Roland Montagne

Principal Analyst
+33 6 80 85 04 80
r.montagne@idate.org

FTTH Council Europe – Panorama & Forecast

Market at September 2018 & Forecast by 2020 & 2025

FTTH Council Europe Conference – March 14th 2019 - Amsterdam

 Agenda
Agenda

1. Study Background
2. General overview and main trends
3. Leading countries
4. European Ranking
5. Conclusion – Key outputs – Global Ranking
6. FTTH Forecast for Eueope
01 Study Background
 Methodology
Methodology
▪ Mission on behalf of the FTTH Council Europe – 17th edition
▪ Provide a complete summary of the status of FTTH/B in Europe at Sept. 2018

ACTIONS

Scope Bottom-up Results

methodology
• Analysis of 39 countries
• Desk research • Both quantitative and
• Data per player for FTTH/B qualitative data
• Direct contacts with leading
and other fibre-based
architectures
players and IDATE partners • Market status in the country
within countries
• Key parameters study: • Strategic approach of involved
• Information exchange with players
technical, financial, business
FTTH Council Europe members
model, figures
 General overview
02 and main trends
 FTTH/B figures as at September 2018
FTTH/B figures as at September 2018
As at September 2018 in EU39*:
▪ 59.6 million FTTH/B subscribers Subscriber evolution
>x6
▪ Almost 160 million FTTH/B Homes Passed
Homes Passed evolution
>x4
FTTH Council Europe scope at September 2018
39
countries
covered
FTTH/B market evolution in terms of Homes passed and Subscribers
(EU39)
Take-up rate 160
EU28 : 38.2% 149
EU39 : 37.4% Subscribers Homes Passed 140
126
EU28 countries 108

Covered
countries in 77
FTTH Panorama 64
60
52
Coverage rate 42
36
45
EU28 : 36.4% 31
EU39 : 46.4% 16 20
11

September September September September September September September September

2010 2012 2013 2014 2015 2016 2017 2018
(1) EU39 = EU28 (excl. Cyprus) + 4 CIS countries + Andorra, Iceland, Israel, Macedonia,
Norway, Serbia, Switzerland, Turkey
Source: IDATE for FTTH Council EUROPE
(2) Cyprus was replaced by Macedonia at end-2012 because the FTTH/B market is much more
developed in this country.
 Historical data and growing trends (EU28 / EU39)
Historical data and growing trends (EU28 / EU39)
▪ EU28 has a stronger position in the whole European region
▪ By Sept. 2018, half of FTTH/B deployments are performed inside of the EU28 countries, an increasing trend along the previous
years

Evolution of FTTH/B Subscribers (million) Evolution of FTTH/B Homes Passed (million)

Comparison EU28 / EU39 160
60 Comparison EU28 / EU39 149
140
52
126
45
108
36
31 30 77 81
73
24 64 67
20 57
20 51
16 15 42
12 36
11 29 30
7 8 23
6 15
4 5

December December December December December September September September September December December December December December September September September September
2010 2011 2012 2013 2014 2015 2016 2017 2018 2010 2011 2012 2013 2014 2015 2016 2017 2018

Total EU28 Total EU39 Total EU28 Total EU39

Source: IDATE for FTTH Council EUROPE

 Incumbents are taking a growing role in FTTH/B Initiatives
Incumbents are taking a growing role in FTTH/B Initiatives
▪ Analysis of around 400 FTTH/B projects in EU39 at September 2018
▪ Around 55% of total Homes in the region have been passed by Alternative ISPs, and approx. 41% by incumbents (as compared to
21% by incumbents in 2011)
▪ Municipalities/Local Authorities, along with utilities when appropriate, will remain those ones that will help ensure an exhaustive
coverage at term
Top European countries – Breakdown in terms of Sockets deployed
Breakdown of FTTH/B Sockets deployed by type of player (%) Total Sockets deployed: 71,435,000
Data comparison between Dec. 2011 and Sept. 2018 1 ✓ Incumbents: 33,200,000
Russia ✓ Alternative ISPs: 38,235,000
4%
Total Sockets deployed: 43,234,160
8%
21%
2 Spain
✓ Incumbents: 20,800,000
✓ Alternative ISPs: 22,375,000
✓ Municip./Utilities: 59,160

