Thursday, May 28, 2009
Open Access Makes Economic Sense
My friend Benoit Felten (with co-author Wally Swain), has written a Yankee Group report entitled "Open Access Makes Economic Sense." It begins:
Analysis of a series of high-level generic next-generation access business models suggests that on the basis of the current generation of services, the revenue-generating opportunity will not offset the costs in a reasonable amount of time for the vertically integrated service provider deploying it. Opening the network to competitive or new service providers is one of the solutions to solve that conundrum.
The business model for fiber to the home (FTTH) is a tough one to make fly. Despite the increasing pressure (competitive and political) for wireline copper operators to upgrade their networks to FTTH, the economics of the business model scare both the telcos themselves and their shareholders or financiers. This report examines the greenfield deployment business model in depth and looks at how it might be optimized.
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