Fibre rollout in population densities of 6,000? Try 50

A new German report on fibre rollout in Europe and Australia focuses on population densities of a minimum 6,000 people per square kilometre, highlighting the challenges Canada faces as it rolls out broadband in suburban and urban areas with densities as low as 50 people per square kilometre. Produced by Dr. Karl-Heinz Neumann, director and general manager of the WIK Scientific Institute for Infrastructure and Communication Services in Germany, the paper investigates the economic viability of fibre-based network rollouts in Europe and Australia (where the federal government recently released plans to invest $43 billion AU in fibre-optic infrastructure). Titled “Structural models for NBN deployment,” the paper compares network build scenarios, considering questions such as whether the network builder is the first to market, the network’s reach (fibre-to-the-home versus fibre-to-the-node), and the kind of technology behind the service. But of note for Canadians may be the population densities that the paper focuses on. WIK divides markets according to the number of people per square kilometre. Urban areas are defined as locations with more than 6,000 people per square kilometre. Suburban is defined as areas with more than 1,000 people per square kilometre, and rural is those with fewer than 100. Network costs, the report points out, are directly related to population densities. “The costs of an access network infrastructure depend on the population density of the area served,” says the report, which focuses on urban or suburban populations. “The denser populated, the more profitable the NGA business in that area.” What is a country like Canada to make of a broadband report defining urban areas as those with more than 6,000 people per square kilometre? Depending on the sector being measured, few Canadian cities have areas in that ballpark. According to The Neptis Foundation, an organization that studies urban regions, the average population density of Toronto’s metropolitan area is only 2,700 people per square kilometre. For Vancouver the average is just 2,350. In Montreal, it’s slightly higher, at 2,880. The Department of Natural Resources’ Atlas of Canada defines the Canada's population density categories ranging from less than “0.1” to “greater than 150.” The department provides a population-density map of Canada that shows only four areas (Montreal, Ottawa, Toronto and Vancouver) as having more than 150 people per square kilometre. Some areas (Calgary and Edmonton) are in the 50-to-150 range. More areas (Moncton, Quebec City, the Kingston-Montreal corridor of Ontario, and Winnipeg) are in the 20 to 49.9 category. Bill St. Arnaud, an independent network consultant, said there may be a lesson in the WIK paper for network developers in Canadian urban centres. “Canada and Australia are the two most urbanized countries in the world,” he said. “For 90 per cent of our populations, we have higher population densities than the Netherlands, Germany and the U.S. But then we have those huge gaps in between.” Fibre-to-the-home should represent a significant portion of Canada’s urban network infrastructure, he said. “Fibre to the home to 90 per cent of the population should be easier than it is in the U.S., Holland or Sweden,” St. Arnaud said. But outside of urban areas, wireless and satellite may have to be the answer, he added. “There’s an argument for public subsidy or some other solutions to address that 10 per cent who live in very rural and remote areas, and where I think wireless most likely will be the only practical solution.” John Maduri, CEO of wireless Internet provider Barrett Xplore Inc., said his company has conducted an in-depth mapping exercise to see which flavour of wireless works best for which parts of the country. He said the viability of wireless can depend on several factors, such as population density and limitations due to geography, terrain and topography (such as trees). “Wireless can be impacted by all those factors,” Maduri said. “We’ve mapped where network backbones are available, what they call in the states the middle mile, all determining if we’re going to go to market in rural areas or low population density areas with wireless ... or deploy with satellite technology.” Canada isn’t unique, he added. “Australia is spending $43 billion to get fibre as far as they can, and there’s still a significant part of the country where satellite and wireless technology will be the solution of choice.” Barrett recently announced plans to launch a new satellite this year, the ViaSat-1, to make more satellite capacity available for rural broadband on the Ka band. But Canadian Internet providers are also rolling out fibre-optic services. Bell Aliant announced this month that its FibreOP fibre-to-the-home and Internet and IPTV service has been expanded to the Moncton area (which registers in the 20-to-49.9 people per square kilometre category). The company has plans to expand it to other Atlantic Canada cities such as Miramichi and Bathurst, N.B., and Sydney, N.S. MTS has also announced plans to invest $125 million over the next five years to accelerate its fibre-to-the-home network across Manitoba, and SaskTel has embarked on a 10-year fibre-to-the-home program to deliver the service to 10 communities in Saskatchewan. Telus Corp. and Bell Canada are also expanding their fibre infrastructure. Mark Goldberg, head of telecom consultancy Mark H. Goldberg & Associates Inc., said that the fact that the WIK paper uses such high population densities indicates that it’s not always possible to compare Canada’s Internet infrastructure to that of other countries. “Fibre should be deployed by some carriers, absolutely,” Goldberg said. “But to suggest that fibre is the only solution is setting unrealistic expectations.” The WIK paper also discusses the idea of building multiple fibre connections into customers’ premises. This so-called “multi-fibre” approach envisions a network builder designing a fibre-to-the-home network with four-to-six fibre connections. Service providers could lease access to the fibre to deliver services. The network would be built by a company specializing in network development—not necessarily an incumbent telco or cableco. “You could have one pair of fibres for a cable company, another pair of fibres for an Internet company, and another pair for the telephone company,” St. Arnaud said. “It gives the customer a lot more flexibility, and a lot more competition.” He added that the “multi-fibre” approach has been done in Amsterdam and the United States. “It’s a real estate play. They realized that the value is actually in these fibre strands, not in providing services,” St. Arnaud said. Les Maerov, president of Urban Communications Inc., a Vancouver-based network developer, said multi-fibre architecture may not work in Canada’s incumbent-heavy communications industry. “The problem is the identity of the gatekeeper,” Maerov said. “The carriers won’t trust anybody, unless they can control access to their fibre. They want to maintain it when they want. They don’t want to have to ask anyone’s permission. They don’t want to pay anybody for it.” news@thewirereport.ca

Fibre rollout in population densities of 6,000? Try 50

News | August 30, 2010

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