Tellabs Inspire Magazine: Rural Ops Bridge The Digital Divide

ARTICLE REPRINT — TELLABS INSPIRE Q3 2008

Rural Ops Bridge the Digital Divide some of the most advanced technologies are being deployed in small towns. here’s why. By M.J. Richter

A few years ago, most Independent Operating Companies (IOCs) realized that long-term success in a technology-driven market would depend at least in part on their ability to deploy broadband-access networks. Pulled by customers’ demands for more bandwidth and pushed by growing competition from cable TV operators, many IOCs subsequently decided to build networks that could deliver the all-important triple play of video, data and voice services, particularly HDTV, IPTV and VoD. Having answered that call, IOCs and other triple-play service providers now look to leverage those initial investments while planning for future offerings. Their challenge, at its core, is to both plan ahead for tomorrow’s end-user needs and make the right underlying technology choices to flexibly meet those demands.

Reversing the Digital Divide The success of the IOCs’ access-network strategies is already apparent in the communications infrastructures of many of the United States’ smaller cities, towns and rural areas. Collectively, those geographic regions make up one of the fastest growing sectors of the domestic broadband marketplace. Joe Savage, president of the FTTH Council, points out that Tier-3 IOCs and telephone cooperatives — with nearly 6 percent of all their access lines now FTTH connections — are often leaders when it comes to providing customers with broadband access. “Of course, the RBOCs lead in total number of subscribers, with nearly 70 percent of all FTTH subscribers,” Savage said. “[But]

IOCs and municipalities were the first to deploy FTTH, in some cases three years ahead of the larger RBOCs. Small IOCs, especially co-ops, are leading the way in transitioning to FTTH, driven by the subscriber/owners’ desire to reverse the digital divide in America.”

In the Driver’s Seat IOCs across the United States are in the vanguard of domestic FTTH deployments, with many of them opting for GPON technology to power those networks. That begs the question, are FTTH deployments driving IOC selection of GPON technology, or does GPON technology drive IOC decisions to deploy FTTH networks? Savage said the answer is “a little bit of yin and yang.” “Service providers see the large majority of networks being deployed are PON-based and think, ‘If it’s good for those providers, it must be good for us,’” Savage explained. “In many cases, because of subscriber density, the savings provided by PON systems in optical fiber and cable drive the technology choice to PON. And with GPON available today, most service providers go with the latest, rather than deploy BPON and know they will be upgrading in a few years to GPON anyway.” Service provider demand for more bandwidth appears to be insatiable. “If 10-Gbps GPON were available today, I believe that is what the technology service providers would deploy,” Savage said. “As GPON volume goes up, service providers recognize there is safety in numbers, and prices will continue to decline.”

Small Town Living, Big City Technology Grant Griffiths is a former attorney who lives in Clay Center, a town of about 4,300 residents in northeast Kansas. In 2005, he closed his downtown office and shifted his practice to his residence. His legal assistant moved from Clay Center to a new home four hours away. Despite operating out of different locations, the two remained a team until Griffiths recently decided to close his practice and switch to consulting work and a Web-building service for other lawyers. He explained the arrangement: “We communicated and exchanged documents via e-mail. I recorded dictation files digitally and sent them to her in e-mails as digital files. She sent the documents back to me, and then I did with them what I needed to do.” With high-speed network access, Griffiths said, “you don’t have to be in the same

office or even the same town to have someone work for you.” As various service providers offered various access technologies, Griffiths signed up for each one, always looking for as much bandwidth and reliability as he could get. “I started out with the cable modem because that was the only option at the time. Then we had DSL, and I switched to that pretty quickly. I got 6 Mbps download service, and I paid extra to get that. Most people weren’t getting half that much speed.” As of August 2008, Griffiths has the fastest possible access: an FTTH connection. Service providers understand that most customers don’t care what underlying access technology they use, as long as it is fast and reliable. Griffiths said those are the

only criteria for anyone working in a home office, “unless you’re a complete technogeek, which isn’t a bad thing. The bottom line is, the technology just needs to work, it needs to be reliable and it has to deliver the bandwidth.” The now-expanding FTTH network in and around Clay Center will, in Griffiths’ opinion, have a positive effect on the town’s overall population and economy. He believes that rural areas in general, and Clay Center in particular, are catching up with America’s urban areas, “especially now that we’re getting fiber optics. “I’ve got friends in large cities who don’t have fiber connections. Here, the local telephone company that’s been in existence for a number of years is bringing fiber right into the house. They just keep expanding and adopting new technology.”

