Get more fibre in business diet

Sunday Business Post - Computers in Business Magazine - November 2 2008

See this article on the Sunday Business Post's website by clicking here.

Fibre-optic cables will allow new speeds for internet access for business, writes Dermot Corrigan.

Most Irish businesses access the internet using a mix of traditional copper wires and more recent fibre-optic technology. Generally, there is a copper link from the business premises to the closest point on national or private underground fibre networks. That is the basis for the majority of high-speed broadband packages offered by the various vendors.

However, more and more companies are looking to get fibre to the premises (FTTP) links, which involve no copper and link the company directly into the national or private fibre system. This is because fibre is just downright better than copper for meeting a modern company's high-speed communications requirements, according to John Quinn, regulatory and development director with Smart Telecom.

"Fibre is simply the best medium to provide telecommunications services," said Quinn. "It offers practically unlimited capacity, very high security, symmetrical speeds and excellent quality of service. It does cost more than traditional copper-based services, but it is a matter of balancing quality and cost to the business need. Not all businesses need fibre, but for those that do, it is a value-for-money investment."

Liam Collins, head of products, enterprise and government market at Eircom, said that once a customer was looking for over 10MB download speeds, fibre was generally the answer.

"Whether you choose copper or fibre really depends on the amount of bandwidth you require, either for normal network services or for access to the internet,’' Collins said. "Generally speaking, if you require speeds of10MB or above, you would go for fibre. It just comes down to speed. Most customers would be using a variety of applications on their Wan [wide area network] such as e-mail applications, customer relationship management software or enterprise software like SAP or Oracle, a whole host of things.

"They would also probably be looking to connect their Lan [local area network] in Dublin to their Lan in Cork, for instance. If they need a high-speed connection, they would go for a fibre-based product."

Seamus Walsh, managing director wholesale for BT in Ireland, said that larger offices typically now required fibre-connectivity, just so their staff could go about their daily business. "The more people you have in an office building using the internet, the more demand there is on the connection," said Walsh. "If you have a building full of people who need to connect to the internet you eat up the capacity very quickly. The more commerce that is driven onto the internet, the more connection you need.

"As software systems develop they become more bandwidth hungry, it is just the natural progression of things. People get used to faster bandwidth speeds. Instead of being happy just to send an e-mail, they now expect to be able to watch YouTube and other videos pretty much instantaneously."

Collins said that smaller companies with a specific business need for high-speed internet access were also investing in fibre links.

"There is a change in the marketplace,’' Collins said. "Two years ago, it was only larger companies that were investing in fibre, but now we are finding that SMEs are finding that their bandwidth requirements are increasing dramatically, so we are now installing fibre-based products in companies that would have surprised me a few years ago."

This was being driven by reductions in the cost of fibre products, according to Collins.

"The price has already come down from the first fibre products we launched five or six years ago," he said. "The product that gives ethernet and IP network access to customers is now a fraction of the price that it was. That will continue to happen."

Getting the fibre in

Quinn said that the costs involved in companies connecting directly to national or private fibre networks varied depending on individual circumstances. "It very much depends on how close the company in question is to a fibre-optic network," he said. "Fibre itself is not that expensive and neither is the equipment needed. What tends to be expensive is the cost of digging the road from the company in question to the closest fibre network. For some companies, this makes the installation costs prohibitive." Geographical location was a major factor in determining the price of getting the fibre in, according to Quinn.

"The Mans [metropolitan area networks – public-owned fibre systems which can be used by private operators] go some way to helping here, as do private networks such as the T-50 in Dublin, which is owned by Smart," he said. "In most population centres, such as Dublin, Cork and Galway, it is relatively easy to get a fibre connection, in particular in business and commercial centres. There are 27 other towns that currently have a government Man."

Collins said that most companies in urban centres were relatively close to the existing public fibre network. "If they are in a major city, there is a reasonable chance they will be in striking distance of fibre," he said. "We can do a survey to see how costly it will be to get access to the fibre network. Usually, they will be within a few hundred metres, or maybe a kilometre, of the existing fibre network. Sometimes, however, there will be more distance, which might involve digging a trench to link them in."

Walsh said that street cabinets on city and town streets contained access points to the national fibre network. "We would bring fibre to the cabinet and then copper to the customer's premises," he said. "The fibre would go from one of our core sites or data centres out to the customer, and we would interconnect it back out to the other side." The majority of the cost involved in a fibre implementation was bound up in digging up the ground to lay the cable, Walsh said.

