In a recent whitepaper entitled “Network Modernization: A Vital Step Toward Universal High-Speed Broadband,” USTelecom advocates for a “modern regulatory environment that advances rather than undercuts tech modernization.” Essentially, they worry that outdated regulations are placing too much emphasis on maintaining old copper networks rather than speeding universal access to reliable, high-speed internet.
While they don’t advocate for one kind of next-generation broadband network architecture over another, it does bring up the familiar debate happening in the market right now: Fiber to the Home (FTTH) versus Hybrid Fiber-Coaxial (HFC). While HFC has been the dominant choice for a while, FTTH is currently on the upswing and for good reason. Here’s how that will impact network operators now and into the future.
HFC Still Dominates but Will Lose Share Relative to Fiber in the Coming Years
When it comes to network modernization in the U.S., Fiber to the Home (FTTH) and Hybrid Fiber-Coaxial (HFC) networks have been locked in a seemingly never-ending popularity contest. On one hand, fiber now passes just over 51% of US households, but, for a variety of reasons, cable is still currently in the top spot for delivering broadband. However, the trend is in fiber’s favor. According to Omdia, HFC’s share of the market will diminish in the coming years while fiber’s rises. In fact, RVA forecasts that telecom companies, cable MSOs, private competitive providers, municipalities and rural electric cooperatives will invest $150 billion on FTTH in the U.S. over the next 5 years. That’s good news for everyone on team FTTH.
Why FTTH is Fast Becoming the Optimal Solution for Universal Broadband
Part of the rise in fiber’s popularity has to do with ongoing work to bridge the digital divide. As we noted in a previous blog, demand for fiber-based connectivity in rural areas is rising. For example, the Prysmian Group forecasts that 82 million U.S. households will receive FTTH services by 2027, almost double the number already experiencing such service at the end of 2023. And, according to Light Reading, 87% of network operators are planning to use fiber networks to bridge the digital gap in their areas of service. The reason behind growing adoption of FTTH lies in PON technology. Through use of passive optical components and point-to-multipoint topology, PON networks allow multiple subscribers to share the same fiber infrastructure, reducing deployment and maintenance costs. In this way, PON offers a sustainable, high bandwidth and more cost-effective (by not using active networking equipment) alternative to other broadband delivery mechanisms.
Additionally, residential and business subscribers are becoming increasingly savvy in today’s competitive markets. Based on RVA market research, 63% of internet users surveyed now say they would prefer fiber if they had a choice, versus 24% coax and 13% in favor of wireless, DSL or satellite. With continued advancements in PON technology (i.e., from GPON’s asymmetrical data rates to XGS-PON’s symmetrical 10 Gb/s rates), FTTH has a strong future as network operators bridge the digital divide in regions where high-speed connectivity is essential now and down the line. After all, bridging the digital divide means giving underserved, rural subscribers the same opportunities as their urban counterparts to access advanced applications from telemedicine to cloud services.
HFC is Still Staying Competitive
As LightReading notes, the cable industry is facing challenges with growing its broadband subscribers considering the competition coming from fiber. That said, Alan Breznick, Heavy Reading analyst, notes “If it feels like an uphill battle for cable, maybe that’s because it is. But that doesn’t mean it has to be a losing battle. That’s because the cable industry still has plenty of tricks left up its sleeve.” From extended DOCSIS 3.1 (also referred to as DOCSIS 3.1+) to DOCSIS 4.0, the cable industry is working to keep pace with the PON FTTH sector. Both DOCSIS 3.1 and 4.0 provide 10 Gbps of downstream capacity, ten times more than DOCSIS 3.0. On the upstream side of the equation, DOCSIS 3.1 offers 1-2 Gbps or capacity while DCOSIS 4.0 boosts this up to 6 Gbps. That’s exponentially greater than DOCSIS 3.0’s upstream capacity of 200 Mbps.
Whereas DOCSIS 3.0 has mainly been used for lower-bandwidth applications like video conferencing or online training, DOCSIS 4.0 is ideal for situations requiring high upstream speeds like healthcare, video conferencing, IoT, online learning, virtual reality and much more. In many ways, even though FTTH adoption continues to accelerate, HFC networks are still a vital part of delivering universal, high-speed broadband across the U.S.
The Importance of Optical Transceivers in Fiber and HFC Networks
Of course, optical transceivers are the critical pillars upon which any kind of network architecture relies on. For FTTH and XGS-PON networks, for example, optical transceivers in use must support 10 Gbps data rates for both upstream and downstream traffic. Common form factors include SFP, SFP-DD, SFP+ and XFP. Thanks to the relatively simple upgrade pathway from GPON to XGS-PON and the use of XGS/GPON Combo SFP+ and SFP-DD transceivers, it’s possible to offer both XGS-PON and GPON services over the same network. That just adds to the scalability inherent in fiber-based networks.
When it comes to HFC networks and Extended Spectrum DOCSIS and DOCSIS 4.0, however, optical transceivers become incredibly important. Here’s why. Extended Spectrum 1.8 GHz DOCSIS 4.0, leveraging remote PHY 2×2 nodes, will need 25 Gbps optical linkns to support bandwidth demands from end-users. With talk of 3 GHz DOCSIS (as of yet unnamed, but potentially DOCSIS 4.1 or 5) already underway, optical transceivers capable of supporting 25 Gbps in HFC networks are fast becoming critical. The problem, however, lies in the link distance and performance trade-off. To put it more clearly, chromatic dispersion limits conventional 25G optics to distances of between 10-15km unless specialized equipment is used. But that makes HFC networks even less cost-effective relative to fiber (i.e., PON, FTTH). After all, at bandwidths of 10G, chromatic dispersion only limits network links to approximately 80km.
That’s where our award-winning Genesee™ Dispersion Compensation ASIC-enabled (application-specified integrated circuit) technology comes in. Leveraging this, we’ve innovated a cutting-edge, 25G tunable module that enables users to reach distances of 40km and beyond without needing specialized equipment. With groundbreaking technology like this, HFC network operators can inject a new boost of vitality into their architectures as they compete with PON technology and FTTH architectures.
Embracing Our Increasingly Digital World
As the world becomes increasingly digital, the demand for high-speed broadband and universal access from urban to rural communities continues to grow. Whether addressing this through FTTH deployments or HFC upgrades, our team of optical engineers has the solutions and innovations you need to turn your goals into reality. From rigorous testing in our labs to our systems integration expertise and ongoing customer support, we have you covered. Network modernization is an ever-evolving, iterative process that underscores the need for continuous innovation and investment in optical technologies. Finding a true partner to help you navigate that journey is an optimal first step. Contact us with your questions!