FTTH Business Guide - AWT.be

Active network
The active network layer refers to the electronic network equipment needed to
bring the passive infrastructure alive, as well as the operational support systems
required to commercialize the fibre connectivity. The party in charge of this layer
will design, build and operate the active equipment part of the network.
Retail services
Once the passive and active layers are in place, retail services come into play. This
is the layer where the internet connectivity is packaged as a service for consumers
and businesses. Besides enabling those services technically, the company
responsible for this layer is also in charge of customer acquisition, go-to-market
strategies, and customer service. The retail service provider may also decide to
offer premium services from the content layer, such as IPTV (more in Chapter 4).
Types of FTTH organisation
Each network layer has a corresponding function. The network owner is in charge
of the first layer, although they will probably outsource its construction to a third
party. The wholesale provider owns the active equipment, while the retail
services are provided by the internet service provider (ISP). These three functions
may be found as departments within the same company, or they may be under
the control of different organisations.
In the case of a vertically integrated model, a single player will own all three layers
of the network. This is often the case for incumbent operators, like for example
Orange in France, Telefonica in Spain and Verizon in the United States. On the
other end of the spectrum, we see the fully separated ownership of the different
layers, as is the case in some parts of the Netherlands where Reggefiber controls
the passive infrastructure, BBNed runs and operates the active network and
provides wholesale access, and various retail service providers package the
broadband access with their services and sell directly to the end-users.
Here are some typical FTTH operator models:
Vertically integrated
As mentioned above, the vertically integrated model means that one operator
controls all three layers of the network, and consequently, if a second operator
wishes to also offer broadband and telephony services in the same area, he will
have to build his own infrastructure, operate it and market it directly to the endusers.
This is a clear form of infrastructural competition.
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