"The greatest cost is the actual physical digging of the trench to carry the cable into the customer," he said. "In most cases, the re striction is the length of dig required. Nowadays, if we are going to dig into the customer, we would always deliver fibre, as they would probably already have a copper connection in already." Collins said that the costs of installing the fibre therefore varied greatly from site to site.

"It is difficult to talk about costs, as they vary so much," he said. "But you could start at €8,000 for an install of fibre access. Once you get the fibre access in, the services can be layered on top of that very cost effectively. So, while the first cost might seem pricey, you can add further services and bandwidth extremely cost-effectively." Mark Kellett, chief executive of Magnet Networks, said that many new developments installed fibre connections during the build.

"The majority of businesses Magnet runs fibre to would be new developments such as mixed-use with residential, retail and commercial space, or large commercial buildings with a number of tenants,’' said Kellett. "It makes economic sense that, when the construction is under way, it is the cheapest time to lay the fibre, before the roads are even built." Many new business parks or industrial areas in towns are being developed with fibre-connectivity in place, according to Kellett.

"There are a number of business parks openly touting their high-speed internet capability to attract tenants, they are even advertising on the radio," he said. "A high proportion of new large business parks being built around the country would have fibre access. It is not unique to Dublin." Quinn said that easier access to fibre-connectivity was in store for companies in smaller towns around Ireland. "The Mans will be available to a further 66 towns from around the end of this year."

Unblocking the systems

Quinn said that companies investing in fibre links should not be worried that a new faster technology would displace it in the short or medium term. "Wireless has natural spectrum limitations, particularly in terms of capacity," he said. "Copper suffers badly from interference and speeds are directly related to distance. Fibre, however, is virtually limitless and can send information over vast distances as it is immune to most forms of natural interference." Kellett said that fibre connections were easily scalable, so companies could ramp up their bandwidth as required.

"If your business grows and grows and you have a huge volume of data going across the network, you do not have to worry about the piece of copper reaching its maximum, and having to get more and more lines into your building," he said. "The one fibre link will allow you to grow and grow." Col lins said that call costs did not increase quite as rapidly. "The cost increases are not as big as you increase bandwidth," he said. "It is almost like a discount scheme, a 10MB is not five times the cost of a 2MB scheme. It might be twice the cost, but you have five times the bandwidth."

Fibre's ability to deliver symmetric, uncontended (not shared) connectivity was another advantage, Collins said. "The fibre service is symmetric, so you can have the same download and upload speeds," he said. "That is especially useful for customers who have applications where they want to upload large amounts of information to the net."

Kellett said that fibre allowed providers to offer extra services, alongside high-speed broadband. "Providers are starting to offer a large diverse range of services, things like voice over IP [VoIP], virtual call centres, virtual PBXs [telephony systems], managed IT support services. With the kind of speeds we are talking about, you can do a lot more." Collins said that not everyone needed to rush out to invest in fibre connectivity, as copper would continue to meet the requirements of many smaller firms going forward. "Copper provides quite cheap access for people who require lower bandwidth services," he said. "It would depend on the size of the customer's site, but fibre will not completely replace copper."

Walsh said that the technology underpinning copper connections was also improving. "With advances in DSL technology that sits on the copper, you are actually beginning to be able to deliver higher bandwidth over the copper infrastucture," he said. "Very high bit-rate DSL [VDSL] can deliver 24MB to a customer and, for many people, that is quite a significant amount of bandwidth. They would also be able to put VoIP onto that line as well. You would have a data and voice connection to the internet on copper. Five or six years ago, you would have needed fibre for that service, but now it can be delivered through copper." Kellett said that more widespread fibre networks would be required in Ireland as demand for highspeed internet access expanded in the future.

"It is something that will last us 20 to 25 years," he said."Copper is not going to last us, and fibre is the future. BT is doing a major investment in fibre, in Britain, and Telefonica is doing a major rollout in Madrid. It is recognised now by the leading European telcos as mission-critical. They realise that in order to offer new and diverse services they need to be rolling out fibre." Quinn said the Irish government was currently looking at how to expand the public fibre network, which could then be used by private operators to offer fibre-based services, and would make fibre available to more locations around the country.

"The government can encourage all parties to look at such investments with many of the items outlined in minister Eamon Ryan's NGN [next generation networking] consultation," he said. "By making ducting available to operators [one example, there are many others] and mandating that new developments have adequate and correct duct infrastructure installed on a neutral basis, the government will make the business case for FTTP more attractive. The new Mans will also assist in bringing more fibre services to more businesses in Ireland."