41% Total Sockets deployed: 39,201,000

55% 3 France
✓ Incumbents: 10,906,000
✓ Alternative ISPs: 26,565,000
71% ✓ Municip./Utilities: 1,730,000

Total Sockets deployed: 10,765,000

December 2011 September 2018 4 Ukraine
✓ Alternative ISPs: 10,765,000

Source: IDATE for FTTH Council EUROPE Total Sockets deployed: 9,124,750
5 Romania
✓ Incumbents: 2,107,000
✓ Alternative ISPs: 7,017,750
03 Leading countries
 General Ranking: FTTH/B Homes passed
European ranking in terms of FTTH/B Homes passed over time (in million homes)
Data comparison between Sept. 2015 and Sept. 2018 Top 5 annual growth rates – Homes passed (in %)
60
Data from Sept. 2017 to Sept. 2018

Sept. 2015 Sept. 2016 Sept. 2017 Sept. 2018

+ 43.1 %
50 Italy
17 countries
with more than
40
2m. HP + 40.5 %
EU28 : 11 Poland
countries in the
Millions

30 Ranking
+ 22.8 %
UK

20

+ 17.4 %
Portugal
10

+ 15.1 %
0
Germany

Source: IDATE for FTTH Council EUROPE

 General Ranking: FTTH/B Sockets deployed*
European ranking in terms of FTTH/B Sockets deployed (in million homes) Top 5 annual growth rates – Sockets deployed (%)
Data comparison between Sept. 2015 and Sept. 2018 Data from Sept. 2017 to Sept. 2018

80
Millions

Sept. 2015 Sept. 2016 Sept. 2017 Sept. 2018 + 77 %

70
18 countries with Italy
60 more than 2m.
Optical sockets
+ 40.5 %
50
Poland
40
EU28 : 12
countries in the
30 Ranking + 36.9 %
France
20

10 + 26.2 %

0 Spain

+ 22.8 %
UK
*Total amount of FTTH/B optical sockets deployed by each player in a
country (may be higher than Homes Passed when homes are covered Source: IDATE for FTTH Council EUROPE
by several players). Might lead to overlap situations
 General Ranking: FTTH/B Coverage
Coverage
rate
FTTH/B coverage* as at September 2018 EU28 : 36.4%
(* Homes passed / Households) EU39 : 46.4%

91%
FTTH/B coverage > 90% Sweden

FTTH/B coverage 70 – 90 %
FTTH/B coverage 50 – 70 %
FTTH/B coverage < 50 % 96.4%
Latvia

95.4%
Lithuania

99.9%
Andorra

99.2%
Portugal 91%
Bulgaria

97.8%
Spain

Source: IDATE for FTTH Council EUROPE

 General Ranking: FTTH/B Subscribers
General Ranking: FTTH/B Subscribers
European ranking in terms of FTTH/B Subscriptions (million)
25,000,000 Data comparison between Sept. 2015 and Sept. 2018

20,000,000
+ 83.2 % + 72.5 % + 36 %
UK Italy Poland

15,000,000

+ 35.1 % + 30.7 %
France Spain
10,000,000

5,000,000

Sept. 2015 Sept. 2016 Sept. 2017 Sept. 2018

 General Ranking: FTTH/B Take-up
Take-up rate
EU28 : 38.2%
EU39 : 37.4%

FTTH/B take-up* as at
September 2018
(*Subscriptions / Homes Passed)

FTTH/B take-up > 50%

FTTH/B take-up 40 – 50 % 52.2%
FTTH/B take-up 30 – 40 % Latvia
FTTH/B take-up < 30 % Netherlands
51.5% 64.5%
Belarus