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article reprint — rural ops bridge the digital divide

IOCs Search for Long-term Solutions

Ready for Prime Time

The fact that increasing numbers of IOCs are opting to build FTTH networks and power them with GPON technology underscores the fact that GPON is the near- to mid-term winner in FTTH deployments. Yet not all GPON implementations are created equal. GPON implementations using a native-IP versus legacy-ATM format offer higher efficiency and scalability, and thus ultimately provide greater revenue over the life of the network.

Leading IOCs realize that purpose-built, ATM-based boxes with an overlay of IP-based GPON are not a good long-term solution. Yet most IOCs also are wary of some of the newer IP-based GPON products, which often seem expensive, do not scale well and are not yet fully integrated with deployed equipment.

GPON provides a smooth upgrade path from legacy to nextgeneration services, partly through its support for legacy traffic in its native format — ATM and TDM for example — and native IP traffic. Using GPON Encapsulation Mode (GEM) — a method that maps the service layers (TDM, ATM, IP) onto the PON physical layer — provides the flexibility to carry several protocol formats and allows both legacy ATM access platforms and next-generation IP/Ethernet access platforms to support the latest GPON technology. But the choice of underlying technology (IP vs. ATM) has a significant impact on efficiency, scalability and, ultimately, service delivery. With ATM as the core transport and switching technology, the ability to deliver bandwidth and generate revenue is greatly diminished. ATM was the first transport protocol to reliably carry multi-QoS broadband services over older service technologies, including T1, G.SHDSL and ADSL. Designed specifically to offer granular QoS over relatively low-speed, low-bandwidth links, ATM was challenged by the adoption of high-speed Ethernet technology beginning in the mid-1990s. Today, the industry is moving from ATM to high-speed, high-density technology that uses native IP/Ethernet packets in the physical layer. For example, a typical VoIP flow requires approximately 100 Kbps of bandwidth at the Ethernet layer. When ATM is used to carry this service, the required bandwidth at the ATM layer is approximately 220 Kbps, a more than 200 percent increase in bandwidth needed versus Ethernet. When GPON is deployed on an ATM-based platform, once the system hits a certain percent of chassis capacity, it reaches its maximum serving capacity, and the bandwidth delivered per user begins to decline as new subscribers are turned up. Native IP/Ethernet is the transport technology of choice for newer service tech­nologies including ADSL2+ and VDSL2. Coupled with carrier-class QoS, IP becomes superior to ATM for modern highbandwidth, high-density applications, leveraging the scalability and flexibility of IP and the reliability instilled with QoS mechanisms. In contrast, ATM efficiency varies with the length of the Ethernet packet. As a result, compared with ATM, IP over GPON offers: J

Better bandwidth utilization.

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High transport efficiency, which means service providers can deliver more bandwidth to subscribers on a given infrastructure.

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Greater scalability.

Savvy IOCs look for the maximum return on FTTH/GPON investments by working with vendors that can offer not only IOC-specific technology, but also multiple products they can mix and match to suit their individual needs. These IOCs also want vendors that can help with myriad deployment-related challenges, from design and interoperability support to project management and even ongoing network management. Tellabs understood the challenges confronting the IOCs and developed a comprehensive set of PON access solutions. PON presents a very effective and high-bandwidth way to connect customers and enables a network that can accommodate growing user demands for high-bandwidth applications. Using its extensive experience with PON, Tellabs first went to market with a suite of BPON products, followed closely by GPON solutions. Within the past 18 months, as more and more IOCs have begun to implement their broadbandaccess strategies, Tellabs — which already offers one of the broadest fiber-access product portfolios in the industry — accelerated its GPON efforts.

Thinking Big — and Small Tellabs’ approach leverages its existing customers’ installed base while also providing solutions for greenfield deployments. Many IOCs, for example, began deploying the Tellabs® 1000 Multiservice Access Platform (MSAP) in the mid-1990s. In 2007, Tellabs released a high-bandwidth, cost-effective Gigabit Ethernet uplink interface for the platform’s BPON OLT application. By deploying the GigE card and software upgrade, removing older ATM switches and using less expensive, reliable Ethernet infrastructure, IOCs can protect their investments in the Tellabs® 1000 MSAP while migrating their DSL- and PON-based networks to IP. Tellabs also optimized its IP-based Tellabs® 1150 Multiservice Access Platform (MSAP) by adding a new line module that offers a GPON FTTH solution, in addition to its existing FTTC and FTTN applications. Following up on that enhancement, Tellabs developed the Tellabs® 1134 Multiservice Access Platform (MSAP) specifically for the IOCs; it’s a smaller version of the Tellabs® 1150 MSAP optimized for lower density, rural environments. With four multiservice slots and about one-fourth the size of the Tellabs 1150 MSAP, the Tellabs ®1134 MSAP takes less than 6 inches of rack space, making it ideal for relatively small central offices and small cabinets. Supporting about 500 end users, compared with about 2,000 for the Tellabs 1150 MSAP, the Tellabs 1134 MSAP platform also provides a migration path for existing Tellabs 1000 MSAP customers. Designed to save time and money, the Tellabs 1134 MSAP enables IOCs to upgrade existing Tellabs 1000 MSAP cabinets remotely, so they can deliver faster fiber solutions to specific groups of users, where and when their business plans require.

