Broadband access is rapidly changing the way we live, work, and play. Due to the impact of COVID-19, 2021 witnessed record uptake in many digital services and applications. Although in most countries and territories restrictions have now eased, the impact of the pandemic will continue to stretch far beyond the initial health and social crisis, with industry trends and people’s behavior undergoing a long-term change.
Figure 1 (page 2) shows that the use of video-based services in particular has grown, not just limited to entertainment applications. Also, 51% of respondents to Omdia’s Digital Consumer Insights survey stated that their use of video calling had increased in 2021, with 18% noting the change as significant.
A rapid rise in home working was one driver of the increase in video-conferencing, and even though most places of work are now fully open, many workers have continued to work from home, at least on an occasional basis. In a survey by PwC of over 52,000 workers across 44 countries and territories (PwC’s Global Workforce Hopes and Fears Survey 2022), 26% of respondents stated that they would prefer to continue to work from home full time; however, only 18% noted that their employer would expect this. On the flip side, only 11% of workers said that they would prefer to work full time in the office, with a greater 18% stating that this is likely to be their employer’s preference. Therefore, hybrid working is likely to be the compromise made by many employers, making home working IT solutions a key growth segment moving forward.
It is not just residential users that are increasingly turning to online applications. It is imperative that enterprises of all types digitize their operations to remain relevant to their customer base and drive greater efficiency—and this means an ever-increasing reliance on fast, reliable broadband access services. In a survey of just under 100 enterprise executives, over 55% of respondents stated that their businesses now required faster broadband access to meet the needs of their customers, run business applications, and remain competitive in general. Also, 38% noted that they have employees who also need to gain access to business broadband services (see Figure 2).
Figure 1 : Reliance on digital applications continues to grow
Figure 2 : Enterprises require faster and faster broadband to run their business applications
Broadband investment is a key driver of country growth and development. Although complex to fully quantify, the importance of broadband connectivity in socioeconomic development is undeniable. The global broadband subscription market alone was worth over $356bn at the end of 2021 and supports a wider ICT industry that typically accounts for between 2% and 7% of a country’s overall GDP.
The benefits of broadband, however, spread far beyond those that can be directly monetized. For example, a study by the World Bank concluded that the chance of an educated population finding a job increases by 7–13% when it has access to fiber-optic infrastructure. Additionally, broadband networks are used to support a vast range of industries, from manufacturing to health institutions to educational facilities, as well as supporting more social aspects such as well-being and social equality.
Governments around the world now recognize the importance of broadband at a country level, with the majority setting out national broadband plans to drive greater connectivity penetration. To some extent, such efforts are working, with the global unconnected population dropping from 45% in 2019 to 27% by 2026. However, 30% of that connected population by 2026 will still only be connected via mobile access.
Mobile broadband connectivity can bring quick and significant economic impact in emerging economies, but as modeled by the ITU in its report How broadband, digitization and ICT regulation impact the global economy, this impact reduces due to diminishing returns as penetration increases. In contrast, the level of benefit increased in line with fixed-broadband penetration. Moreover, the greater the broadband maturity of a country, the more capable it is of increasing product digitization and further driving its economic impact (see Figure 3). It is imperative, therefore, that countries do not push simply for 100% connectivity but 100% fixed-broadband connectivity.
However, 100% fixed-broadband penetration is not the end goal. With broadband, the quality of a connection is just as important as the connection itself. Unlike other utility services such as gas and electricity, the quality of broadband network is important, as higher-speed, lower-latency networks can support a greater number of more sophisticated, cloud-based applications. This wider, more advanced set of internet applications can help further drive a country’s wealth and overall efficiency.
The future digital divide, therefore, should not be measured by the level of connectivity, but by the level of high-speed fixed-broadband connectivity. By this measure, though, the divide is only growing bigger—not smaller.
