Fixed Broadband Access Sales Up 8% in Q4 2018: Dell'Oro

Service providers continue to invest on broadband access equipment, with global revenue increasing to $3.4 billion in the fourth quarter 2018, up 8% from the same period in 2017, according to a recent Dell'Oro Group report.

With 5G's arrival, telcos are opening their network budgets, said Jeff Heynen, research director for Broadband Access and Home Networking at Dell'Oro Group. Both 2.5 Gbit/s GPON and 10 Gbit/s EPON saw year-over-year increases, especially in China which is standardizing on 10 Gbit/s EPON, he said. Total PON ONT unit shipments increased 6%, driven by strong demand for 2.5 Gbit/s GPON units in China and the Asia-Pacific region, in general.

"The 10-gig EPON generation is now starting to hit the market in decent, measurable… and that will definitely continue. It really started to pick up in the second half of last year," Heynen told Broadband World News. "A lot of it is coming from China, but you have growing deployments of it in other parts of the world now, too. I really think XG-PON is the 10-gig, non-EPON technology that's going to win-out here. Anything that doesn't use [expensive] coherent optics or multiple wavelengths for residential apps, where margins are lower, those are the type of technology you want."

Service providers' spending on total DSL port shipments increased 16% year-over-year, with VDSL ports growing 13% and Gfast ports increasing 232%, according to the 4Q 2018 Broadband Access Quarterly Report.

Telco spending offset "surprising weakness in cable CCAP spending," which Heynen attributed to MSOs' delayed capacity purchases as they decided how to advance with distributed access architectures (DAA).

With most cable operators having recently wrapped up or neared completion of DOCSIS 3.1 deployments, they seem more loathe to begin heavily investing in the next necessity. But soon MSOs will move beyond investigating DAA now many recognize the myriad benefits, including increased network capacity, simplified outside plant maintenance and node evolution with Remote PHY, Remote MAC-PHY and Remote 10G EPON OLT, said Heynen.

As a result of a slowdown in CCAP license purchases in North America, total cable access concentrator revenue decreased 18% in 2018 versus 2017, dropping to $380 million, Dell'Oro's report said.

Related posts:

• DAA Upgrades Could Bring Boon to Cable Vendors
• China's Telcos Spark PON Revenue Rebound
• Gfast Stampede Starts in 2019 – Report

— Alison Diana, Editor, Broadband World News. Follow us on Twitter or @alisoncdiana.