61.4% 51.2%
Belgium 52.6%
Andorra
Romania

Source: IDATE for FTTH Council EUROPE

04 European Ranking
 European Ranking as at September 2018
Latvia
Lithuania Penetration rates of European countries at September 2018
Spain (FTTH/B Subscriptions / Households)
Sweden
Belarus
Romania
Portugal
Norway
▪ Includes countries of +200k Households in which
Russia FTTH/B subscribers represent at least 1% of total
Bulgaria households
Estonia
Finland FTTH subscribers
Slovakia
Slovenia
FTTB subscribers ▪ Eastern Europe and Nordic countries are among the
Netherlands top of penetration ranks, mainly due to a proactive
France state intervention towards fibre expansion
Luxembourg
Denmark Penetration rate
Hungary
Kazakhstan
EU28 : 13.9% ▪ Some major European countries are lagging behind
Czech Republic (except. Spain and Portugal) due to a predominance of
EU28 copper-based technologies (VDSL, G.Fast) and/or
Macedonia
Turkey cable networks (DOCSIS 3.0 / 3.1)
Ukraine
Switzerland UK is entering the
Poland Ranking by Sept.
Italy 2018
Ireland
Germany
Serbia
Croatia
Austria
United Kingdom
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%
05 Key Conclusions
 Key outputs
• Public-private initiatives are the key trend of 2018: more and more involvements from public
authorities (via subsidies and an adequate policy framework) to promote fibre expansion
Public throughout their country
• Progressive move towards fibre expansion in hard-to-reach areas: urban dense areas are well
involvement covered by fibre networks in Europe, the focus for public & private actors is now on remote areas.
How to promote high-speed broadband access in these isolated areas?

• Pent Up Demand becoming clear: Seeing large pent up demand (high connection rates) in regions
now just beginning large FTTH rollouts (UK / Italy)
• EU28 is Mobilizing for FTTH/B: EU28 now catching up and surpassing the growth trends seen across
Regional the larger EU39
Recap • EU39 region has reached almost 160 million homes with FTTH/B networks, representing a coverage
of 46.4% of the total Homes
• Countries like Italy, Poland and UK have experienced strong growth, increasing their homes passed
by more than 20%, as well as their subscribers by more than 36%

Subscribers Homes Passed Subscribers Homes Passed Subscribers Homes Passed

+ 72.5 % + 43.1 % + 36 % + 40.5 % + 83.2 % + 22.8 %

Italy Poland UK
Global Ranking(*) at Sept. 2018 – Mature markets
UAE FTTH/B Penetration rates worldwide at
Qatar
September 2018
Singapore (FTTH/B Subscriptions / Households)
China
South Korea
Hong Kong GCC and APAC countries leading
Japan the ranking
Mauritius
New Zealand
Uruguay
Latvia
Taiwan
(*) Includes countries of +200k Households in which FTTH/B
Lithuania
subscribers represent at least 1% of total households
Spain
Sweden
Vietnam FTTH subscribers
Belarus FTTB subscribers
Romania
Portugal
Norway
Russia
Bulgaria
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%
Global Ranking (*) at Sept. 2018 –
Less than 30% penetration
Estonia
Finland
Slovakia
Slovenia
Malaysia
Netherlands
France
Luxembourg
Trinidad and Tobago
Denmark *Includes countries of +200k Households in which FTTH/B
Jamaica
Hungary subscribers represent at least 1% of total households
Australia
Kazakhstan FTTH subscribers
Czech Republic
Mexico
Saudi Arabia FTTB subscribers
Ecuador
United States
Canada
Macedonia
Turkey
Ukraine
Oman
Chile
Switzerland
Kuwait Some European countries still
Poland
South Africa lagging behind
Puerto Rico
Brazil
Italy
Ireland
Argentina
Colombia
Germany
Angola
Serbia
Croatia
Austria
United Kingdom
Jordan

