Huawei shows there's growth in DSL yet

Kamalini Ganguly/Ovum
30 Sep 2010

Huawei’s recently announced demonstration in Hong Kong of prototype DSL equipment that can support 700Mbps transmission on four twisted pairs over 400m offers yet another indication that DSL’s life is far from over. Indeed, other vendors have previously unveiled their own approaches to boosting DSL bandwidth capacity. The future may be with fiber, but Ovum’s research indicates that growth remains for DSL.

DSL still a battleground for major broadband access vendors

In Ovum’s 2Q10 broadband access market share spreadsheet, we estimate quarterly global DSL revenues to be $848 million (not including DSL CPE), a little higher than FTTB/FTTH revenues of $796 million, even when FTTB/FTTH CPE – ONUs and ONTs – are included. Indeed, over the past two years, even as FTTB/FTTH subscribers and associated equipment revenues have grown steadily worldwide, DSL revenues have been slightly higher each quarter.

Ovum believes the DSL equipment market will not wither away anytime soon. While it is certainly true that DSL subscriber growth is slowing in many countries and that DSL subscribers, in places like Japan and Korea, are being replaced by FTTH/FTTB subscribers, DSL equipment will still be used in many hybrid fiber-copper architectures.

In fact, Ovum forecasts that even in 2015, 63 million DSL ports will be shipped globally (down from 82 million ports in 2009). However, the great majority of these, if not all, will be in conjunction with growth in FTTx subscribers, not DSL.

In announcements, vendors have highlighted 400–500m as the distance where they demonstrated their breakthroughs. The assumption here is that the length of the copper loop (supporting VDSL2 or ADSL2+ to the customer) will be approximately that long, the rest being fiber to the central office as part of an FTTN, FTTC, or FTTB architecture.

The reason not to deploy FTTH all the way to the customer residence will be primarily economic, but technology and regulatory constraints will also play a part. As a result, we believe DSL network equipment will still be a $2 billion market in 2015, hence the scramble by major vendors to continue innovation in DSL.

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