Investors Committee


Thomas Miller​, Chair of the Investors Committee of the FTTH Council Europe, shares his perspective on the evolution of the FTTH business in the months to come. While providing guidance to those willing to navigate their way to profitable investments in full-fibre networks, Thomas also presents the key opportunities and challenges that the committee anticipates for the industry. In this episode, our guest will answer to these questions and much more:

  1. It looks like financing fibre optics is becoming more difficult nowadays: how can investors and entrepreneurs successfully navigate their way to profitable investments? 
  2. How do you see FTTH investments in Europe evolving in the next 12 months?  
  3. What are the key opportunities and challenges that the committee anticipates for the industry, and how can these shape fibre investment strategies be moving forward?
  4. You have been serving as Committee Chair for a few years now, what do you value the most from your work at the FTTH Council Europe?

Read the full interview below to get the answers to these questions.

 

It looks like financing fibre optics is becoming more difficult nowadays: how can investors and entrepreneurs successfully navigate their way to profitable investments?
 

Of course, there are challenges. These are systemic, including persistently high interest rates, ongoing inflationary pressures, and heightened competition. Additionally, in some regions, end-users remain hesitant to transition from their existing coax or copper connections to fibre. From an investor perspective, FTTH as an asset class continues to face competition from other digital infrastructure sectors, such as data centres. As a result, investors remain cautious and are setting higher benchmarks for their requirements.

On the positive side, we are witnessing a growing number of success stories in the market. These examples demonstrate how well-managed companies with strong track records operate and highlight the business models that are thriving. They also shed light on which markets exhibit robust demand fundamentals.

Through the Investment Committee’s investment tracker, we offer a valuable tool that identifies which companies and geographies are attracting financial backing from investors. This provides clear, actionable insights, serving as an essential guide for investors navigating the FTTH landscape.

 


How do you see FTTH investments in Europe evolving in the next 12 months?

In the next 12 months, we expect FTTH investments in Europe to remain robust, driven by the increasing demand for high-speed broadband and the EU’s digital transformation goals. However, the pace of investment may moderate slightly due to tighter financing conditions and macroeconomic uncertainties. We anticipate a shift towards consolidation, with larger players acquiring smaller operators to achieve scale and efficiency. Additionally, there will be a stronger focus on rural and semi-urban areas, supported by government initiatives and funding programs like the European Digital Infrastructure Consortium (EDIC). Investors will also prioritize projects with clear revenue visibility and lower execution risks. Overall, while the market may face short-term headwinds, the long-term outlook for FTTH in Europe remains highly positive, underpinned by the continent’s commitment to achieving universal fibre coverage.


In the picture on the right, action from the Investors panel at the FTTH Conference 2024, in Berlin.

 

 

What are the key opportunities and challenges that the committee anticipates for the industry, and how can these shape fibre investment strategies moving forward?  

The key opportunities for the FTTH industry include the growing demand for gigabit connectivity, supportive regulatory frameworks, and the availability of EU funding for digital infrastructure. These factors create a favorable environment for expansion, particularly in underserved regions. However, challenges such as rising construction costs, labor shortages, and financing constraints could hinder progress. To address these, investors should adopt flexible business models, such as open-access networks, to attract multiple service providers and ensure steady revenue streams. They should also explore innovative financing solutions, including green bonds or infrastructure funds, to secure capital. Collaboration with governments and local authorities will be essential to streamline permitting processes and reduce deployment costs. By balancing these opportunities and challenges, investors can develop resilient strategies that align with Europe’s digital ambitions while delivering sustainable returns.

From an investor perspective, a critical factor is positioning investments to capitalize on the market’s significant medium-term opportunities. This includes pursuing successful acquisitions and leveraging the gradual decommissioning of copper networks, which drives a substantial increase in take-up rates for fibre. By aligning with these trends, investors can ensure their portfolios benefit from the growing demand for high-speed connectivity and the transition to next-generation infrastructure.

In the picture on the left, action from the Investors workshop at the FTTH Conference 2024, in Berlin.

 

 

You have been serving as Committee Chair for a few years now, what do you value the most from your work at the FTTH Council Europe?


The FTTH Council Europe plays a pivotal role in shaping policies, fostering collaboration, and promoting best practices across the industry. I take great pride in seeing how our collective efforts have accelerated fibre deployment, bridging the digital divide and enabling millions of Europeans to access high-speed internet. Equally rewarding is the chance to work with a diverse group of stakeholders—operators, investors, policymakers, and technology providers—who share a common vision for a connected future. Ultimately, for me, it’s all about people. Having the opportunity to meet and collaborate with so many passionate and driven professionals in the industry is a tremendous privilege. It’s these connections that truly drive progress and innovation in our field.




 

In the picture on the right, Thomas Miller is moderating the Investors panel at the FTTH Conference 2024, in Berlin.

More about Thomas Miller


 

 

Since 2006 at Hamburg Commercial Bank, Executive Director. Publisher of several studies on fiber financing. Writer and speaker for bank financing. University lecturer at Hamburg School of Business Administration and International School of Management. Head of the FttH Council Investors Forum.

