset--not defending it. Calvoiper -- VoIP--the death knell of remaining voice monopolies!
	permalink · 2003-09-16 04:15:31 · ·

tschmidt
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join:2000-11-12
Milford, NH
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Fiber to the Premise (FTTP) costs around $1500-3000 per customer at reasonable take rates. Customer drop wiring and premise equipment are about 1/3 the total cost. As Ronpin pointed out the triple play Optical Network Unit (ONU) emulating Cable TV and Analog POTS typically run around $1200 US.

Here in NH we are in the early stage investigation of municipal FTTP. We are looking at a under $2000 per customer for a pure play IP FTTP network. That means the network will not include provisions for emulating CATV or POTS. These services are carried over IP.

To put these costs into perspective I remember reading an old AT&T study that copper POTS cost about $1200 per subscriber and CATV about $800. Much of the cost is installation labor rather then the technology itself.

Since FTTP only requires a single connection to deliver all services it is cost effective today. The reason things are going so slow it is much more profitable for incumbents to extend the life of their legacy network to deliver high-speed access then build a new network. A $2000-3000 CAPEX investment with a $50-100 a month revenue opportunity can be very attractive to the right player.

The risk faced by the incumbents is if a new player, such as Ronpin, is able to obtain funding to deploy a FTTP network In that case the incumbent network becomes uncompetitive. What you are likely to see in the near term are a number of delaying tactics allowing incumbents to defer the investment as long as possible. This is shaping up as an interesting contest. One only need look at history to understand dominant players in “old” technology rarely make the transition when faced with disruptive technology.

Horse and Buggy >> Horseless carriage
Telegraph >> Telephone
Vacuum Tube >> Transistor
Transistor >> Integrated circuit
Mainframe >> Mini computer
Mini computer >> PC

permalink · 2003-09-10 10:40:44 · Print ·

calvoiper

join:2003-03-31
Belvedere Tiburon, CA

Re: Incumbent vs Overbuilder

Very well said.

I hope to soon enjoy speaking of SBC, Verizon, BellSouth with the likes of Acme Buggy, Western Union, RCA, Fairchild Semiconductor, Sperry/Burroughs/DEC.

As for the economics, a 12% return on $2K/customer works out to $20/month--something less than what most whining Baby Bells now want to charge for a standalone copper loop. Frankly, these guys have no idea of how far behind they really are--but that doesn't stop them from trying to see nobody else gets ahead, either.

Calvoiper
--
VoIP--the death knell of remaining voice monopolies!
[text was edited by author 2003-09-10 23:44:02]