Figure 3 : Economic contribution of mobile versus fixed broadband
Figure 4 shows the global population by region and how they will be connected by 2026. The chart shows that most regions other than Africa will have reached well over 50% connectivity penetration by 2026. However, in developed areas such as North America and Oceania, Eastern & South-Eastern Asia, this connectivity is almost all fixed broadband, and significant portions of the population receive high-speed broadband connections of over 500Mbps. In less-developed regions, however, the availability of such high-speed broadband access is still small. If such regions don’t catch up quickly, then they will be left at a serious disadvantage—especially as the world moves to applications like XR and the metaverse.
Figure 4 : Percentage of connected population, by fixed-broadband speed, by region, 2026
As discussed in the Fiber Development Index Analysis: 2021 report, end-to-end optical-fiber networks outperform all other broadband technologies on all QoS metrics, including superior network consistency properties, thus ultimately providing the best quality of experience (QoE) to the customer.
In this report, we highlight the results of the most recent broadband QoE metric report, UK Home Broadband Performance, from the UK telecommunications regulator, Ofcom. In this report, data shows that although at the time of measurement, the UK cable broadband operators were offering higher top-download speeds than the newer FTTH operators, the average speeds over the cable network could vary considerably depending on the time of day and congestion on the network. In comparison, speeds across fiber networks remained highly consistent (Figure 5).
Ofcom’s report also highlights fiber networks’ low-latency characteristics. Figure 6 shows that regardless of speed, the fiber-based offerings consistently offer lower latency than services provided over other broadband access networks.
As well as delivering a superior QoS experience, full-fiber networks have several other network benefits that operators must consider when developing fiber investment business models. Compared to copper-based networks, full-fiber infrastructure is newer, made of highly resilient material, and is more passive. These features mean that full-fiber networks need far less maintenance, and as they don’t require as much active equipment in the field to power them, their energy consumption is lower, and there is less need for field maintenance.
In addition, as optical-fiber cabling offers significantly higher bandwidth capacity at a fraction of the size and weight of copper wiring, it uses far less cabling and fewer racks and switches than copper-based networks—saving both physical space and money. Finally, the smaller size of the optical cables makes it possible to deploy using a technique known as “micro-trenching,” which is cheaper, quicker, and less environmentally destructive than traditional telecom network trenches.
Figure 5 : Fiber provides the most consistent download speed
Figure 6 : Full-fiber networks offer lower latency
The green agenda has become an important topic for national governments and private enterprises. Many broadband service providers have already adopted environmental elements to their list of corporate values. Moving to a 100% fiber-optical network can also help with such initiatives, as fiber has several inherent properties that make it more environmentally friendly compared to copper-based networks.
Full-fiber networks require much less active equipment in the field to power them, significantly reducing energy consumption. An optical distribution network (ODN) requires zero electrical power. In addition, due to fiber’s significantly higher bandwidth capacity at a fraction of the size and weight of copper wiring, it requires significantly less power per bit. Typically, according to equipment vendor Huawei, for every 10,000 access connections that evolve from copper access to a FTTH Gigabit Passive Optical Network (GPON), the operator saves over 1,500kWhs of power.
In 2019, Telefónica (Spain) stated that its FTTH network was 85% more energy efficient than its old copper infrastructure. Over three years, the operator said its FTTH initiative had saved 208GWh, representing a reduction of 56,500 tons in CO2 emissions. In Belgium, incumbent telco Proximus noted that data transmission over its fiber network uses up to 12 times less energy than on its copper network. A large part of this energy saving is down to the significant reduction in the number of street cabinets, as well as the reduction in size of the remaining ones.
A study launched in 2017 by Europacable, a European organization representing wire and cable producers, concluded that fiber is 64% more energy efficient than hybrid fiber-coaxial (HFC) cable technology. It found that performing at 50Mbps, fiber networks consume 56kWh per capita per year compared to 88kWh for DOCSIS.
Due to its superior network qualities, the move to advanced fiber networks can also bring indirect environmental benefits by reducing commuting trips because of video conferencing and home working. Openreach in the UK, for example, estimated that moving to a full-fiber network would enable 230 million fewer commuting trips per year—equivalent to 700,000 tones of saved carbon.
