VALUE-ADDED SERVICES FOR FIBRE TO THE HOME

Market Potential, Time Horizons and User Groups

Tom Evens, Lynn De Vlieger, Elke Boudry, Pieter Verdegem, Lieven De Marez

IBBT-MICT, Dep. of Communication Sciences, Ghent University, Korte Meer 7, 9000, Gent, Belgium

Erik Vanhauwaert, Koen Casier, Jan Van Ooteghem, Sofie Verbrugge, Bart Lannoo

IBBT-IBCN, Dep. of Information Technology, Ghent University, Gaston Crommenlaan 8 (bus 201), 9050, Gent, Belgium

Keywords: Fibre to the home, Value-added services, Bandwidth requirements, Expert study, Nielsen’s Law.

Abstract: Currently, telecom operators are developing large-scale projects in the internet broadband sector in

cooperation with utility companies and public institutions. The roll-out of fibre to the home network

infrastructure is often justified by the supposed increasing user demand for high-bandwidth applications.

Starting from a user-oriented perspective, however, it is important to consider the utility of fibre networks

for future users and to explore those killer applications that can convince end-users to migrate from their

current connections to high-bandwidth networks. By means of an international expert survey, this paper

tries to identify value-added services that benefit from fibre’s network potential in terms of high speed,

symmetry and low delay. In contrast to initial expectations, video delivery applications were found less

convincing by the experts whereas health monitoring, online content storage and management services, and

desktop sharing were identified as the most promising fibre applications. In terms of timing, content storage

and management systems and desktop sharing are identified as more market-ready than health monitoring

applications. Whereas the health monitoring and desktop sharing are mainly seen as a service only for the

consumer and business market respectively, content management systems are considered useful for business

as well as for consumer purposes.

1 INTRODUCTION

Countries and cities all over the world currently are

in the process of developing large-scale projects in

the internet broadband sector. In most cases, these

initiatives are driven by public-private partnerships

(PPP), that align the interests of different private and

public players. Typical examples of private players

in such cooperation are network operators and

service providers. Public parties involved are often

local communities, municipalities and governments.

With these considerable investments in upgrading

network infrastructure, all stakeholders are eager to

provide innovative and advanced broadband services

to various user groups and tap into a new pool of

revenues (Nuccaiarelli, Sadowski and Achard,

2010). Public parties justify the roll-out and

deployment of next-generation networks (NGN) by

the desire to improve the ‘quality of place’ for

citizens and enterprises. This high-speed network

infrastructure should not only function as an

economic engine for attracting more companies and

creating new job opportunities, but is sometimes

believed to close the persistent social and digital

divides. Although this belief seems a bit techno-

optimistic and is worth a discussion (see Dolente,

Galea and Leporelli, 2010), the debate lies not

within the scope of this paper.

Another, and probably more powerful, argument

for rationalising the vast investments in large-scale

network infrastructure projects is the increasing user

demand for high-bandwidth applications. According

to Nielsen’s Law, postulated in 1998, the available

bandwidth to high end-users increases with fifty

percent per annum on average and the mass market

lags the high end-user by two-three years (Nielsen,

1998). This law predicts that 100 Mbps will be

available in 2015 and 1 Gbps in 2020. Thanks to the

increased deployment of next-generation network

infrastructure (such as fibre), a growing number of

Evens T., De Vlieger L., Boudry E., Verdegem P., De Marez L., Vanhauwaert E., Casier K., Van Ooteghem J., Verbrugge S. and Lannoo B..

VALUE-ADDED SERVICES FOR FIBRE TO THE HOME - Market Potential, Time Horizons and User Groups.

DOI: 10.5220/0003463200050013

In Proceedings of the International Conference on e-Business (ICE-B-2011), pages 5-13

ISBN: 978-989-8425-70-6

 2011 SCITEPRESS (Science and Technology Publications, Lda.)

countries are already providing services to the

residential market with a bandwidth higher than

anticipated by this law (albeit on a small scale). In

Sweden, for example, 100 Mbps connections are

available since 2004 in several areas of the country.

Given the extensive residential fibre deployment and

the growing rivalry among internet service providers

(ISPs) in terms of pricing and capacity, Sweden is

expected to pass the 1 Gbps milestone already in the

near future (Ventura Team LLP, 2008).

