Telefónica has launched a 100-Mbps FTTH access in Spain, following the local broadband market. The offering is initially available in Bilbao and San Sebastian de los Reyes, a municipality within the Madrid region.
The company launched its 30-Mbps FTTH offering in the end of last year, and the newest one is the fastest broadband service commercially available in Spain—previously cable operator Ono's 50 Mbps had held the top spot.
Demand for FTTH is still nascent in Spain, with regulator CMT reporting just 5,000 accesses for end-March. As the services develop and demand picks up over time, the CMT's forecast estimates that the networks will be within the reach of over 40% of the country's population by 2023. IHS Global Insight sees that the biggest question-mark over the deployments will be the model for sharing the civil infrastructure accommodating the actual fibres—since no alternative roll-outs have been announced thus far, this factor remains untested.
Spanish incumbent Telefónica has commercially launched a 100-Mbps fibre-to-the-home (FTTH) broadband offering in Spain, reports website adslzone.net. The new service is initially available in Bilbao and San Sebastian de los Reyes—a municipality close to Madrid, the capital—and comes with an activation fee of 13.97 euro (US$19.79), the same Telefónica has for traditional copper-wired accesses. The connections have been deployed on a greenfield basis, i.e. to new buildings with no existing copper lines.
* Only By Telefónica: Being the only Spanish operator which so far has rolled out fibre and having a regulatory holiday from the wholesale obligation for access speeds of 30 Mbps and above, Telefónica's FTTH connections are the fastest available in Spain. The company launched its 30-Mbps offering in the final quarter of last year, and this newest provision sets a new bandwidth benchmark for the highest end of the market—until now, Ono, the country's largest cable operator, has been able to deliver 50 Mbps in some parts of its Madrid network. According to regulator CMT, as of end-March this year the FTTH accesses totalled just 5,200, and we expect the short-term uptake of the services to remain similarly modest also for the rest of 2009. On one hand, this is because of currently low consumer demand for such speeds, and on the other hand because of Telefónica's scaled-down fibre investments—pressed by the slump in the economy and having concluded that demand for FTTH is unlikely to pick up anytime soon, the company correspondingly cut its domestic fixed-line capex by 25.7% year-on-year (y/y) in the first half of the year.
* Over 40% FTTH Coverage Forecasted for 2023: Beyond the early days, the regulator forecasts that the FTTH coverage will gradually increase to reach 43—46% of the country's households by 2023. According to the same analysis, all municipalities larger than 1,000 inhabitants will have return-on-investment high enough to support at least one alternative FTTH provider in addition to the incumbent—in Madrid, the number of competitors is expected to be two or three, and in Barcelona three or four. As yet, none of Telefónica's competitors has announced anything concrete on fibre deployments, although France Telecom's local unit has hinted that it will study the possibility of cooperating with other alternative carriers on the roll-outs. IHS Global Insight believes that the key issue concerning the further fibre investments is to establish a functioning model under which the rivals can efficiently share the civil infrastructure holding Telefónica's fibres, as the excavation-related costs form such a substantial part of the deployment expenditure. For the time being, with no alternative deployments been announced, this factor remains untested.
