Integrated FTTx PON HGs just the start

Julie Kunstler/Ovum
14 Nov 2011
00:00

Integrated FTTx PON (passive optical network) home gateways (HGs) are not a new concept. They have been discussed for years but very few integrated PON HG devices have been deployed in customer premises. This is changing rapidly with tenders and initial deployments in China and Eastern and Western Europe.

The drivers for integrated PON HGs include declining costs for both PON ONTs and HGs, which thereby lower the costs of integrated solutions; the movement to all IP-based triple-play services, such as VoIP and IPTV; and service providers’ desire for simplified management and maintenance of multiple boxes at the customer’s premises. But the major drivers are advanced applications, such as home security and home automation.

Service providers have diverse requirements depending on local regulations, their respective views of applications for the broadband pipe, and existing CPE (customer premises equipment). We nonetheless forecast strong growth and future integrated solutions with extensive software platforms to support advanced services.

One could argue that integrated PON HGs should have arrived sooner given the expertise garnered from the DSL and cable markets. But there have been hurdles to clear, such as government regulation, which prohibited some service providers from offering triple-play services. This type of regulation led to the installation of simple PON CPE devices to support broadband data.

Sometimes internal service provider organizational politics were an issue, with one division focused on PON equipment while another was focused on the HG. In addition, the costs of initial PON CPE were high, well over $100. When combined with an HG, the cost was prohibitive and the risks were high in early PON deployments where the service provider was experimenting with various features.

These factors are changing. Some governments have eased up on their regulations, permitting service providers to offer triple-play services. PON MAC chip vendors are offering integrated PON HG SoCs (system on chips). The prices of PON CPE devices have dropped by more than 50% and are continuing to decline due to integrated SoCs, declining optics costs, and volume manufacturing. Finally, service providers are gaining expertise in PON.

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