In 1964, McLuhan stated that ‘the medium is the

message’ by which he meant that content is defined

by the nature of its distribution mode. Following the

rationale behind this phrase, the availability of high-

bandwidth capacity should thus eventually result in

the supply and consumption of bandwidth-intensive

services and applications. However, it may be clear

from the past that end-users are only willing to adopt

new technology if this provides them with perceived

added value and benefits (the so-called chicken-and-

egg problem). With regard to fibre networks, Noam

(2008: 2) notes that ‘it is common to rush into talk of

technology or rollout strategy without first

considering the utility to users. If one builds an oil

pipe one must first be sure that there is an oil supply

at one end and demand for it at the other. The

economic case for investment in super-broadband

must rest on its meeting a demand/price combination

that is not satisfied today’. Especially in Europe, this

demand for fibre networks is still mainly unproven.

Whether the network operators’ goal is to migrate

existing DSL (or cable) customers to fibre or to

position fibre as a superfast high-end offer, fibre

technology is not yet a widespread success in

Europe (IDATE, 2010). In general, the number of

homes passed is still small and commercially

available offers have not yet fully convinced

potential customers, which seem satisfied with their

existing connection, to migrate to fibre. Although

prices for superfast broadband access are in line with

or slightly higher than those charged for regular

access, end-users are reluctant to switch to NGN

providing more bandwidth capacity these days. If

the perceived utility for end-users is not in access

prices, the supply of value-added services will

certainly have to provide this utility.

In this paper the focus is on the supply and

demand for bandwidth-intensive applications.

Following a user-oriented approach – instead of the

more technological deterministic perspective – the

paper tries to identify those services that offer added

value and that benefit from fibre networks’ potential

in terms of high speed, symmetry, low delay and low

jitter. Based on opinions of 21 international experts,

this paper explores business opportunities for a

limited set of services and applications, which might

help in convincing end-users to switch from regular

to ultra-broadband internet connections. In order to

be sure that these services need NGN (in this case

fibre), it is questioned whether or not existing

infrastructure will suffice to deliver these

applications with similar ‘quality of service’ (QoS)

and ‘quality of experience' (QoE)(De Moor & De

Marez, 2008) .

2 DO WE REALLY NEED FIBRE?

‘If you build it, they will come’. This ‘adage’ is often

heard when talking about an innovative product or

service. It implies that supply automatically evokes

demand and that each innovation finds its way to the

end-user. As this reasoning merely is an illustration

of technological-deterministic approach, it does not

provide sufficient arguments to convince operators

to invest into expensive infrastructure in the short

term. Currently, there is a lot of debate among

experts whether fibre’s bandwidth is excessive for

services’ requirements and whether existing network

infrastructure would suffice to offer ultra-broadband

applications. Hence, this section provides a brief

overview of this debate – including some of the

arguments held by fibre advocates and opponents –

but also aims at going beyond this mainly theoretical

discussion by offering technical application

requirements and more quantitative argumentation

of why fibre is an appropriate solution for realising

value-added services.

2.1 Fibre Deployment

Whereas previously Digital Subscriber Line (DSL)

and Hybrid Fibre Coax (HFC) were among the most

prominent technologies to provide homes and multi-

dwelling buildings with access to

telecommunications services, fibre is increasingly

used to deliver signals from the operators’ switching

equipment to houses or offices. ‘Fibre’ is the generic

term for any broadband network architecture that

uses optical fibre to replace all or part of the existing

metal local loop used for last mile internet

communications. With regard to the distance

between the optical fibre and the connected end-user

(the shorter this distance, the faster the connection),

distinct configurations can be distinguished (see also

figure 1):

 Fibre to the node (FTTN): fibre is terminated

ICE-B 2011 - International Conference on e-Business

in a street cabinet up to 300 meter from the

average end-user while the final last mile is

connected by alternative distribution methods

(wireless, copper, coax)

 Fibre-to-the-curb (FTTC): fibre is terminated

in a street cabinet closer than 300 meter from

the average end-user

 Fibre-to-the-building (FTTB): fibre terminates

at the boundary of the building, the in-house

connection continues over alternative in-

building technologies

 Fibre to the home (FTTH): fibre continues

indoors and reaches the living and working

spaces

Figure 1: Fibre network configurations.

