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Summary

The concept of using electrical distribution grids to support fiber-based communications is not new. However, Facebook asserts that its technical approach can lead to fiber deployment costs of $2–3 per meter in developing countries. This price point may be sufficiently attractive to motivate cooperation between government agencies and network infrastructure builders.

Low cost could enable attractive incentives for cooperation

Since 2017, Facebook has been working on solutions for bringing low-cost broadband connectivity to the unconnected. In its recent blog, Facebook did not reveal technical details and neither does its partner, NetEquity Networks, a San Francisco-based infrastructure-sharing startup.

The concept of using the electrical grid infrastructure to support fiber-based communications networks is not new. In 2011 and 2012, Omdia examined partnerships and trials based on the use of PON equipment to support smart grid transformation while extending broadband access to the masses.

At the infrastructure level, fiber cabling can be run alongside the electrical cabling without causing interference. In developing countries, aerial electrical grids extend to many cell-site towers and often to community centers or health clinics in villages. For an electrical-grid operator, fiber-based communications networking supports smart grid transformation, bringing the benefits of reducing outages and electrical losses in the system while identifying theft.

One key challenge to the use of electrical infrastructure for communications networks is cooperation between utility companies and network infrastructure providers, especially in large countries or across hundreds of kilometers or miles. However, cooperation is easier to achieve when there are attractive financial incentives.

Facebook's blog asserts that with its technology solution, the total fiber deployment cost could be reduced to just $2–3 per meter in developing countries. While ARPUs are low in developing countries, this cost point may support strong ROI, enabling network infrastructure providers to bypass complications associated with governmental subsidies.

It is worth watching NetEquity Networks and future Facebook partners over the next several years.

Appendix

Further reading

The Merger of China's Smart Grid and PON – A Potential Perfect Storm, TE003-000535 (December 2012)

"ZTE, Atos WorldGrid target China's smart grid opportunity; others follow," TE003-000487 (June 2011)

Author

Julie Kunstler, Principal Analyst, Service Provider Technology

[email protected]