VDSL equipment revenue rose 15% in Q2, says Dell'Oro
Fiber-based broadband is the ultimate last mile access dream, but there's arguably still strong momentum for hybrid copper/fiber-based VDSL, according to a new Dell'Oro report.
In Q2 2012, the analyst firm reported that VDSL equipment revenue overall jumped 15 percent year-over-year, a factor they attribute to strong both VDSL infrastructure (i.e., DSLAMs and BLCs) and CPE shipments.
Leading the VDSL network infrastructure race were ADTRAN (Nasdaq: ADTN), Alcatel-Lucent (NYSE: ALU) and Huawei, while Huawei, Pace (2Wire) (LSE: PIC) and ZyXEL reported the strongest VDSL CPE shipments during the quarter.
Interestingly, the dynamics in the VDSL infrastructure segment have been going through a migration of their own as ADTRAN and then Calix (NYSE: CALX) purchased Nokia Siemens Networks' and Ericsson's access divisions.
Steve Nozik, principal analyst of access research at Dell'Oro Group, said that the service provider's move to adopt either VDSL and/or PON is twofold: meeting growing consumer and business bandwidth demands, and leveraging existing copper infrastructure to deliver higher speeds in existing Brownfield areas.
"Most service providers are looking to VDSL and/or PON to increase the capabilities of their access networks to keep up with increasing internet traffic and to enable new high-bandwidth intensive services including IPTV," Nozik said.
He added that emerging innovations such as "vectoring and bonding products which have the promise of dramatically increasing bandwidth without the high cost of laying fiber" will drive further VDSL growth.
Both domestic and European service providers, including AT&T (NYSE: T), CenturyLink (NYSE: CTL), BT (NYSE: BT) and Telekom Austria (NYSE: TKA), have become dominant users of VDSL2 to extend the life of their respective copper networks to deliver higher speed broadband and TV services.
In the United States, AT&T has leveraged VDSL2 as its platform for U-verse video and data—two products that have become strong revenue generators in the telco's consumer wireline segment. CenturyLink has taken a more cautious approach by deploying VDSL in some select markets, including the existing Qwest Fiber to the Node (FTTN) territories, with plans to eventually move to VDSL2 with bonding to possibly deliver 100 Mbps.
In Europe, Telekom Austria, which has been updating its last mile copper network with two approaches--including both a FTTC (Fiber-to-the-curb) and FTTEx (Fiber-to-the-Exchange, also known as VDSL@CO)--conducted a trial of Alcatel-Lucent's vectoring technology. The service provider said in January that vectoring could enable them to deliver up to 100 Mbps and 50 Mbps speeds at distances of up to 300 meters and 800 meters respectively over their existing copper network.
- see the release
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