Compared to traditional infrastructure, the most

obvious benefit optical fibre provides is speed. Fibre

networks carry data by transmitting pulses of light,

usually created by lasers, which turn these light

signals on and off very quick. As these lasers are

getting ever faster, higher speed data transmission is

possible via the same network without the need to

replace the fibre. Additionally, in contrast to other

existing network media, the optical fibre is a

medium with very low attenuation and dispersion of

the signal. This allows optical networks to carry

much higher bandwidths over longer distances with

less loss and deformation of the signal (and content

as such). Traditional upgraded network

infrastructure (e.g. VDSL, DOCSIS) offers more

problems for increasing bandwidths and current

implementations typically ranging from 3 to 30

Mbps downstream and from 0.25 and 4.5 Mbps

upstream capacity. Currently fibre offers

downstream and upstream bandwidth of 100 Mbps

even up to even 1 Gbps on the residential market.

Business customers are often provided with much

higher bandwidths over the same fibre. Along with

speed, symmetry – identical downstream and

upstream bandwidth – is an important fibre benefit.

The combination of speed and symmetry allows for

low latency and as a result improved interactivity.

Finally, fibre networks allow for a more reliable and

consistent signal. As fibre is almost immune to

electromagnetic interference and eavesdropping, its

connection is perceived more stable than traditional

network infrastructure. From a user perspective, this

ultra-broadband network infrastructure should result

in enhanced services and an increased QoE.

However, a small amount of authors believes

that existing network infrastructure will suffice to

deliver enhanced applications and services to end-

users in the future. Fredebeul-Krein & Knoben

(2010), for example, argue that research shows

limited evidence for increasing demand for high-

bandwidth capacity and that people are rather

reluctant to pay a price premium for fibre

connections. In addition, telecom operators are

facing regulatory uncertainty regarding future

wholesale (i.e. will first movers be forced to open up

their network to alternative access-seeking

operators?), while technical progress may allow the

current networks to deliver higher bandwidth. They

claim that for telecom operators there are no obvious

guarantees for a viable business case (Fredebeul-

Krein & Steingröver, 2009). Noam (2008) also

questions the viability of high-bandwidth content

providers, which would have to invest heavily to

develop innovative services without any guarantees

considering return on investment.

This view is largely disproved by true broadband

believers, who consider current networks incapable

of meeting future bandwidth requirements, even if

network operators would strongly invest to improve

existing infrastructure. According to Huigen & Cave

(2008: 714), ‘the question is not so much whether a

massive increase in bandwidth over fixed access

networks is necessary, but rather when and how it

will be realised’. As the majority of applications

demanding high-bandwidth is still to be developed,

fibre is often said to be the most ‘future-proof’

technology. Referring to the traditional chicken-and-

egg problem new platforms face, it is important to

note that the availability of high-capacity services

necessitates improved network infrastructure, while

investments in upgrading networks may stimulate

the development of capacity-sensitive applications

VALUE-ADDED SERVICES FOR FIBRE TO THE HOME - Market Potential, Time Horizons and User Groups

(Falch & Henten, 2010). This might mean that cities

and countries can benefit from an ‘accumulation

effect’. The more homes and buildings are passed

with fibre, the higher penetration rates will be and

the more novel applications will be developed. In

this regard, the development and provision of

services will benefit from economies of scale, both

on the supply and the demand side.

2.2 Application Requirements

In order to evaluate the technical requirements for

ultra-broadband applications with regard to existing

and next-generation networks, one has to consider

some properties of online communication networks

(Comer, 2009). The best-known network parameter

is the provided bandwidth, which defines the amount

of information sent over the network (expressed in

bits/second). A distinction should be made between

download and upload capacity, and between average

and peak bit rates that are processed over a digital

communication network. In terms of bandwidth,

video applications obviously require more capacity

to send over a network compared to text files. While

it takes about 5Mb to share PDF e-books, sharing

full-length high-definition quality movies requires

up to several Gbs. Depending on its duration and

quality level, high-definition video such as internet-

protocol television (IPTV) services require about

12.5 to 20 Mbps (see Charbonnier et al., 2008). For

this reason, video-related applications should

definitely benefit from increased bandwidth of next-

generation networks such as fibre to the home.

