Portugal Telecom. An All-Fiber Company In An All-Fiber Country. Luís Alveirinho Engineering and Network Operations.
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1 Portugal Telecom An All-Fiber Company In An All-Fiber Country Luís Alveirinho Engineering and Network Operations Portugal Telecom Montpellier, November 16 th, 2016
2 THE ROAD TO ALL-FIBER PORTUGAL: ALL-FIBER COUNTRY YE2015 PT ANNOUNCED +3M HP UNTIL ,3 3,5 5, M CAPEX >90% PENETRATION 2020 FTTH AND NETWORK STRATEGY ALIGNED WITH EC STRATEGICAL AND DIGITAL AGENDA FOR EUROPE (DAE) OBJECTIVES Universal availability at 30 Mbps 100 Mbps subscription by at least 50% of European households Internet connectivity 100 Mbps, upgradable to Gigabit speed Gigabit connectivity for all main socioeconomic drivers (schools, digitally intensive enterprises, etc)
3 PT IN THE FOREFRONT OF FTTH DEPLOYMENT > 50% > 90% 40k HP 1.0 Million HP 3.0 Million HP 5.3 Million HP Trials and pilot tests 1 st Comercial connected customer (November 2007) FTTH Council Europe s innovation prize for Deployment and Operation of FTTH Networks NGPON2 demo by Altice Labs *5.9M Total Homes in Portugal **5.3M Total Primary and Secondary Occupied Homes in Portugal
4 PT FIBER INVESTMENT MODELS IN PORTUGAL PT FIBER NETWORK STANDALONE INVESTMENTS (PRIVATE) PT FIBER NETWORK COINVESTMENT SHARING AGREEMENTS (PRIVATE) FIBER OPEN ACCESS NETWORK WHOLESALE COMMERCIAL OFFERS FOR RURAL AREAS RURAL NGA (PUBLIC) PT FIBER NETWORK WHOLESALE COMMERCIAL OFFERS (PRIVATE) FTTH/PON PT Network coverage of 5.3 MHP until 2020 Network sharing agreement between PT and VDF involving 900 khp (450 khp built by each partner) Wholesale commercial offer for passive access with splitting to Rural Networks in 50% of 136 municipalities (DST and FBG) Wholesale commercial offer for passive access with splitting to PON PT Network (+3.0 MHP until 2020) PT IS ACTIVE AND TAKES ADVANTAGE OF ALL FIBER DEVELOPMENT MODELS FOR ITS BUSINESS
5 FTTH SUCCESS FACTORS - THE DIAMOND OPPORTUNITY (D7) Innovation, R&D Developments and Partnerships Service Potential Lean and Cost Effective Deployment 03 New Business Models (3P, 4P, 5P, IoT, 5G, M2M) 06 Future-Proof Network 05 Monetizing the Fiber Investment Operational Savings 04
6 MONETIZING THE FIBER INVESTMENT FIBER NETWORK HOME 3.0M of homes passed SCHOOLS, POLICE STATIONS, More than 56% (and growing) of schools connected with fiber (GPON+Ethernet) WIFI BACKHAUL Migration to fiber in progress BUSINESS/ ENTERPRISE New low budget offers are increasing the fiber share MOBILE BACKHAUL >95% of PT cell sites already have fiber for backhauling FIBER COMMERCIAL OFFERS New fiber offers for third parties From FTTH to Fiber To Everywhere (FTTE)
7 NEW AND BETTER SERVICES 200 Mbps (100 up) 30 Mbps (3 up) 400 Mbps (100 up) Fixed Net Speed 100 Mbps (10/50/100 up) 1000 Mbps (100 up)
8 MOVING FORWARD BUT FAST VDSL AND 10GPON Leapfrog Fiber-Step II NGPON2 NGPONx Clear vision on the best technologies for the portuguese market Fiber-Step I BPON EPON GPON 10GPON NGPON2 NGPONx X Leapfrogging new copper flavours and moving fast on fiber Copper PTSN ADSL ADSL2+ X VDSL G.Fast XG-Fast Leveraging internal innovation on processes, materials and equipments
9 SERVICE PORTFOLIO AND NETWORK TRANSFORMATION Simplifying the network and Preparing the end of the Copper era REDUCTION OF 4:1 CO SITES Aggressive Fibre Rollout Plan PSTN transformation Plan Product portfolio update to an all-ip environment Network PoPs reorganization Regulatory constraints being solved Freeze on copper investment Prepare copper removal and monetization END OF GAME FOR COPPER
10 THE RESULT OF THE FTTH STRATEGY - MARKET FIGURES TV subscription service HSI subscription service Number of subscribers (thousands) Number of accesses (thousands) Market size and market share (subscribers) Cable FTTH DSL DTH Total MEO 5 4,5 4 3,5 3 2,5 Total Homes Passed in Portugal (millions) 4,8 4,1 4,1 4,2 4,2 FTTH/B 3,5 HFC (DOCSIS 3.0) 2, Market size and market share (accesses) Cable FTTH DSL LTE Total MEO 1.5M new subscribers (+70% growth) MEO market share growth from 6% to 40% Source: ANACOM 1.6M new accesses (+90% growth) MEO market share growth from 40% to 43%
11 INVESTING IN FIBER IS KEY Fiber investments are the best future-proof choice to evolve into the Gigabit Society and the chosen business and network strategy for PT Solid commitments in fiber deployment leverage innovation and increase the development of new services, materials and equipments by the industry and in-house (Altice Labs) The existing regulatory environment promotes free competition and investment on infrastructures and services
12 THANK YOU Portugal Telecom Montpellier, November 16 th, 2016
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