Broadband

Sky (Easynet) are reportedly trialling a Fibre to the Cabinet (FTTC) system in East London, which according to ZDnet doesn’t involve any customers but is more of a “proof of concept” trial of sub-loop unbundling (SLU).

SLU involves Openreach making available tie pairs at the street cabinet level, allowing 3rd party operators to connect ADSL or VDSL equipment to the short final run of telephone cable to a home or business. This offers potentially much faster speeds as the vast majority of phone lines will be within 1km of their street cabinet or primary connection point (PCP).

The tie pairs will feed into another street cabinet or nearby building housing the equipment, which will also be connected by fibre optic to the operators data network - either via the telephone exchange or directly.

East London is perhaps a special case as it is criss-crossed by fibre from multiple providers, as can be seen from the manholes in the pavement. It also has long phone lines on account of the area being developed from previous docklands and industry. Add to that Sky’s premium broadband service and some potential business clients and one can see why there may be an opportunity to make money with SLU in that location.

Some people regard FTTC as a step towards full fibre to the home (FTTH). However, spending money on kerbside cabinets and electronics doesn’t advance the market far towards FTTH and is effectively dead money in the long run. Running one or two fibres out to a cabinet is relatively trivial compared to a mass FTTH deployment and doesn’t do much apart from make the ADSL system mirror Virgin Media’s HFC network with coaxial aerial cable running into houses from street cabinets.

There is also a competition question around SLU, as the first operator is likely to be the last due to physical space requirements. Might we see a land grab where one operator can provide fast services in an area and the rest be relegated to slow services from a distant exchange?

It is also worth pointing out that Sky are not the first to use SLU, BT have used it in Aberdeen and elsewhere to bypass TPON phone systems and in Northern Ireland to meet their 100% coverage contract. In 2003 Trilogy Telecom (now known as Edge Telecom) was funded by the East of England Development Agency to install FTTC systems in parts of Cambridgeshire to provide advanced services and to cover some broadband notspots.

Tags: BT Openreach, Easynet, Sky, Trilogy Telecom