 

How to half energy consumption of broadband network equipment to meet sustainability targets

Member company: Nokia
Country or geographical scope: Global
Period: 2019-2030
Company type: Vendor/Reseller
Product/service category involved: FTTP access nodes

Abstract
Investing in power-efficient network technologies can significantly reduce the carbon footprint of broadband access networks. Network operators should consider accelerating the phase-out of copper, selecting the most power-efficient network equipment, and upgrading PON networks to XGS-PON or 25G PON to increase the bits delivered per watt consumed. For this purpose, Nokia developed a new chipset that brings power savings of more than 50% in the broadband network and helps operators to meet their emissions goals with growing usage and increasing penetration of broadband.


Context

Climate change is the greatest challenge of our time and every organization has a role to play in minimising the carbon footprint of their activities. The ICT industry today accounts for more than 2% of global greenhouse gas (GHG) emissions[1], approximately the same as all air traffic. However, ICT helps consumers, businesses and other industries become more sustainable. Digitalization in general and broadband in particular contribute by cutting transportation, creating gains in productivity, and boosting economic growth for individuals, countries, cities, and society as a whole. So, despite its own carbon footprint, ICT actually carries a 7-fold net positive effect on emissions, reducing global CO2 emissions by up to 15%1. Nevertheless, network operators must continue to reduce the emissions created by their own activities.
 

Solutions

The power consumption—and hence the carbon emissions—of a broadband network is primarily dictated by the chipsets used in network equipment. Nokia has developed an optimized System-on-a-Chip (SOC) that now resides in all our network nodes. This chipset enables line cards for fibre and copper broadband with higher port densities and higher throughput per watt. In turn, this leads to smaller nodes, which occupy less space, use less power and can be passively cooled (up to operating temperatures of 65°C). When installed in street cabinets, they require less grid protection equipment, smaller power supplies and only “heatwave days” fan ventilation backup. We also have integrated energy-saving features, such as powering down unused optical modules (which is better than just switching the laser off per port, saving up to 1.5W for GPON), and improved intelligent fan tray control algorithms to reduce energy consumption and cooling when not required.

This brings power savings of more than 50% in fixed broadband networks and helps operators to meet their emissions goals. We are already shipping broadband solution with this chipset to more than 150 operators. 

The second path for operators to reduce emissions is the transition from copper to fibre broadband networks. Future-proof scalability and higher capacity make full-fibre networks the most energy efficient solution. Replacing copper-based DSL connections with full fibre-to-the-home breaks the link between bandwidth demand and power consumption. VDSL requires many more active components in the network than PON and so consumes more power. But when one also considers the far greater bandwidth of GPON compared to VDSL, the net gain is a 12-fold improvement in bits delivered per watt consumed. XGS-PON takes this even further, delivering five times the bandwidth of GPON for only twice the power consumption, with another positive impact on the energy efficiency.
 

Results

Nokia joined the Science-Based Targets (SBT) initiative and are now targeting to cut emissions by 50 percent between 2019 and 2030 across our value chain. SBT provides companies a clearly defined pathway to take action on how much and how quickly they need to reduce their greenhouse gas (GHG) emissions in line with the 1.5°C scenario.

Achieving this target requires efficiency improvements in network power consumption, continuously driving for more data bits per kilowatt of energy. As part of this commitment, Nokia and other industry players report product energy consumption according to the Code of Conducts for Broadband Communication Equipment from the European Commission. The Code sets the (maximum) electricity consumption for fixed broadband equipment sold in the EU and manufactured or procured by participating service providers, network operators, equipment and component manufacturers.

All this results in the cumulative effect of advances in technology on power consumption as shown in the graph.

The first few years of reductions are driven by the introduction of optimized, energy efficient chipsets, followed by the transition from copper to fibre. Our forecasts predict that we will be able to reach a 50% reduction from the Science-Based Targets initiative.

Note that this graph shows absolute values, and we take into account that across this decade we will deliver higher speeds to more people. XGS-PON and 25G PON will gradually overtake GPON. The blue line shows that the explosion in demand for data does not automatically lead to a massive increase in power consumption. Overall, since 2007, broadband power consumption has been reduced by 38% while speeds have increased by a factor of 64.
 

Conclusions

As broadband enables consumers and businesses to reduce their own carbon footprint, the more people connected to high-speed broadband, the better it is for the planet. Most fixed broadband operators are in the process of upgrading older copper and cable networks to deep fibre or full fibre-to-the-home networks. Accelerating these projects will accelerate the savings in power consumption and greenhouse gas emissions. Selecting the most power-efficient equipment in these network upgrades will also contribute significantly to meeting sustainability targets. Finally, successive generations of PON technology—XGS-PON and 25G PON—further improve the bits delivered per watt consumed; accelerating PON network upgrades will further enhance the sustainability of a broadband network.
 

Further reading

[Blog] Sustainability: how Nokia is helping broadband meet the 1.5°C target
[Blog] Why it’s vital to strive for Broadband Zero
[White Paper] Broadband Zero - Delivering the benefits of broadband while minimizing environmental impact
 

Contact

Filip de Greve, Product Marketing Manager, Nokia Fixed Networks
filip.de_greve@nokia.com


[1] Source: European Commission fact sheet, “Supporting the green transition”, February 2020

 

 

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