Apart from bandwidth, delay and jitter are also

important design and performance characteristics of

a telecommunications network. Delay specifies the

time needed for a bit to travel from one node to the

other (typically measured in fractions of seconds)

while jitter refers to the variance in this delay. These

parameters are only critical in case of bi-directional

and real-time applications such as video telephony

and streaming. A smooth conversation requires that

one hears the other with a delay of less than 100ms.

Jitter is even more important than delay and can

cause severe quality degradations, and is often

solved by providing a buffer at the receiving end

with a given average fill rate. These buffers however

will also result in additional delay.

Table 1: Next-generation network quality parameters.

Service class Delay Jitter

Real time < 5ms < 1ms

Streaming < 40ms < 10ms

Transactional < 100ms N.A.

This overview of critical network parameters

allows us to indicate the technical requirements for

fibre-networked applications and to identify value-

added services with market potential. In Table 1, the

NGN quality parameters (in this case delay and

jitter) are summarized. It is obvious that bandwidth-

intensive applications relying on real time, streaming

or/and transactional functionalities will capture the

full benefits of fibre networks.

Table 2: Bandwidth requirements for end-user services

(minimum case, in Mbps); (Charbonnier et al., 2008).

Service 2010 2020 2030

Voice 0.15 0.15 0.15

Video telephony 0.5-2 4 10

High speed gaming 0.25-2 4 60

Video on demand 1-3 20 200

Cloud computing 2-2.5 18 150

Live streaming 4-10 12.5 160

IPTV channel 4-10 12.5 160

IPTV zapping 5-15 15 208

In terms of end-users services, Table 2 provides

an overview of the current and future requirements

for broadband services as estimated in the OASE

project. It becomes clear that current networks with

limited bandwidth will hardly suffice for these future

services’ requirements taking into account

technological developments (e.g. the expected shift

towards super high-definition and for some purposes

3D quality). In the case of video telephony (think of

video conferencing and e-learning platforms), there

should ideally be a two-way path high-quality video

stream. Additional information (such as documents)

can be shared as well, but as previously mentioned,

the latter have considerably lower impact on

bandwidth requirements. The current required

impact for video telephony is estimated at 2 Mbps

mounting up to 4 to 10 Mbps (both for upload and

download) in the next decades. In addition, video

telephony is very sensitive to delay and jitter.

Considering a video surveillance application, delay

and jitter will be less of a problem. A number of

cameras (both in-house and out-house) could send

high-quality video to a central server

simultaneously, where the data stream is analysed

and suspicious activity triggers an alarm. Assuming

six cameras (ca. 12.5Mbps per stream) to cover all

relevant areas inside and around homes and offices,

an upload capacity of 75 Mbps is required. Another

promising application is IPTV (digital TV),

requiring 12.5 Mbps for each channel being watched

or recorded (though in practice this can increase up

to 20 Mbps). This requirement may mount up to 600

Mbps with ultra-high definition (UHD, Super Hi-

ICE-B 2011 - International Conference on e-Business

Vision) and 3D quality in the future. Finally, online

back-up and content management systems could

create added value to the end-user. By using cloud

computing, media files created by the user can be

safeguarded online instead of stored on a local space

(requiring tens of gigabytes). As delay is less

important for this service, network bandwidth is an

important bottleneck. Unlike other applications, the

bandwidth use of this application is less continuous,

but occurs in burst in sync with the user’s activity.

For example, after shooting, a photographer wants to

upload 400 high-quality photos (about 2 Gb). At an

upload speed of 5 Mbps, it takes close to one hour

while it takes about ten minutes at a speed of 25

Mbps. As the user wants to browse his pictures after

uploading, it takes two seconds to load each photo,

which feels very slow and unresponsive. To reach a

response time lower than half a second, a download

speed of 100 Mbps is required, and bandwidths of

500 Mbps or above can give the user an

instantaneous feeling of the application for viewing

his photographs.

