Both AT&T and Verizon have noticed something that could have a major impact on communications network design moving forward – and which they hope to use to their advantage.
As AT&T Group President and Chief Strategy Officer John Stankey explained at a financial conference last week, traffic from end users to the Internet is growing at a faster rate than traffic from the Internet to the user. And at sporting events and concerts, upstream traffic sometimes exceeds downstream traffic as spectators share video of the event on social media, Stankey said.
Verizon made a similar observation in a recent press release, citing market research from IDC which found that 20 percent of U.S. broadband households are Power Users who spend a lot of time online and who upload nearly as much content as they download.
The press release was the one that Verizon issued to announce that 95 percent of Verizon FiOS broadband customers would be upgraded to receive upload speeds that matched their download speeds. Meanwhile, the GigaPower service that AT&T has begun to roll out in select markets also offers symmetrical gigabit speeds.
Both FiOS and GigaPower are based on fiber-to-the-premises architecture – and as cablecos gear up to deploy higher-speed broadband based on DOCSIS 3.1, the telcos are hoping symmetrical service will give them an edge. DOCSIS 3.1 is underpinned by hybrid-fiber-coax infrastructure, which cannot easily support symmetrical service – although according to Cablelabs, it can support service as fast as 10 Gbps downstream and 1 Gbps upstream.
A competitive threat?
How big a threat are telco symmetrical high-speed broadband services to the cable companies?
While the shift toward symmetry may give companies like AT&T and Verizon a competitive edge in FTTP markets, both companies have many markets where their only broadband offering is lower-speed DSL and where they don’t believe they can earn enough revenues to justify the investment in FTTP – even though the companies continue to lose customers to faster cable services.
Verizon has deployed FTTP quite extensively, but AT&T only has begun to offer FTTP service in a few GigaPower markets, with several more in the planning phase. And Stankey’s comments last week suggested that AT&T doesn’t envision symmetrical service for U-verse markets, where the company offers high-speed broadband based on fiber-fed DSL technology. Right after discussing U-verse take rates, Stankey said there are markets where that technology “will run its course—that’s what GigaPower is all about.” And right after that is when he talked about the importance of symmetrical service.
He also made the comment that GigaPower’s symmetrical service would be very attractive in comparison with DOCSIS but didn’t talk about U-verse in that context.
So while symmetrical service may give AT&T an edge, that edge won’t come without substantially more investment in FTTP.
There is also a possibility that we may see cable companies making some level of investment in FTTP. Several of the cable companies that plan to offer gigabit service -- including Cox, Bright House, and Grande – said they will rely, at least in part, on FTTP infrastructure. But Suddenlink, which recently announced plans to upgrade nearly all of its networks to gigabit speeds, reportedly plans to use DOCSIS 3.1. And Time Warner Cable specified DOCSIS 3.1 in its bid to deploy gigabit service in Los Angeles.
In markets where the telco lacks FTTP, DOCSIS 3.1 may be a more-than-adequate offering for the cablecos for the forseeable future. But depending how pronounced the trend toward symmetry becomes, cablecos in telco FTTP markets could find themselves looking seriously at FTTP or other alternatives to DOCSIS 3.1.
What about wireless?
I haven’t heard much about the ratio of downstream-to-upstream traffic on the wireless side, but it would be logical to expect similar trends there.
Sprint has touted the ability of its TD-LTE network to support higher downstream data rates to align with mobile data traffic patterns – a capability that doesn’t exist with the symmetrical FDD-LTE networks that other major wireless operators have deployed. But it’s unclear how important Sprint’s flexibility will be in the long term.
Meanwhile, I’m thinking that companies like AT&T and Verizon probably talked to the FCC about the trend toward symmetry in discussions about the band plan for the upcoming auction of 600 MHz broadcast spectrum. Despite requests from some competitive carriers for unpaired spectrum, the commission appears to have settled on paired – a.k.a. symmetrical -- spectrum for the 600 MHz band.
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