DSL Prime: ADSL vs. VDSL Debate Shows Power of Price

VDSL may protect the upgrade path, but ADSL remains cheaper, which is especially important in the developing world.

by Dave Burstein of DSL Prime and Future of TV [July 13, 2006]

ADSL/VDSL: When's the crossover?
By design, VDSL2 equipment can do everything ADSL2+ does, as well as offer much higher speeds on short loops only. With the price coming down as more chipmakers enter the market, many carriers will go all VDSL for operational simplicity and better performance to some customers. Rajesh Vashist of Ikanos is very encouraged, speaking of opportunities for massive VDSL deployments in Europe. KPN intends VDSL across the Netherlands, and the Telefonica billion euro order to Alcatel could be similar.

Vashist believes some telcos will build with VDSL even if that's not the service they intend to immediately sell. Carriers "around the world want the flexibility of universality. Truck rolls are a huge expense for them. They want to deploy a universal line card and a universal CPE and then upgrade the consumer as and when they subscribe to new services. The only way they can do this is with multi-mode VDSL2."

In 2000, a similar argument prevailed for ADSL (up to 6 Mbps) rather than ADSL G.Lite (up to 1.5 Mbps).

Others may not change so quickly, and not just because of the inertia of a large company. Cyrus Namazi of Conexant (who is doing well with VDSL at AT&T, Chunghwa, and PCCW) is selling 10 million lines of chips for ADSL DSLAMs a quarter, and tells me even a small difference in price is crucial to some operators.

Even if the price is irrelevant, VDSL requires more power and space than ADSL. The latest ECI M41 small DSLAM can service 128 ADSL2+ ports but only 96 VDSL2 lines, Erik Keith of Current Analysis notes. Power is a particular concern for the coming remote VDSL boxes. Many ADSL2 remotes can be powered over spare telephone lines, but VDSL needs more juice and almost always a standard electrical connection, expensive to bring to the field.

Some carriers are disappointed that the new VDSL chips don't have any performance improvements on longer loops. That was never part of the standard, however, which essentially uses regular "ADSL" beyond a certain distance.

In practice, VDSL chip vendors are happy if they connect to an ADSL modem with performance just about as good as previous. Vashist notes, "We're already connecting well in excess of 12,000 ft with ADSLx with good data rates and our multi-mode software QA checks for connectivity over the entire ADSL/ADSL2+ range, not just up to 12,000 ft." Each chip guy (they are all guys) makes claims of better rates, but none provide me with any hard data to judge which is better.

Two world class carriers tell me they plan to switch soon from ADSL to VDSL. 10 to 20 Mbps ADSL is a big improvement over what I have now, but I really want much more upstream. Asymmetry's time has passed anywhere customers have choices. The fatal flaw in DOCSIS 2.0b is the lack of upstream, while DOCSIS 3.0 (160/120 or more) could devastate telcos. 20 percent of dollar volume will be VDSL by the end of 2006, I believe, but ADSL sales will continue for years.

Corrections

• Apologies to Yochi Dreazen for the misspelling. Particularly rude to do that to a reporter.
  
  
• A Dutch reader suggests KPN network will be more likely 28,000 pedestals than the 23,000 number I reported.
  
  
• A Chinese securities analyst writes that the DSL business at Harbour was only a small fraction of their turnover, although one market researcher put them at a tenth the Chinese market a while back. He writes they are mainly focused on carrier IP networking, and some enterprise networking products.

E-mail

• "You report that outside of the Lucent/Alcatel merger, no other DSLAM vendor in North America has even 10 percent market share. What about ADTRAN?" is a very good question. They are #3 in North America, with a 9 percent market share according to the research I had handy. That's why I chose 10 percent in my example. ADTRAN, I'm well aware, has had remarkable success in the Bells. They create highly reliable products and provide exceptional support rather than marketing flamboyantly. They are a very quiet company who never reveal anything to reporters as a matter of policy, so you don't read much about them. MCI and AOL taught me that companies that stonewall the press may have a great deal to hide. I'm pretty sure in Adtran's case the reticence is conservatism, not concealment.

Copyright 2006 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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