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The last mile access network continues to be one of the most important topics within telecoms. Even with local loop unbundling the expense of constructing access networks to customers is a key telco consideration and represents a significant market entry barrier.

Access networks, by and large, have struggled to meet user expectations and deliver traffic to the end user. Most networks still cannot deliver the mega-broadband speeds needed to carry triple play services. Operators that have already achieved this are hailed as heros, but there are always qualifiers. For example, services can only be delivered to concentrated groups of subscribers in certain catchment areas.

In the past an access network consisted of copper cables installed in a branching network to the customer. Now things are different with a mixture of copper, fibre and wireless connectivity offering a wide range of speeds. Some customers are lucky. They either next door to a telephone exchange (CO) or are served by a cable operator. These users have a choice of high speeds via DSL copper based technologies or over broadband cable networks. Other customers that live a long way from a serving exchange or have no cable access are stuffed. Forget about the advertised 8-16 Mbit/s speeds. In the real world they must put up with slow broadband speeds (e.g., 1Mbit/s), even using ADSL2+. An unbundled local loop option still does not make things better as other operators still use the incumbent cable network.

Some operators are pushing fibre into the network in an effort to offer higher speeds to customers. Access network upgrades usually take the form of Fibre-To-The-Curb (FTTC) but these upgrades take time and are expensive. Is wireless the answer then? Well, 3G mobile networks are offering increasing data access speeds but are likely to remain expensive when compared to copper. WiMAX is on the horizon with the promise of higher access speeds, but here the WiMAX business model is still largely unproven.

It is worth remembering though that operators want to deliver higher speeds to provide value-added services such as IPTV, as existing revenue growth in voice is flat or even declining. For this to succeed network build has to keep in step with service offering. In this sense cable operators are already there and other operators must play catch-up.

Operators need to be bold. Hats off to Deutsche Telekom with its continuing implementation of FTTC. Let's hope that this shows the way. Ultimately, copper networks will evolve into Fibre-To-The-Home (FTTH). It is one of those things that you just know will happen, even though it may take many years. In the meantime, how operators provide higher bandwidth to customers will be one of the most important topics over the next 10 years.

Market Cohesion discusses many of these and other issues in detail in its report Competitive Access Markets.  This latest report from Market Cohesion analyses the current and future broadband markets. Based on interviews with leading industrial decision makers the report provides a detailed analysis of the competitive positioning of fixed line, cable and mobile operators. You can download the brochure here. 

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