1. www.ist-muse.org The role of wireline access technologies to bridge the digital divide BB for All Cluster workshop “How to bridge the digital divide ?” Brussels, 22.03.2006 Peter.Vetter@alcatel.be

2. Digital Divide — 2 www.ist-muse.org Introduction Three dimensions in the problem space of digital divide: 1: Rural areas Survey technologies for rural areas Selecting the most cost effective solution Recommendations 2: New member states General survey Example cases Poland/Hungary 3: Social divide Actions to facilitate BB access

3. Digital Divide — 3 www.ist-muse.org 1. BB access for rural areas Introduction > Approaches for (sub)urban areas are not suited for rural areas High speed internet: 1 Mbps (ADSL < 5 km) Multi media streaming: 3 Mbps (ADSL < 3 km) HDTV, Video distribution, multiple users/home: 10-100 Mbps > Different solutions possible Premises 1 user Access node 5-75 users Aggregation node 1000 - 10000 users 0-5 km 10-30 km with terrestrial solutions No limits with the satellite ADSL Wireless Satellite Fibre Leased lines E1 Wireless Satellite Fibre AccessBackhauling

4. Digital Divide — 4 www.ist-muse.org DSL in rural areas DSLAM Remote DSLAM 10 Mb/s 5.5 Mb/s 3.5 Mb/s 1 Mb/s 7.5 Mb/s 10 Mb/s 5.5 Mb/s 3.5 Mb/s 1 Mb/s 7.5 Mb/s Remote DSLAM Coverage Increasing loop length Remote Unit Lowest cost Investments scale linear (large choice of remote DSLAM with different modularity) Suited for clustered rural users  Limited reach  Combination with backhauling feeder needed

5. Digital Divide — 5 www.ist-muse.org DSL bonding as backhauling n x 2 Mbps (n=1,2,4,8) SHDSL Active repeater per 2.5 km ADSL Low cable infrastructure cost Low cost equipment  Limited reach for backhauling  Limited bandwidth  Active repeater points needed (operational cost)

6. Digital Divide — 6 www.ist-muse.org Wireless solutions for rural access WiFi WLAN (2.5 GHz) 2 Mbps / 3-5 km WiMAX (2-11 GHz) 1 Mbps / 15 km No wireline infrastructure required Fast roll-out possible Solutions available for access and backhauling  Limited BW/reach for non line of sight radio technology (<11 GHz)  High BW solutions (10-66 GHz) are line of sight and high cost WiMAX (10-66 GHz) <70 Mbps / 10 km

7. Digital Divide — 7 www.ist-muse.org Satellite Hub 2-way satellite access Bi-directional 64kbps/2Mbps Standard interface : DVB-RCS Unlimited reach, quick and easy deployment Direct access and backhauling Robust in times of crisis High bandwidth Satellite downstream + terrestrial upstream possible  Large initial investment (but shared between numerous actors)  Latency (e.g. gaming)

8. Digital Divide — 8 www.ist-muse.org Optical fibre Long reach, highest BW Future safe Robust, low maintenance cost Today mainly for backhauling  High civil works cost BPON (622/155 Mbit/s) G/EPON (1.25/1.25 Gbit/s) Ethernet FTTH 1:32

9. Digital Divide — 9 www.ist-muse.org End to End combinations Fiber Operator/ISP 100-1000 Km Internet AggregationCPE Access 2way sat < 4 km WiMAX< 15 km EthWiFi 2,5 Mbps hald-duplex < 15 km Microwave < 30 km 1 Mbps half-duplex 1 Mbps half-duplex EthWiMAX Sat Hub 8 Mbps down 2 Mbps up < 5/10 km/village < 5 km < 50 km 1 Mbps/user ATM/EthDSL Fibre

10. Digital Divide — 10 www.ist-muse.org High Speed Internet Access (1-2 Mbit/s) Selecting the most cost-effective solutions > Capex estimation (Capital Expenditure): CPE cost Network costs: short term amortisation 3 to 5 years (3 y. in study) – Active network equipment (access nodes, aggregation, …) Network costs: long term amortisation 15 to 20 years (20 y. in study) – Civil works (Laying fibre, Building radio tower) > Opex estimation (Operational Expenditure): Equipment maintenance, renting (space/energy), … are included. Network operations costs are not included. > Comparison of monthly cost per user (reference Urban DSL=1)