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%
06 FTTH Forecast for Europe
 FTTH/B figures as at September 2018
Forecast study – Factors taken into account
Supply criteria Demand criteria Others
• Strategic plans from telecom players • Broadband services take-up since average • Impact of infrastructure costs
towards high-speed broadband speeds continue to rise for households • Impact of copper-based DSL
enhancement • Data consumption keeps growing due to improvements with new emerging
• Willingness to provide public funds an intensive use of video content, high- variants, such as G.Fast.
• Municipality/utility players can accelerate definition streaming which demand high • Impact of cable-based networks with
fibre development in remote areas, where bandwidth capacity DOCSIS 3.1
private operators don’t have any • People in rural areas still not covered by • Regulatory changes at European and
incentives to deploy high-speed connections would like to be national level to create a common
• Impact of cable operators switching to connected to NGN commitment to FTTH
FTTH/B to gain market advantages • Impact of macroeconomic environment
• Impact of mobile broadband and economical trends
enhancement
• Green-field housing and systematic
deployment of FTTH in any new build
housing
Indicators
Historical affecting thetrends
data and growing FTTH adoption
(EU28 / EU39)
Positive criteria

1 Regulatory framework and public incentives to promote FTTH deployments (ex. Gigabit
Society targets set for 2025)

2 Governments have been revising their Digital Infrastructure strategy to focus on Fibre and 5G
leading to higher availability of public funds dedicated to enhancing fibre-based networks

3 Progressive switch-off for copper-based infrastructure and move towards FTTH networks

4 Data demands and video content continue to growth leading to higher bandwidth and lower
latency needs (Resilience, symmetricity of Bandwidth)

5 Both incumbents and alternative ISPs shifting their core business towards FTTH

6 Municipalities/Utilities pushing to expand fibre networks in remote areas where not always
economically viable for private players

7 Fibre densification driven by 5G deployment & cost savings from fibre-5G convergence
Indicators
Historical affecting thetrends
data and growing FTTH adoption
(EU28 / EU39)
Negative impacts

1 Copper-based
Regulatory framework
enhancement
DSL & Cable
and improvements
public incentives
Society targets set for 2025)
with
to promote
new emerging
FTTH deployments
variants could(ex.
delay
Gigabit
FTTH

2 Potential risk of mobile 5G broadband technology delaying FTTH in economically non-viable

areas

3 Deployment costs are still very high for FTTH technologies (however costs are following a
downward trend YoY)

4 Non-feasible business model for isolated areas

5 Some initiatives are facing administrative barriers that are delaying fibre expansion in areas
not yet covered (right of ways)
 Methodology
Forecast study – Individual analysis of 15 European countries

Bulgaria Romania

France Russia

Germany Spain

Top 15 countries
by Homes passed Italy Sweden
as at Sept. 2018

Kazakhstan Turkey

EU39 countries
covered in FTTH Ukraine
Netherlands
Panorama

UK
Poland

Portugal
 Methodology
European FTTH/B Forecasts (2012-2025)
FTTH/B Subscribers Forecasts (million) Evolution of FTTH/B Homes Passed (million)
Comparison EU28 / EU39 Comparison EU28 / EU39

168
263
152 250
237
132 220
203
114 189
109 174
97 97 160 166
149 155
83 140 144
82 130
126
71 68 115
108 104
60 56 92
52 81
45 47 77 73
36 39 64 67
31 51 57
30
20 20 24 36
16 15 30
12
6 8

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Total EU28 Total EU39 Total EU28 Total EU39

Source: IDATE for FTTH Council EUROPE

 European FTTH/B Forecasts (2012-2025)
FTTH/B Take-up Rates Forecasts (Subs over Homes Passed, in %)
Comparison EU28 / EU39
70.0%
65.6%
2019 should be a 62.5%
turning point 63.8%
60.0%
57.1% 60.6%
52.7%
55.9%
49.0%
50.0% 51.8%
45.2%
42.0% 48.0%
44.2%
40.0% 37.4%
34.8% 40.7%
32.0%
28.9% 37.0%
28.5%
30.0%
25.7% 26.2% 33.4%
30.2%
26.4%
20.0% 24.1%
20.3% 21.3%

10.0%

0.0%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Subs / HP EU28 Subs / HP EU39

 Methodology
Top 15 Countries by FTTH/B Homes Passed in 2020 & 2025
2025 Forecasts
European ranking in terms of FTTH/B Homes passed (in million homes) EU28 : ~166m FTTH H.P.
EU39 : ~263m FTTH H.P.