2.3 Existing vs. Next-gen Solutions

The first mentioned discussion on fibre deployment

could lead to the conclusion that existing network

infrastructure should suffice to deliver some of the

aforementioned services to end-users with a more or

less optimal QoS and QoE. However, this discussion

on bandwidth-intensive applications and the related

technical requirements may be quite artificial. In real

life, these applications will be used simultaneously

within a family context. Assume a family household

of four members where the father watches a

particular television channel on the regular screen

(while recording another one via the set-top box),

and the son is viewing a football game via his tablet-

pc. At the same time, the daughter is safeguarding

her pictures online while the mother is making a

video call with her sister living abroad. In this

imaginary case, a download bit rate of over 50 Mbps

is required (100+ is recommended) whereas the

upload speed would have to be 17.5 Mbps (30+ is

recommended) to guarantee an optimal QoS and

QoE. Not to mention that some of these applications

are sensitive to delay and jitter, which the users will

experience in case the network is working at (close

to) full capacity.

As delay and jitter in the network are not only

determined by the access technology, but also by

several elements in the network infrastructure, they

have not been quantified within this study. Still,

every buffer that has a faster connection (i.e. fibre)

can contribute to a lower delay. Similarly, jitter is

only expected to increase by fibre solutions when

the newly provided applications seem so popular

that the relative load on the network is increased

significantly. Hence, the rest of this section will

focus on bandwidth.

There is currently no large-scale fibre to the

home network deployed in the Belgian market. The

major players that dominate the market (Belgacom

and Telenet) are experimenting with FTTH pilots,

but no roll-out is planned to date. Regarding

bandwidth, Table 3 – showing a typical and high-

end service – indicates that the existing

infrastructure in Belgium (as well as in many other

countries) may prove insufficient to deliver the

services discussed in this paper. It should be noted

that in the Telenet case video is broadcast in a

separate RF-channel not impacting downstream or

upstream traffic. Additionally, it is necessary to note

that the up- and downstream bandwidth is shared

amongst all customers of the same coax line. In the

Belgacom case, the bandwidth is dedicated per

customer, but is used for both internet and video.

Table 3: Bandwidth of Belgian ISPs (bandwidth capacity

in Mbps, prices in Euros).

Telenet (cable) Belgacom (xDSL)

Normal High Normal High

Down 15 100 12 30

Up 1 5 1.5 4.5

Price 30 99 33 58

The overview shows that the upgraded network

infrastructure (DOCSIS 3.0 and VDSL for Telenet

and Belgacom respectively) hardly guarantees the

optimal QoS and QoE for high-bandwidth services.

While the download speed of the high-end solution

of Telenet could suffice, the upload speed – just like

the other solutions – fails to meet future bandwidth

requirements. Since end-users attach great value to

file-sharing and user-generated content, applications

increasingly require symmetrical bandwidth (Cave

& Martin, 2010). It should be mentioned that these

offers are theoretical values. Telenet states on its

website that measurements indicate that realistic

speeds of both Telenet and Belgacom connections

are about 75 percent of the bandwidths officially

indicated. The lack of fibre to the home solutions in

Belgium heavily contrasts with the 100 Mbps

solutions offered in several other countries and parts

of the world (in terms of penetration, Asia is the

undisputable forerunner in deploying FTTH

services) (see IDATE, 2010). The Belgian demand

for, and large-scale roll-out of fibre to the home

remains to date mere speculation. This is perhaps not

VALUE-ADDED SERVICES FOR FIBRE TO THE HOME - Market Potential, Time Horizons and User Groups

because of limited demand and willingness to pay

and demand, but has much to do with the existing

duopoly in the broadband market. This dominance

may depress investments in network optimization

and at the same time hamper entrance of alternative

operators, who are likely to reduce investments and

seek access to the incumbents’ improved networks.

Table 4: FTTH bandwidth offerings.

Country Down (Mbps) Up (Mbps)

the Netherlands 50 50

Sweden 1000 100

France 100 100

Portugal 200 20

United States 50 20

Japan 100 100

Korea 100 100

3 RESEARCH METHOD

The results are based on the interdisciplinary

TERRAIN project (Techno-Economic Research for

futuRe Access Infrastructure Networks), which

focuses on a better cooperation between all public

and private actors that are involved to optimize the

roll-out of new telecom and utility networks, and to

align the operational processes in a more consistent

way. All aspects will be analysed from a techno-

economic point of view, considering the technical,

regulatory, economic and user-related sub-problems.

In the remaining part of this paper, the focus will be

on user studies.