11. Digital Divide — 11 www.ist-muse.org Cost comparison solutions for rural areas DSL + Fibre (limited civil work) DSL + Fibre (full civil work) WiFi + WIP WiFi + Satellite WIMAX E2E WIMAX + microwave WIMAX + satellite Satellite E2E (Access + backhauling technology)(Relative cost Urban DSL =1)

12. Digital Divide — 12 www.ist-muse.org Survey end-to-end cost 1 10 30 50 1530501001000 Wifi or DSL + Liaisons Louées Wifi or DSL + Liaisons Louées 70 80€ 30€ WIP or WiFi + Satellite WIP or WiFi + Satellite 70€ Herzien DSL + Microwave ELLITE 2way Satellite Average Micro village Large Village 1530 Urban DSL Urban Ref. Price x1 x2 501001000 Wi-Fi or DSL + Fibre + x6 x2.5 WiMAX or Wi-Fi + Satellite x4 Backhauling distance (km) # connected users First technology listed is the access technology, while the second one is the backhauling technology 15 E2E WiMAX x4 Wi-Fi or DSL + WiMAX x3 x2,5... DSL +Fiber or x2,5 x2... x2,5…x4

13. Digital Divide — 13 www.ist-muse.org Main conclusions cost comparison Compared to DSL in urban areas, broadband access is 2 to 6 times more expensive in under-served areas Scattered users and small villages (about 10/20 users) Medium villages (30-50 users): Large villages (70 users): Ü Satellite is best solution Ü Wireless (WiFi/WIMAX) or Wired (DSL + Fibre/radio) Ü Wired (DSL + Fibre/microwave)

14. Digital Divide — 14 www.ist-muse.org How about higher bandwidth (10 Mbit/s) with wireline solutions in rural areas ? > High bandwidth wireline solutions (>10 Mbit/s) do not result in a positive business case for rural areas (FTTCab, FTTH) > Cash flow is most sensitive to infrastructure cost: optimisation needed

15. Digital Divide — 15 www.ist-muse.org How to improve the economics in rural areas ? > Subsidies from local authorities to bridge the added cost prevent the digital divide of under-served areas > Exploration of new business models with utility companies sharing infrastructure and civil works > New revenues through open service enabling platform allows access provider to provide added value and to tap on the revenue stream incentive for access provider to invest in better infrastructure

16. Digital Divide — 16 www.ist-muse.org New member states (1) > Take-up is low compared to EU average, but caching up Mainly in large and small cities, but also in villages

17. Digital Divide — 17 www.ist-muse.org New member states (2) > Fees similar to “old” member states, but relatively high to salaries

18. Digital Divide — 18 www.ist-muse.org New member states (3) > Mainly DSL and Cable, also FWA Today, about 80% of population in new member states can be technically be reached by ADSL (0.5 Mbit/s)

19. Digital Divide — 19 www.ist-muse.org New member states (2) > Poland Case: 0.5 Mbit/s ADSL: 31 Euro/month … 6 Mbit/s ADSL: 64 Euro/month Competitive offer on Cable by UPC 4.2 % penetration Aim for 99% ADSL coverage Start roll-out FTTC/B PON: watch the trends world wide > Hungary Case: 1 Mbit/s ADSL 40 Euro/month (DSL, Matav), 2.5 Mbit/s: 40 Euro/month (Cable, UPC) Clustered remote subscribers: – TDM or ATM fibre feeder + DSL, some HFC Dispersed remote subscribers: weak HSI offer, improving thanks to government pressure (ADSL or Downstream Satellite + ISDN) Future trend: – migrate to Ethernet aggregation, – FTTC (feeder not decided PON or PTP)

20. Digital Divide — 20 www.ist-muse.org 3. Social divide > Some people live in areas with broadband access but do not make use of it “IT – illiterates” (e.g. seniors, people without technical training) Lower social classes > Technical solutions to facilitate BB access Autoconfiguration architecture defined in MUSE – Auto configuration server, remote provisioning - maintenance BB Access for non-PC users (about 50% of the population) – E.g. via TV > Other actions One PC per home (should be low cost, simple to use PC) – distribution via schools for e-learning, – social care organisations for e-health Access via schools (including parents), Cyber cafés for Senior Citizens E-Health, e-government, e-anything as promotors for BB Access Trainings to “IT-illiterates” Public helpdesks Political effort Responsibility operators, system vendors, consumer industry