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article reprint — rural ops bridge the digital divide

A Growing ONT Portfolio, Too Recognizing that there is no single ONT solution that fits every IOC deep-fiber deployment, Tellabs currently offers two options, with more in the pipeline. The Tellabs® 1600-702 Single Family Unit GPON ONT delivers a full Gigabit of bandwidth to the customer, supporting residential voice, high-speed data, IPTV and cable TV services over a single optical fiber. The newer Tellabs® 1600-703 Single Family Unit GPON ONT, with its RF-over-glass (RFoG) design, offers an integrated RF return path, using the 1590 nm wavelength upstream to the headend equipment. While the Tellabs 1600-702 ONTs and Tellabs 1600-703 ONTs are designed for single-family-unit applications, Tellabs currently is optimizing its ONU, typically used in an FTTC deployment, to function also as a GPON-fed ONT that can support “pluggable” services for large MDUs and business locations. An IOC, for example, might receive a request from a customer for some type of special-service circuit. By plugging in a card at the customer’s premises, the IOC can deliver the requested special service via what is, in effect, an IP-based GPON-fed ONT. In addition, these special-service circuits can be deployed alongside other revenue-generating services, such as business Ethernet, DS-1, VDSL2, ADSL2+ and POTS from the same ONT.

Tellabs is a leader in providing deep-fiber solutions in North America, with nearly 2 million PON ONTs shipped to date, and has provided commercially available VDSL2 solutions since 2005. Tellabs fiber access solutions allow service providers to support both broadband DLC architectures (with efficient migration plans to move to GPON) and the latest in all-fiber GPON technology concurrently. Tellabs fiber access solutions support: J

FTTH/FTTP

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Fiber to the Node (FTTN) with ADSL2+ and VDSL2

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Fiber to the Curb (FTTC) with ADSL2+ and VDSL2

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Symmetrical data

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Radio Frequency over Glass (RFoG)

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Digital Loop Carrier (DLC) services such as:

– Digital Data Services (DDS) – Integrated Services Digital Network – Coin/payphone – 2-wire and 4-wire special services – 2-wire and 4-wire transmit only services

All of those technological and operational capabilities require vendors with proven track records in the PON market and financial stability in good and not-so-good economic times. By working closely with vendors such as Tellabs, many IOCs are deploying FTTH/ GPON solutions that fit their unique requirements, scale readily with their network growth, create additional revenue streams, protect their existing investments and future-proof their networks. It is these IOCs and their broadband-access networks that are eliminating the “rural” stigma from rural American communications.

HDTV High-Definition TV IPTV Internet Protocol TV MDU Multiple Dwelling Unit OLT Optical Line Terminal ONU Optical Network Unit PON Passive Optical Network QoS Quality of Service RBOC Regional Bell Operating Company VDSL Very High Rate Digital Subscriber Line VoD Video on Demand

Acronym ADSL Asymmetric Digital Subscriber Line ATM Asynchronous Transfer Mode BPON Broadband Passive Optical Network DSL Digital Subscriber Line FTTC Fiber to the Curb FTTH Fiber to the Home FTTN Fiber to the Node GPON Gigabit Passive Optical Network G.SHDSL Global Symmetric High Bit Rate DSL

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Statements herein may contain projections or other forward-looking statements regarding future events, products, features, technology and resulting commercial or technological benefits and advantages. These statements are for discussion purposes only, are subject to change and are not to be construed as instructions, product specifications, guarantees or warranties. Actual results may differ materially. The following trademarks and service marks are owned by Tellabs Operations, Inc., or its affiliates in the United States and/or other countries: TELLABS®, TELLABS and T symbol®, and T symbol®. Any other company or product names may be trademarks of their respective companies. © 2008 Tellabs. All rights reserved. 74.2009E Rev. B 10/2008