In essence, the user studies within the project

aim at identifying which applications and services

have the potential to drive future adoption of fibre to

the home networks, and which of these applications

are fully appropriate to reap the fruits of superfast

and high-bandwidth network infrastructure. As the

focus of our first efforts was on exploring business

opportunities, the primary goal of this study was to

draw up and evaluate a long list of high-bandwidth

and fibre-sensitive applications (use cases). This has

resulted in valuable input for the next stages of the

project including a large-scale end-user survey both

to residential and business customers.

Figure 2: Research design.

Based on existing projects combined with

literature research, a brainstorm session was

organised to generate ideas for high-bandwidth

applications. As a result, a long list of likely services

was drawn up. This list was further discussed and

refined in an interdisciplinary workshop with project

partners. Eventually, a shortlist consisting of ten use

cases was drafted:

 Surveillance cameras

 Virtual classrooms

 Health monitoring system

 Online multiplayer gaming

 Content storage and management

 Future Internet-protocol television (UHDTV

and 3D)

 Video telephony

 Desktop sharing

 On-demand video streaming

 Immersive 3D tourist environment

To get a better picture of genuine drivers and use

cases for FTTH solutions, it was deemed essential to

take expert views and opinions into account.

Therefore, a qualitative survey among international

experts on fibre services and roll-outs was

organised. A panel of international experts was

derived from literature and personal contacts. All

project partners were also invited to join the panel.

All experts were sent a personal e-mail in which

they were asked to complete an online questionnaire.

In this questionnaire, the experts were asked about

each service’s likelihood, time horizons (in terms of

technological feasibility, and reach of mass market)

and most likely end-user groups.

A total of 21 experts completed the survey. Some

53 percent of respondents is working in public sector

(especially research institutions) while the rest of the

experts are mainly in the employ of equipment

vendors and telecom operators. Most of them have a

rather technical background, but a considerable part

also indicated expertise in regulatory issues, content

& applications and business models. In total, people

from 8 countries participated in the expert survey.

4 RESULTS

4.1 Overall Use Case Popularity

In the survey, the experts were asked to choose their

personal three most convincing services and to rank

them subsequently. Based on their ranking, use cases

were given five (ranked first), three (ranked second)

and one (ranked third) point(s). These points were

ICE-B 2011 - International Conference on e-Business

then summed resulting in a total score. Rather than

the absolute scores for each application, the relative

position of each service is more interesting.

Table 5: Ranking of applications.

Rank Use case Score #1

1 Health monitoring system 18 3

2 Content storage/management 16 3

2 Desktop sharing 16 1

4 Virtual classroom 15 1

5 Online multiplayer gaming 14 2

6 Video telephony 11 2

6 Surveillance cameras 11 1

8 Internet-protocol television 6 0

8 On-demand video streaming 6 0

10 3D tourism environment 0 0

The resulting ranking brings to light some very

interesting and perhaps unexpected conclusions.

Health monitoring systems and online content

management are clearly deemed most convincing,

considering their high score and the fact that three

experts rated them most convincing of all

applications. The top three is completed by desktop

sharing, beating an e-learning application and online

multiplayer gaming. Without labelling these services

as ‘killer applications’, they should be at least

considered by service providers when rolling out

fibre network infrastructure. These findings are

somehow surprising since all the traditional video

delivery applications – which were expected to

benefit from fibre’s high-bandwidth capacity – were

found less convincing by the experts.

4.2 Time Horizons

In other parts of the survey, experts were asked

about the time horizon along which the different use

cases are expected to be available from a technical

point of view and when they will reach mass market

(i.e. be adopted by the early majority segments).

With this, the study aimed to gather expert forecasts

of the development and breakthrough of these

services.

With regard to the underlying technology of the use

cases, experts consider that most of the applications

can be launched at this moment or within two years

except for 3D internet-protocol television (Figure 3).

None of the applications’ underlying technology is

said to be infeasible. Four use cases were found

market-ready, amongst other content management

and desktop sharing systems, respectively ranked as

number two and three in the former ‘killer

application’ ranking. Surprisingly, health monitoring

systems – identified as the most promising service –

Figure 3: Time to technological feasibility.

were seen as less market-ready. Future television is

considered the least plausible use case as the

minority of experts indicated the current readiness of

technology. These findings may suggest that

technology will not be the main barrier for the

deployment of high-bandwidth applications. Experts

confirm that most applications can be brought to

market within two years; only the future television

services are considered to be more long-term.

