Fibre To The Home is Trending Up in Australia

Fibre connection in Australia

FTTH promises higher data speeds

If there’s one thing Aussies seem to love, it’s fast internet. And the telcos are doing their best to keep up with consumer demand for high speed downloads and browsing, evident from the 5G rollout and broadband networks like fibre.

Fibre To The Home (FTTH) has seen some impressive growth recently, and analysts forecast even more growth in the coming years. In fact, the entire telco market is set to grow, and a huge driving force behind that growth are data plans.

In this article, we’ll explore the reasons behind Australians’ demands for high speed data, and discuss how the trending FTTH is becoming a favorite for consumers.

What is FTTH?

FTTH (or FTTP – Fibre To The Premises) refers to fibre internet – essentially delivering data from the service provider to your home or business via fibre optic cable. Fibre optic cables provide more room for Internet traffic than copper cables and other traditional fixed wired broadband connections.

The NBN already has fibre connections available, but mostly Fibre To The Node connections (FTTN). This refers to fibre internet which isn’t connected directly to the home, but rather to a central location from which data is then distributed to surrounding homes and business without fibre optic cables – DSL, existing telephone lines, or cable lines are used instead.

FTTN is a lot less efficient than FTTH because several homes share the traffic from the node, and communication is carried out via cables that are inferior to fibre. Because FTTH provides a more direct connection, traffic is reduced and performance (especially speed) is improved.

Current market trends point to high speed data as major growth driver

GlobalData Australia Mobile Broadband Forecast Model has predicted a 15.4 percent Compound Annual Growth Rate (CAGR) for the mobile market between 2020 and 2025. Data services are a significant contributor to that growth, with a forecast of 16.7 percent CAGR during that same period.

The key data services growth driver 5G plans. The report indicates that, between 2020 and 2025, 5G subscriptions will grow from 5.7 percent of the the mobile data sector to 34.7 percent.

That predicted huge spike can be explained by Australian consumers’ desire for fast, high speed data plans. And there is more evidence of this in the expected growth in the Fibre To The Home (FTTH) sector as well.

FTTH market set to grow

The NBN is now rolling out FTTH in an effort to convert FTTN connections. With 5G broadband increasing the competition in the broadband space, wired networks need to improve speed and efficiency to remain relevant.

The NBN has set a goal of 2 million homes by 2023 to be converted to FTTH. This aggressive approach is bound to see a rise in subscriptions to fixed wired connections.

According to the latest GlobalData report, the growth forecast for fixed communications services revenue is quite slim – just a CAGR of 0.7%, marking an increase from US$9.9 billion in 2020 to US$10.2 billion in 2025.

However, the major driver behind that growth is fibre services. The same report predicts that fixed broadband will grow at 4.5% CAGR between the same period. And while fibre is a growth driver, fixed wireless broadband services will also contribute to the growth.

Fibre vs 5G broadband

Australians want speed, and both FTTH and 5G will give them that. And while the mobile data market is set to boom, fixed broadband is improving as well.

Fibre has its advantages – high bandwidth and fast speeds – over traditional fixed broadband networks. But 5G has advantages as well – it can provide fixed wireless broadband for homes, and maintain very high speeds as well. With both options available to consumers, reliable high speed data will no longer be difficult to find. Both are fixed broadband services, so your needs will determine which one to choose.

However, keep in mind that FTTH has the advantage of reach – that is, the fixed wired service is being rolled out aggressively by the NBN into rural and regional areas, not just urban areas. This means that areas where reliable high-speed data were impossible will now have access to reliable Internet. FTTH holds this advantage over 5G fixed  wireless broadband because the NBN will likely rollout FTTH a lot faster than the major telcos will roll out 5G. In that case, if you’re in an area without 5G coverage, then FTTH will be a great alternative.

 

Neil Aitken

Having worked in 3 countries for 4 telcos on both voice and data products, Neil is in a position to give you the inside track. Get beyond the marketing messages to the best plan for you.