Liberalisation and regulation in the electronic communications sector:
Theory and empirical evidence
Week 3Technical aspects of Electronic
Communications NetworksBusiness models in network provision
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Technical aspects of Electronic Communications Networks
Core – Backbone Network Fixed (Fiber, PDH/SDH, PoS, GigaBit Ethernet, WDM, DWDM) Wireless
Access Network Fixed wired (Fiber to the Curb/Home, Cable, Coax, Copper -
xDSL) Wireless (802.11, 802.16, LMDS) Mobile (GSM, UMTS, 802.11) Satellite communications (DVB/RCS, VSAT)
Interconnection Interconnection Unbundling
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Backbone - Core Networks
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Backbone - Core Networks (cont'd)
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Access Networks
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Access Networks (cont'd)
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Access NetworkAccess Network
Access NetworkAccess Network
Backbone / Core Network
Electronic Communications Networks
Single Operator
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Electronic Communications Networks
Access Network
Access NetworkAccess Network
Access Network
Backbone / Core Network Backbone / Core Network
Competition
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Interconnection
Physical and logical connection of telecommunications networks.
Users connected to different telecommunications networks communicate directly or indirectly.
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Interconnection - PSTN
OperatorA
OperatorB
A SubscriberB Subscriber
Switch
Trunk Group
Point ofInterconnect(POI)
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Interconnection - NGN
OriginatingCarrier
ISP B
Users
Point ofPresence(POP)
Users
TerminatingCarrier
ISP B
Web Sites Web Sites
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Interconnection - NGN
OriginatingCarrier
ISP B
Users
Users
TerminatingCarrier
ISP B
Web Sites Web Sites
BackboneCarrier
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Business models in network provision
Traditional TELCO offerings (ATM – PDH/SDH)
New TELCO Broadband offerings (Gigabit Ethernet/Packet over SDH, λ-DWDM)
alternate models (dark fiber, condominium arrangements)
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Customer Empowered Networks
School boards and municipalities are building condominium dark fiber networks in partnership with next generation carrier
Individual institutions – the customers – own and control their own strands of fiber
Fiber are configured in point to point private networks; or Connect to local ISP or carrier hotel Private sector maintains the fiber
Low cost LAN architectures and optics are used to light the fiber These new concepts in customer empowered networking are starting
in the same place as the Internet started – the university and research community.
Customers will start with dark fiber but will eventually extend further outwards with customer control and ownership of wavelengths
Extending the Internet model of autonomous peering networks to the telecom world
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Market Drivers
First - low cost Up to 1000% reduction over current telecom prices. 6-12 month payback
Second - LAN invades the WAN – no complex SDH/SONET or ATM in network
Network Restoral & Protection can be done by customer using a variety of techniques such as wireless backup, or relocating servers to a multi-homed site, etc
Third - Enables new applications and services not possible with traditional telecom service providers
Relocation of servers and extending LAN to central site Outsourcing LAN and web servers to a 3rd party with no performance
impact IP telephony in the wide area (skype) HDTV video
Fourth – Allows access to new competitive low cost telecom and IT companies at carrier neutral “meet me” points
Much easier to outsource servers, e-commerce etc to a 3rd party at a carrier neutral collocation facility
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What is condominium fiber?
A number of organizations (schools, hospitals, businesses and universities) get together to fund and build a fiber network
Carrier partners are also invited to be part of condominium project Fiber is installed, owned and maintained by 3rd party professional fiber
contractors – usually the same contractors used by the carriers for their fiber builds
Each institution gets its own set of fibers, at cost, on a 20 year IRU (Indefeasible Right of Use).
One time up front cost, plus annual maintenance and right of way cost approx 5% of the capital cost
Institution lights up their own strands with whatever technology they want – Gigabit Ethernet, ATM, PBX, etc
Ideal solution for point to point links for large fixed institutions Payback, with the current level of prices, is usually less than 18
months!!!
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Municipal Condo Architecture
School
School board orCity Hall
School
Telco Central Office
Central OfficeFor Wireless
Company
Condominium Fiber with separate strands owned by school and by service providers
Carrier Owned Fiber
Cable head end
Average Fiber Penetration to 250-500
homes
ColoFacility 802.11/802.16
Fiber Splice Box
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Benefits to Carriers
Cablecos and telcos: helps them accelerate the deployment of high speed internet services into the community
Small Innovative Service Providers: provides opportunities to offer service to public institutions as well as homes
e-Commerce & Web Hosting Companies: generates new business in outsourcing, web hosting, Hosting etc.
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Montreal, Quebec (consortium)
Municipal authorities, school boards, RISQ (Réseau d’informations scientifiques du Québec – Quebec scientific information network) and IMS (IMS Health Canada) have joined in a consortium to build a municipal owned dark fibre network.
Schools can be connected for an average of $80 per month, per school based on a 20 year amortization of the fibre & eliminate the network servers at each individual school
Each school has essentially unlimited bandwidth (100 Mbps) Schools LAN can be extended back to the central administrative
site. Maintenance, Backups and Software Updates can all be done much more cost effectively from the central administrative building.
Schools are able to explore new high-end applications such as video conference & Voice over IP.
In Montreal, the estimated payback for dark fibre is between 6 months and 2 years.
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The case of FTTH (Fiber to the Home)
Problem: How to provide facilities based competition with FTTH? The incumbent avoids heavy regulation First generation FTTH models assume the old telco model where
competitors can only get open access e.g. PON (Passive Optical Networks)
Second generation FTTH models assume structural separation between service providers and an “aggregator” using Gigabit Ethernet or ATM
CANARIE (the Canadian Research & Education Network) proposes a third generation FTTH model with structural separation using condominium fiber and choice of aggregators or service providers through point to point fiber and RPON (reverse PON)….
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Gigabit Internet to the Home
With municipal condominium fiber builds multiple carriers share in the cost of fiber build out to neighbourhood nodes serving approximately 250-500 homes
It is impractical to have multiple carriers own individual strands from the neighbourhood node to each and every home:
Therefore let the customer have title to individual fiber from the residence to the neighborhood node
The customer connects to the service provider of their choice at the neighborhood node
Customer decides if they wish to connect to an aggregator, convergence provider, or single service Internet provider
Two approaches: RPON which allows easy moves, adds and changes Micro conduit, fiber is blown in upon customer request from
designated service provider
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Gigabit to the Home
ISP BISP C
Splice Box
Up
to 1
5 km
Customer owns fiber strand all the way toNeighborhood Node
XX
864 strands
ISP D
ISP E Colo Facility with RPON
Colo Facility
Business with dual
connections
Municipal Condominium Fiber Trunk
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RPON
Passive OpticalSplitter
TDM return
Aggregator
ISP
NeighborhoodNode
Switch
Customer Controlled or Owned Fiber
Active laser at customer premises
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Regional Networks in EU
SwedenUKIrelandGreece