Regarding market acceptance and penetration, it

is remarkable that the three most technologically

feasible services (i.e. content management, desktop

sharing and on-demand video streaming) should be

able to reach mass market already today, although

the time horizon for user adoption is less positive

compared to its technological feasibility. According

to the experts, technology is expected to come ahead

of the market (Figure 4). While about 50 percent of

the experts think that health monitoring systems are

market-ready, only 25 percent estimates that there is

a market for such a service at this moment. Hence, a

time lag is expected between the actual possibility to

enable an application from a technological stance

and the time needed to reach critical mass (about 15

percent of the market). Generally, the time lag seems

bigger for less popular use cases than for the most

likely services – albeit that a considerable part of the

experts expect health monitoring systems no sooner

than within ten years.

Figure 4: Time to mass market.

VALUE-ADDED SERVICES FOR FIBRE TO THE HOME - Market Potential, Time Horizons and User Groups

4.3 End-user Groups

After identifying promising services that are feasible

from a technological as well as from a market-

oriented perspective, experts were asked whether

they believe an application is primarily a B2B or

B2C scenario or both. Evidently, service providers

are eager to offer services with market potential that

can be used both for business and consumer

purposes. In this context, applications identified as

most promising are scoring rather well.

Figure 5: End-user groups.

Figure 5 clearly shows that content management

applications and surveillance cameras are considered

appropriate for business as well as for consumer use.

Health monitoring, online gaming, internet-protocol

television and on-demand video streaming are seen

as applications almost only relevant for consumer

markets. In contrast, video telephony and desktop

sharing are identified as business applications. Apart

from this analysis, most use cases can be utilised by

private as well as business end-users, which holds

prospects in the light of the further development of

these applications. As the development of these

services will be subject to economies of scale on the

supply and demand side, a larger sales potential

should eventually lead to a cheaper and even faster

development process.

5 CONCLUSIONS

In this paper, the focus was on the identification of

applications that can generate added value to fibre

networks and that can convince internet users to

migrate from their existing connection to high-

performance broadband networks. Since new

technology is often developed and deployed without

even knowing user requirements, a user-oriented

approach was used in this project. In contrast to the

belief that demand follows supply, a user-oriented

approach allows to identify what future users want,

whether they are willing to pay for these services

and when these services will be able to reach critical

mass. As almost everything is possible from a

technological perspective, service adoption is often

slowed down by regulatory issues (e.g. privacy),

unviable business models or products that fail to

meet user requirements (pricing, features, added

value, etc.). Hence, a plea is made for more

interdisciplinary research on information technology

looking beyond technical aspects but also taking into

account economic, legal and social dimensions of

new ICT applications.

The outcome of such a user-oriented approach is

sometimes surprising since it may tackle taken-for-

granted beliefs and provide refreshing insights that

let arise new perspectives and inspiring solutions to

old problems. Regarding fibre services, the literature

– which is scarce – indicates video-based services as

killer applications to fully benefit from fibre’s higher

bandwidth and speed. However, according to the

experts consulted, high-quality video hardly seems

convincing for end-users to switch to next-

generation networks. Instead, health monitoring,

content management and desktop sharing are

identified as the most convincing use cases for

connecting to fibre networks. In terms of time

horizons, however, health monitoring lags behind as

experts think its underlying technology is currently

not ready while critical mass is expected within two

years or at the earliest.

The findings should be considered explorative as

they are only based on the views and opinions of 21

international experts. However, the results indicate

which services are identified as value-added services

and which create business opportunities for service

providers. Thereby, the results provide valuable

information for next research steps, including the

construction of an end-user survey (both residential

and business). Afterwards, it will be interesting to

verify whether expert views correspond with end-

user requirements and whether the most promising

services will prove convincing to end-users.

ACKNOWLEDGEMENTS

This research was carried out as part of the IBBT

TERRAIN project (2010-2012). This project is co-

funded by IBBT, IWT and Acreo AB, Alcatel-

Lucent, Comsof, Deutsche Telekom Laboratories,

Digipolis, FTTH Council Europe, Geosparc, Stad

Gent, TMVW, TE Connectivity, UNET and WCS

Benelux BV.

ICE-B 2011 - International Conference on e-Business

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VALUE-ADDED SERVICES FOR FIBRE TO THE HOME - Market Potential, Time Horizons and User Groups