The year 2015 is coming to a close and FierceInstaller is taking a look back at the top five key trends that took place in this segment.
While FierceInstaller is still a relatively young publication, service providers in the traditional telco, cable and wireless arenas all are evolving their installation processes.
Installation trends came on a number of fronts -- services, operations, and regulatory.
All of these issues may be different, but they are all focused on two common goals: improving how a service provider delivers services and creating new efficiency.
We saw five main issues that are changing the telecom service installation game:
Turnkey small cell services: While small cell deployments are still arguably in the early stage with some large players like Verizon (NYSE: VZ) and Sprint (NYSE: S) being the most aggressive, wireline operators that offer backhaul services are offering complementary turnkey services, including site acquisition, installation, and network management.
Besides tower companies like American Tower and Crown Castle, the Small Cells as a Service (SCaaS) trend is attracting a number traditional telcos, cable operators and competitors to the table, including Consolidated, Cox, Lumos, Cincinnati Bell, TowerCloud, UPN, and Zayo. Since many of the fiber-to-the-tower (FTTT) contracts are for 10-plus years, having these services on hand could put wholesale providers in a position to reap further revenues from their wireless customers.
On-net fiber expansion: Service providers continued to extend fiber to more buildings to serve more business customers. As it continued to move forward with the fiber-to-the-building (FTTB) program in its Project VIP initiative, AT&T (NYSE: T) reached a total of 950,000-plus business locations by the end of the third quarter, coming closer to its goal of installing fiber into 1 million business locations. The service provider noted that more of the property owners it works with are seeing the installation of fiber as being just as important as having water and electricity.
Cable operators and CLECs are being no less aggressive with their on-net fiber expansions. Take Comcast Business (NASDAQ: CMCSA). Complementing its own ongoing fiber expansion, the MSO has established External Network to Network Interconnection (E-NNI) agreeements with fellow cable providers and other local LECs to serve larger businesses that reside outside of its footprint. Meanwhile, CLECs like Birch are augmenting their own on-net fiber builds by leveraging partners' fiber networks. The service provider now reaches a total of 440,000 buildings. Being able to penetrate and install fiber into more buildings means that these service providers can potentially sell a host of IP and Ethernet services to a larger set of customers.
Micro-trenching, new fiber installation techniques emerge: While the notion of microtrenching is not necessarily new, it is capturing the hearts of a number of service providers that are looking to improve the way they build out FTTH, particularly in areas where they can't get access to aerial utility poles. This process involves cutting a small trench in the ground and then installing a microduct to push fiber to a premise.
CenturyLink (NYSE: CTL) has developed its own form of micro-trenching to accelerate its FTTH roll out through a partnership with the University of Louisiana. The service provider has been using this technology in its Minnesota and Seattle markets. Vendors are also getting into the act. Ericsson (NASDAQ: ERIC) has established a partnership with fiber construction companies Ditch Witch and Vermeer to accelerate underground fiber installation. While these methods are still evolving, the kicker for service providers deploying fiber to homes is that it can potentially be less invasive to residents and save capital build out costs.
Simplifying truck rolls: Being able to reduce the amount of times a service provider has to deploy a technician out to a site has been a key focus since the early days of broadband roll outs. That trend certainly continued into 2015 as telcos and cable operators looked to improve the installation process for video services.
Having completed its DirecTV acquisition, AT&T set about retraining its technician force to be able to install its traditional U-verse IPTV and now satellite-based services. This is all part of a process AT&T has taken to streamline its video installation processes through what is known inside the company as Project Halo. Likewise, CenturyLink is also keen to reduce truck rolls for video deployments. While it has continued to expand its IPTV footprint, the service provider sees its pending over the top video trial, which enables users to get video over their broadband connection next year, could also reduce truck rolls while putting service into the hands of more consumers. Not to be outdone, cable operators like Comcast and Time Warner Cable (NYSE: TWC) also reported during the third quarter that they reduced truck roll service calls in the third quarter.
Pole attachments: Service providers may be installing fiber underground, but there remains great efficiencies and cost savings in using existing utility poles. However, the costs of attaching to poles has been a thorny battle between service providers and pole owners. After issuing its attachment order in 2011, a number of groups asked the FCC for clarifications on various issues. In November, the FCC finally made a big step in simplifying the pole attachment process when it issued an order creating parity on what telcos and cable operators pay for pole access. This will create some certainty for service providers that want to expand their fiber networks.
These issues are just a snapshot of what is taking place in the installer community. As we head into 2016, please give us feedback on these topics and others you are seeing.--Sean
P.S. In observance of the Christmas and New Year's holidays, FierceInstaller won't publish its next issue until Jan. 6. Have a great holiday season.