Golden Opportunity for Extensive 10G PON Deployment

Extensive 10G PON Deployment

Due to the significant advantage of fiber over copper as a transmission medium and the decline in fiber optic cable prices, passive optical network (PON), characterized by its fiber infrastructure, passiveness, and P2MP topology, has achieved great success over the past 15 years. As the transition from copper to optical and the acceleration of bandwidth continue to deepen, the deployment of 10G PON and the upgrade from GPON to 10G PON have become industry standards. By the end of June 2023, global 10G PON shipments had exceeded 30 million PON ports, with China’s market share accounting for approximately 80%. The extensive deployment of 10G PON in the Chinese market has significantly advanced the maturity of the 10G PON industry chain and reduced costs.

The deployment of 10G PON and the provision of gigabit services are mutually reinforcing. According to analysis data from the consulting firm Omdia, by the end of 2022, gigabit bandwidth services accounted for about 8% of fixed broadband (FBB), and this figure is expected to increase to 28% by 2026. The global deployment of 10G PON is accelerating, and it is estimated that by 2026, global 10G PON shipments will surpass those of GPON. The next three years are expected to be a prime window for 10G PON deployment.

Due to variations in population and economic development, the timing and scale of 10G PON construction may differ among regions worldwide. As 10G PON deployment gains momentum in North America and Europe, it is expected China’s market share will gradually decrease, while the Asia-Pacific and South American regions are expected to have a competitive edge in 10G PON construction.

Five Major Factors Driving Extensive 10G PON Deployment

• New service experience requirements: Operators have transitioned their construction approach from being technology-driven to experience-driven. Basic broadband services, particularly video services, now account for more than 50% of the total traffic. Platforms like Netflix, YouTube, and Tiktok contribute significantly to this surge in traffic. In the post-pandemic era, remote work, online education, and digital transformation of enterprises and industries have greatly driven the demand for increased bandwidth.
• Policy support: According to a World Bank report, every 10% increase in fixed broadband penetration is associated with a 1.38% increase in GDP growth, and each doubling of bandwidth results in a 0.3% increase in GDP growth. More than 140 countries and regions worldwide have elevated broadband network development to the level of a national strategic priority. Some have even included gigabit networks in their development plans. For example, the Chinese government proposed the “dual-gigabit dual-acceleration” plan, the European Union released the Gigabit Community Plan, the German government proposed the Gigabit Germany Plan, and the Italian government launched the 1 Giga strategy. These national policies and financial support mechanisms provide essential guidance and positive incentives.
• Competition-driven: Operators are currently engaged in fierce market competition to secure more user resources and maximize their profits. It is critical for the operators to use differentiated technologies and services to maintain a competitive edge. This includes offering attractive service packages to improve customer quality of experience (QoE) and ensure a competitive advantage.
• Network upgrade and reconstruction: As the service life of traditional PSTN, DSL, and DOCSIS network technologies and devices progresses, they no longer meet the demands of the new era. For example, some OLT devices that have been used for over a decade have reached the end of their life cycles. They cannot be upgraded or maintained to support new functionalities and performance requirements and thus necessitate an upgrade to a new device platform.
• Continuous decline in 10G PON costs: The extensive development of 10G PON is also driving continuous cost reductions. According to statistics from the consulting firm Dells’ Oro Group, the price of 10G PON ports decreased by 43% from 2018 to 2022, while the cost of 10G PON ONUs dropped by 62%, making the cost-effective deployment of 10G PON feasible. Due to the point-to-multipoint (P2MP) nature of PON, the reduction in PON device prices depends on the decrease in ONU costs.

Moreover, the higher bandwidth of 10G PON translates to faster rates and an enhanced user experience. Considering the tidal and pinpointing effects, the network must accommodate burst bandwidth needs rather than just the average bandwidth requirement. Typically, burst bandwidth can be 3–5 times that of the average bandwidth.

Four Key Principles for 10G PON Construction

• Network construction ahead of service provision: Network construction forms the foundation for service development and must be done ahead of service growth. Considering future network upgrade and evolution requirements, network construction requires early planning and a forward-looking approach.
• Step by step: Network construction is not a one-time effort but an ongoing development process. Network deployment leads the way, and customer premise equipment (CPE) is connected as needed. Throughout the construction process, multiple factors such as service development, market competition, and capital investment must be taken into account.
• Targeting high-value users with high ARPU: Network construction should foster user development and profit generation by enhancing ARPU and customer stickiness, positioning it ahead of market competition.
• Considering end-to-end bandwidth acceleration: FBB network acceleration is an end-to-end project spanning from the core layer to the bearer layer and the access layer. Any of these components may impact the effectiveness of bandwidth acceleration, including Wi-Fi and PON technology upgrades, the availability of sufficient uplink and downlink bandwidth, and the appropriate splitting ratio.

10G PON provides four times the bandwidth capacity of GPON and delivers symmetric bandwidth to cater to the requirements of high-bandwidth symmetric services, such as enterprise private lines, campus private networks, and industrial applications. In addition, 10G PON provides end-to-end gigabit access for FTTx, coupled with Wi-Fi 6/Wi-Fi 7 technologies.

Any-PON: An Excellent Choice for 10G PON Deployment

ZTE recommends adopting the pay-as-you-grow Any-PON approach for building a 10G PON network, ensuring network upgrades.

Any-PON uses different optical modules on a line card to connect different ONUs, enabling flexible on-demand deployment of both GPON and 10G PON. An Any-PON line card supports hybrid insertion of five optical module types: GPON, XG-PON, XG(S)-PON, XG-PON Combo, and XG(S)-PON Combo (Fig. 1).

There are two flexible options for deploying a 10G PON network using Any-PON.

• If there is a need for 10G PON deployment in the early stage of network construction, the direct connection of 10G PON optical modules to 10G PON ONUs is an option. Alternatively, 10G PON Combo optical modules can be used to connect both existing GPON ONUs and newly deployed 10G PON ONUs. Combo PON optical modules support the coexistence of GPON and 10G PON ONUs within the same ODN.
• In the early stage of network construction, when there is no immediate need for 10G PON services or in cases of budget constraints, an initial deployment of GPON can be considered to save on initial investments. When the opportunity arises, the upgrade to 10G PON can be made by replacing optical modules and implementing the right to use (RTU) method.

Any-PON offers the advantage of building 10G PON-ready networks with smooth evolution capability. Existing OLT chassis and line cards remain unchanged, and the deployed ODN is not affected. Any-PON can be flexibly upgraded to 10G PON to align with service development, cost reduction, and capital investment.

ZTE Leads the Way in 10G PON Deployment

As a member of ITU-T and FSAN, as well as a technical leader in the optical access field, ZTE has been firmly committed to advancing the maturity and widespread application of the 10G PON industry chain. Over the past five years, ZTE’s global 10G PON shipments have experienced a remarkable 95% compound annual growth rate (CAGR). Specifically, in 2022, 10G PON shipments increased by 130% compared with 2021. ZTE has consistently held a Top 2 position in global 10G PON market share and secured the Top 1 spot in China for 2022. Additionally, ZTE has established partnerships with over 150 operators in the 10G PON sector.

The exceptional performance in these markets is a result of sustained technological investment and strong customer collaboration. ZTE's commitment to consolidating its core capabilities and driving continuous technical innovation is evident. This includes groundbreaking industry initiatives, such as introducing the Combo PON concept , leading the industry's first commercial deployment supporting 10G PON, and offering the first 16-port XG(S)-PON/Combo PON/Any-PON line cards. ZTE consistently delivers high-quality product solutions and services to its global customers.