Metro Transport and Access have mostly stayed on their respective sides of telco central offices, MSO hubs and operators' org charts.
The former interconnects operators' local network equipment buildings, while the latter connects customers to operators' networks. Traditionally, this delineation suffused the equipment market with specialist vendors like ADTRAN, Calix, Arris and Harmonic on the access side, and Ciena and Infinera on transport. Full-line vendors such as Cisco, Huawei and Nokia serve both segments, but from separate business units. Equipment for business services has been an exception, since that segment is served by both transport and access vendors, and business services tend to be a distinct silo in operators' organizations.
Today, however, the boundary between the two market segments is blurring. This is most noticeable in cable, where distributed access architecture (DAA) and fiber-deep are reshaping the access network. DAA is the next step in MSOs' broad architectural roadmap, following their recent fiber-deep deployments. Comcast completed field trials in 2018 and has started mass rollouts across their footprint. Others are not far behind.
R-PHY/MAC-PHY and vCCAP sales in 2019 will hockey stick 55% from 2018 to $233 million, and continue to grow at a 62% CAGR through 2023, based on forecasts by Jeff Heynen at S&P Global Market Intelligence.
One way to think about DAA is that it replaces composite radio frequency (RF) over optical transmission in the feeder plant with IP pseudo-wires over optical Ethernet. Similarly, fiber-deep displaces part of the coax infrastructure with fiber. The combination replaces headend RF/optical platforms and fiber nodes with an optical IP/Ethernet Converged Interconnect Network (CIN), while remote PHY (or MAC/PHY) devices (RPDs) take over amplifier and fiber node locations.
The CIN is transport vendors' entrée into MSOs' access networks. To meet the new opportunity, they have tailored their platforms for this new application and redoubled their marketing attention toward MSOs. To date, transport specialists have not tried to compete with incumbent HFC specialist vendors for the virtualized converged cable access platform (v-CCAP) or RPD segment -- although mergers or acquisitions would not surprise me.
Small cell architectures for 4G densification and 5G are another prominent example of how metro transport gear can creep into the access space. Small cells can be categorized as access nodes, comparable to RPDs and Gfast distribution point units (DPU). Centralized Radio Access Network (C-RAN) architectures repartition Physical Layer (PHY) functions by moving most digital signal processing from the cell sites (Distributed Unit, or DU) to a centralized unit (CU), for more efficient use of space and power. The trade-off is that user data must be transported in an expanded form between DU and CU. Further, each antenna requires its own high-rate bit stream, while advanced radio techniques such as beamforming and MIMO cause antennas to proliferate. On top of that, LTE-Advanced and 5G promise much higher data rates than LTE, demanding proportionally more fronthaul capacity.
Ultimately, this means each small cell must be supported by 10 Gbit/s or more of digital bandwidth over fiber. Some operators will use NG-PON2 for this purpose, as part of a converged access architecture, and presently in the domain of access vendors. Other service providers target DWDM and/or carrier Ethernet, often in ring or mesh topologies -- alternatives that live right in transport vendors' sweet spots. Carrier Ethernet is also in the wheelhouse of access vendors. Multiple alternatives for operators set up a competitive clash between industry segments.
Mobile providers are not entirely new customers for metro transport gear, but a new market for access equipment. Traditional macro-cells are more like central offices than access nodes because of their scale, low density, wide coverage areas and numbers of customers they serve. Thus, they are connected to transport networks. The significance of small cells to vendors is that they are numerous and densely dispersed, main characteristics of access and a driver for large port-count access- or transport-class aggregation nodes. As with DAA, vendors on both sides have evolved their products and marketing messages accordingly.
For now, encroachment by transport vendors does not pose an existential threat to specialist access vendors -- but it does bear watching.
— Dan Grossman is a technology-forward industry analyst and consultant, specializing in fixed broadband access technology and markets. He is Principal at NetAccess Futures, and a Contributing Analyst at Heavy Reading. NetAccess Futures offers research, analysis, strategy consulting and marketing collateral to broadband operators and equipment vendors.