% Evolution 2018 % Evolution 2018

2020 Forecasts 2025 Forecasts
/ 2020 / 2025

+2%
+6%
+33% +858%
+0.5% +81%
+11% +230%
+81% +551%
+27% +2%
+184% +86%
+12% +24%
+62% +169%
+5% +29%
+44% +112%
+4%
+9%
+40% +11%
+12% +35%
+3% +6%

Source: IDATE for FTTH Council EUROPE

 Methodology
Top 15 Countries by FTTH/B Subscribers in 2020 & 2025
European ranking in terms of FTTH/B Subscriptions (million) 2025 Forecasts
EU28 : ~109m FTTH Subs.
% Evolution 2018 EU39 : ~168m FTTH Subs. % Evolution 2018
/ 2020 2020 Forecasts 2025 Forecasts / 2025

+20% +78%
+33% +5567%
+63% +233%
+31% +92%
+47% +1006%
+90% +760%
+43% +190%
+171% +237%
+50% +82%
+67% +261%
+74% +527%
+118% +170%
+306% +96%
+48% +202%
+22% +73%

Source: IDATE for FTTH Council EUROPE

 Top 15 Countries by Household penetration
European ranking in terms of Household penetration
Subscriptions / Households (in %)
2020 Forecasts 2025 Forecasts

Portugal 90.3%
Spain 83.2%
Sweden 81.0%
United Kingdom 71.7%
Romania 70.3%
Netherlands 69.9%
France 62.6%
Russia 61.2%
Bulgaria 53.0%
Kazakhstan 42.5%
Penetration forecast in Ukraine 35.5% Penetration forecast in
2020 2025
Italy 33.2%
EU28 : 17.3% EU28 : 46.2%
EU39 : 20.4% Poland 31.6% EU39 : 44.7%
Turkey 28.2%
Germany 24.8%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Source: IDATE for FTTH Council EUROPE

 FTTH Architecture & Technology trends
FTTH / FTTB architecture
Positive FTTH evolution : Fibre closer to end-users by 2025
FTTH / FTTB architecture
FTTH/B at Sept. 2018 2020 Forecasts 2025 Forecasts
Positive FTTH evolution : Fibre closer to end-users by 2025

36.2%
44.4% 42.2%
55.6% 57.8%
63.8%

FTTH FTTB FTTH FTTB FTTH FTTB

Source: IDATE for FTTH Council EUROPE

 FTTH Architecture & Technology trends
MDU / SDU ratio
Evolution towards the delivery of individualized fibre services by 2025

MDU / SDU ratio at 2020 Forecasts 2025 Forecasts

Sept. 2018

27.9% 29.4% 32.8%

70.6% 67.2%
72.1%

MDU SDU MDU SDU MDU SDU

Source: IDATE for FTTH Council EUROPE

 Key
Keyconclusions
conclusions

1
▪ Public incentives towards fibre-based technologies will accelerate FTTH growth throughout Europe
▪ Some major private players will be migrating from copper-based and cable-based architectures to full-fibre solutions
in the coming years (e.g. BT in UK / Deutsche Telekom in Germany). Certainly, these substantial investments will be a
GROWTH key enabler of growth.

2
▪ Delayed responses by incumbents have led to increased investment in alternative FTTH operators, triggering
accelerated network builds by the incumbent (UK, Italy)
▪ More agreements to deploy FTTH services between private players, utilities companies and local authorities are
BUSINESS evolving towards a convergent portfolio where different services can be provided using the same infrastructure
EVOLUTION (telecom services, smart cities solutions and utilities)

3
▪ Based on recent announcements, 5G will be a key factor for the promotion of fibre deployments and therefore, it
will boost investments from public and private players.
▪ Evolution from previous years have showed that cable-based and copper-based ISPs have started to diversify its
TECHNO- core technologies towards fibre. Certainly, many of these players have implemented full fibre solutions and it can
SYMBIOSIS be appreciated that FTTH services are now part of its service portfolio.
Thank you for your attention!
www.ftthcouncil.eu

Roland Montagne
Principal Analyst
+33 6 80 85 04 80
r.montagne@idate.org