Europe is being left in the dust when it comes to fibre-to-the-home (FTTH) deployments. Japan is installing close to 300,000 lines a month. Europe, meanwhile, has put in 100,000 in the last year.
According to market research firm IDATE, Europe had 650 000 FTTH lines installed by mid-2005, a number that has risen to 750 000 by mid 2006. Japan is installing every seven working days what it takes Europe to do in a year.
Are European incumbents smart to avoid the huge deployment costs of FTTH due to the expected poor returns or will they pay dearly for the delay?
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Deployment of full fibre access network will take 15-20 years and Europe must start now otherwise it will lag behind the rest of the world. We are already seeing the start of the migration from copper to fibre happening in Europe but this is not quick enough. European FTTH activities are very patchy and fragmented primarily driven by emerging Telcos, as the early adopters. The mainstream high-volume market will happen when the large incumbents will engage in FTTH. The timing of turning point will depend on regulation, competitive pressure and increasing user demand for bandwidth.
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