Business Model for an FTTx Deployment: Modelling the Cost and Revenue Structure
This report presents a business model for an FTTx network rollout, detailing the main cost items. One of its main objectives is to help understand the trade-offs involved when choosing the technologies to deploy, setting priorities and establishing rollout schemes, depending on the country and the area to be covered.
The presented business model, delivered in Excel format along with the report, is a parametric model that makes it possible to calculate an FTTx rollout’s key performance indicators (KPI) according to different possible technical configurations, and rollout locations.
The key metrics of an FTTx rollout (EBITDA, EBIT, cumulative CAPEX, cumulative FCF, per-subscriber CAPEX, cost per subscriber based on penetration rate) can be viewed as graphics, using various configuration options:
The presented business model, delivered in Excel format along with the report, is a parametric model that makes it possible to calculate an FTTx rollout’s key performance indicators (KPI) according to different possible technical configurations, and rollout locations.
The key metrics of an FTTx rollout (EBITDA, EBIT, cumulative CAPEX, cumulative FCF, per-subscriber CAPEX, cost per subscriber based on penetration rate) can be viewed as graphics, using various configuration options:
- area (type of area by population size, density)
- technique (% of ducts installed, leased, overhead, already available)
- sales data (four levels of ARPU, churn)
- coverage (initial, maximum, penetration)
1. EXECUTIVE SUMMARY
1.1. Presentation of the model
1.2. Recommendations
2. STRUCTURE OF THE FTTX BUSINESS MODEL
2.1. FTTx network architectures
2.1.1. Technologies used to deploy FTTx networks
2.1.2. FTTx deployment value chain
2.2. Description of Opex and Capex in the FTTx business model
3. FTTX COSTING MODEL SETTINGS
3.1. Technical configurations used in the FTTx costing model
3.2. FTTx business model revenue and cost settings
3.2.1. FTTx business model revenue setting
3.2.2. FTTx business model cost settings
4. MODELLING SCENARIOS WITH PREDEFINED SETTINGS
4.1. Key performance indicators
4.2. Modelling scenarios with predefined settings
4.2.1. Urban zone
4.2.2. Suburban zone
4.2.3. Rural zone
4.2.4. Analysis of results
4.3. Modelling scenario for deployment across national territory
4.3.1. Case scenario for national deployment in a European country, excluding rural zones
4.3.2. Case scenario for the same national deployment programme in a European country, this time including rural zones
4.3.3. Comparison between the two deployment programmes
4.4. Main barriers to and facilitators for superfast broadband profitability
1.1. Presentation of the model
1.2. Recommendations
2. STRUCTURE OF THE FTTX BUSINESS MODEL
2.1. FTTx network architectures
2.1.1. Technologies used to deploy FTTx networks
2.1.2. FTTx deployment value chain
2.2. Description of Opex and Capex in the FTTx business model
3. FTTX COSTING MODEL SETTINGS
3.1. Technical configurations used in the FTTx costing model
3.2. FTTx business model revenue and cost settings
3.2.1. FTTx business model revenue setting
3.2.2. FTTx business model cost settings
4. MODELLING SCENARIOS WITH PREDEFINED SETTINGS
4.1. Key performance indicators
4.2. Modelling scenarios with predefined settings
4.2.1. Urban zone
4.2.2. Suburban zone
4.2.3. Rural zone
4.2.4. Analysis of results
4.3. Modelling scenario for deployment across national territory
4.3.1. Case scenario for national deployment in a European country, excluding rural zones
4.3.2. Case scenario for the same national deployment programme in a European country, this time including rural zones
4.3.3. Comparison between the two deployment programmes
4.4. Main barriers to and facilitators for superfast broadband profitability
TABLES
Table 1: Main income statement items and key drivers
Table 2: Model cost settings
Table 3: Key performance indicators for the very dense urban zone
Table 4: Key performance indicators for the dense urban zone
Table 5: Key performance indicators for the moderately dense urban zone
Table 6: Key performance indicators for the suburban apartment block zone
Table 7: Key performance indicators for the suburban single-family house zone
Table 8: Key performance indicators for the concentrated rural zone
Table 9: Key performance indicators for the rural zone
Table 10: Zone settings
Table 11: Coverage settings
Table 12: Technical settings
Table 13: Cumulative investment for a greenfield operator over ten years
Table 14: Cumulative investment for an incumbent operator over ten years
Table 15: Cumulative investment for a non-incumbent operator over ten years
Table 16: Zone settings
Table 17: Coverage settings
Table 18: Technical settings
Table 19: Cumulative investment for a greenfield operator over ten years
Table 20: Cumulative investment for an incumbent operator over ten years
Table 21: Cumulative investment for a non-incumbent operator over ten years
Table 22: Summary of the main key factors and barriers to superfast broadband profitability
Table 1: Main income statement items and key drivers
Table 2: Model cost settings
Table 3: Key performance indicators for the very dense urban zone
Table 4: Key performance indicators for the dense urban zone
Table 5: Key performance indicators for the moderately dense urban zone
Table 6: Key performance indicators for the suburban apartment block zone
Table 7: Key performance indicators for the suburban single-family house zone
Table 8: Key performance indicators for the concentrated rural zone
Table 9: Key performance indicators for the rural zone
Table 10: Zone settings
Table 11: Coverage settings
Table 12: Technical settings
Table 13: Cumulative investment for a greenfield operator over ten years
Table 14: Cumulative investment for an incumbent operator over ten years
Table 15: Cumulative investment for a non-incumbent operator over ten years
Table 16: Zone settings
Table 17: Coverage settings
Table 18: Technical settings
Table 19: Cumulative investment for a greenfield operator over ten years
Table 20: Cumulative investment for an incumbent operator over ten years
Table 21: Cumulative investment for a non-incumbent operator over ten years
Table 22: Summary of the main key factors and barriers to superfast broadband profitability
FIGURES
Figure 1: Key performance indicators
Figure 2: Superfast broadband fixed network architecture
Figure 3: Value chain for deployment of an FTTx network
Figure 4: General structure of the model
Figure 5: Two-splitter GPON technology
Figure 6: Single-splitter GPON technology
Figure 7: Ethernet point-to-point technology (P2P)
Figure 8: Layout of the selected FTTN + VDSL architecture
Figure 9: Zone settings and key performance indicators
Figure 10: Variation in average per-subscriber investment by type of zone, for a 30% relative penetration
Figure 11: Distribution of population by type of zone
Figure 12: Comparison of the investment between the deployment programme of an FTTH/VDSL network covering only urban and suburban zones, and a deployment programme covering all zones
Figure 13: Distribution by zone of total investment for the full FTTH network deployment programme over ten years
Figure 1: Key performance indicators
Figure 2: Superfast broadband fixed network architecture
Figure 3: Value chain for deployment of an FTTx network
Figure 4: General structure of the model
Figure 5: Two-splitter GPON technology
Figure 6: Single-splitter GPON technology
Figure 7: Ethernet point-to-point technology (P2P)
Figure 8: Layout of the selected FTTN + VDSL architecture
Figure 9: Zone settings and key performance indicators
Figure 10: Variation in average per-subscriber investment by type of zone, for a 30% relative penetration
Figure 11: Distribution of population by type of zone
Figure 12: Comparison of the investment between the deployment programme of an FTTH/VDSL network covering only urban and suburban zones, and a deployment programme covering all zones
Figure 13: Distribution by zone of total investment for the full FTTH network deployment programme over ten years
