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Broadband

The FTTH killer app: making innovation possible with connectivity and revenue sharing

Monday 11 October 2010 | 16:04 CET | Market Commentary

It’s often asked what’s the killer app needed to justify FTTH. Defenders of HFC infrastructure say they are ready for the next ten yeas, while incumbent operators such as KPN and BT see themselves as ‘smart followers’, waiting to see what catches on in order to quickly copy the trend.

 

After 18 years of internet and 12 years of Google, the need for bandwidth appears to have reached a plateau. Few need more than 100Mbps, and it appears we have reached the end of the internet (r)evolution. There’s still a lot going on though, and broadband appears to be an important enabler for all kinds of innovations.


After years of problems, 3D has finally taken off. Connected TV and the hybrid set-top box are also ready to break through to the mass market, largely thanks to the efforts of Google and Intel. The smartphone is already commonplace (thanks to Apple), and now the space between the smartphone and the laptop, in terms of form factor, is being filled in by a range of devices such as e-readers (like the Kindle) and tablets (such as the iPad), as well as multiple variations of the netbook, notebook, smartbook, booklet and speedbook. The femtocell has yet to take off, but an increasing number of operators are offering the devices. In terms of hardware, two more recent innovations are the umi from Cisco (an OTT box for video calls over the TV) and the LiveView from Sony Ericsson (a type of pager with a screen controlled from a wristband to access updates such as e-mail, social networks and Twitter).


Innovation is also evident on the services side. Cisco’s umi (priced at USD 600) is bundled with a related service (USD 25 per month), and other companies are also active in offering video call services (Skype, Apple FaceTime, Yahoo! Messenger). Machine-to-machine and smart grid applications are also being launched around the world, such as in Zhengjiang, where Nokia Siemens has signed up for a project to create an ’Internet of Things’. In addition, we only have to look at everything Google TV offers to get an idea of what ‘connected TV’ means:
• YouTube and other ‘user-generated content’
• 'Catch-up TV' such as Hulu and the BBC iPlayer
• Video on demand, also as a subscription service
• Applications derived from websites, activated by widgets (think of weather forecasts, Google Earth, stock prices and background for sport matches, as well as video calls and voicemail).
• Websites optimised for TV screeens
• The open internet.


You could say that THE killer app doesn’t exist (or it must be connectivity) and that it’s more about the sum of the parts. Video is usually a part of most recent innovations, and in some cases two-way video (video calls, but also monitoring and surveillance, telemedicine etc.). It’s important to remember though that FTTH, just as other infrastructures, is shared. In the ideal case the fibre runs to the Wi-Fi router, at which point the connection is shared by all the employees, family members, flatmates and not to forget, devices. Issues such as active multitasking (watching TV with the iPad on your lap) and passive multitasking (watching one channel while recording another, backing up data while working on other files) also play a role.


Conclusion: there’s no killer app, only the broadband connection itself (connectivity). Innovation is still progressing quickly, both in hardware and services. It’s up to operators to choose the right strategy, in order to share in the new revenues from the new services and distribution of hardware - otherwise, these new products and services will find their way to the consumer ‘over the top’, or direct to the consumer.
 

Telecompaper’s next conference, Breedband NL 2010, takes place on 13 October. No less than 15 speakers from the telecom world and related disciplines will address these subjects and many more.



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