North American Network Operators Group

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Re: cost of doing business

  • From: Thomas Kernen
  • Date: Mon Apr 18 14:52:41 2005

fwiw, 100mb to the home costs about that in japan

We are talking of two different things here, traffic versus access bandwidth.
It will be a while before the average household generates 5 megabit/s traffic.
Even in Korea and Hong Kong, where the average broadband link is in the
5-10 Mbps range, average traffic is about 0.1 Mbps. The main purpose of
high speed links is to get low transaction latency (as in "I want that Web
page on my screen NOW," or "I want that song for transfer to my portable
device NOW"), so utilizations are low.

For those of us that are already running triple play architectures and working on the data analysis related to the bandwidth usage growth (in my case over the last 18 months and adding services one after the other) I see this with a different light:

I fully agree with the transaction latency syndrome, people are compulsive customers that want to buy right now and you (as a service provider) want to see to them purchase the service before they change their mind, just need to look at the ringtones market to see how much people are willing to spend within seconds for a piece of music they will replace in a few days/weeks with their next favorite tune from the charts that marketing is feeding them with.

Where I don't agree is on the bandwidth usage analysis, once you add the IP based TV/VOD* services you will be carrying close to 5Mbps on average on your network in the near future. Either for the one of the TV channels (currently the market is talking about 2 concurrent TV channels down the same pipe to an end user's home in the North American model or 1 for the European) or the VOD. So agreed this is not Internet traffic but you will need to carry it beyond your access termination device (DSLAM/CMTS/ Ethernet switch) since the economics of the IPTV/VOD market and (current?) technical scalability will prevent you from being able to have a the full IPTV/VOD streaming (= unicast and/or multicast in this case) in each POP to keep the traffic as local as possible. So anyhow within your metro area network accessing and aggregating the customers the amount of bandwith required to service all customers will grow quite a bit with IPTV/VOD services.

IMHO (of course)

*Triple play IPTV/VOD = IP packets carrying a video signal using (name your favorite format) either as unicast or multicast stream. This excludes the current hybrid HFC networks that still provide digital TV via an HF stream using (insert your favorite standard here) and the Internet access and voice service over IP. Anyhow they will migrate once DOCSIS 3.0 and the wideband benefits have been marketed to all the cable operators as the "next big thing" they need to have and hence run an IP only service for all the triple play services.