Who wants an update?

I took a road trip a few hours west of Omaha today to go attend a conference for Nebraska telephone companies, the chief focus was on what phone companies need to do in order to stay in business over the coming years.

Aside from a few changes here and there to allow for internet service and other random crap, the technology behind the telephone hasn’t really changed since about 1980. This is a problem, because the rest of the telecommunications industry has. Internet service is getting faster and faster, high-definition TV is going to be a way of life in less than 5 years, etc etc.

Enter FTTH – fiber to the home.

This shit is all over the place in Japan. If you ever talk to someone over there and they tell you they have a 100mbps internet connection, guess what? They’re not lying. Where we’re at right now we can take fiber optic cabling and put any imaginable amount of bandwidth on it and still not max it out. Right now where I work we have a ring of gigabit ethernet connecting all our communities back to our NOC that is all fiber based – if a gigabit turns out not to be enough eventually, we’ll just switch all the converters out with equipment capable of passing traffic faster than that. Access to the home is going to get nuts, too – gigabit passive optical networks (GPONs) are under development that will allow for 2.5gbps down and 1.25gbps up, or something as simple as a symmetric 622mbps connection.

So what are you going to do with that kind of bandwidth? Well, voice over IP has already taken off. That’s just one possibility, but the amount of bandwidth required for VOIP is peanuts even today. How about your TV service? A high definition stream requires about 16mbps of bandwidth, which automatically puts it out of the range of people on DSL connections, and it will not be accessible by cable modem customers until providers start coughing up more bandwidth than they already do. Consider: if the average household has 4-5 TVs, and HDTV is going to become standard on television sets manufactured after 2009, you’re looking at 70mbps going out the window if every television in your house is tuned to a different channel. The cable modem I just bought last week can’t even handle half of that.

The reason this is going to effect telephone companies is simple: you can do anything on an IP network that a local telco can do, plus a hell of a lot more. We supply cable TV and phone/DSL server the old fashioned way right now. That’s going to change in a year or two, but in the meantime if somebody comes into our town and lays fiber everywhere right under our nose, they just killed us. They have a future-ready telecommunications network with endless possibilities while we’re still stuck in the stone age.

So the moral of the story is… watch out, because in the next few years there’s going to be fiber everywhere, and it’s going to turn telecom upside down.

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