The corona crisis in particular has thrown this into sharp relief. I don’t think it is any exaggeration to say that, during the numerous lockdowns, the weight of the world weighed heavily on the shoulders of the global telecommunications networks.
«In the modern world, digital connectivity makes a significant contribution to GDP. Digital opportunities allow companies to reach new markets, increase efficiency and continuously improve customer interaction.»
For many years now, Switzerland has continued to top the various international rankings for broadband provision. This is due to the extremely dynamic competition within the telecommunications network infrastructure sector – with around 200 strong network operators in a small and topologically challenging country, including national providers such as Swisscom and cable network operators as well as regional companies with their own cable and fibre networks. Switzerland’s per capita investment volume in IT and networks is therefore the highest in the world. (Source: ITU study, Measuring the Information Society Report) With an annual investment volume of around CHF 1.6 billion, Swisscom alone (whose net revenue in Switzerland was over CHF 8.5 billion in 2019 for example) is responsible for around 2/3 of total investments in the Swiss IT and network infrastructur.
This high level of investment is clearly reflected in Switzerland’s ranking in an international comparison of high-performance networks:
«Switzerland has exceeded the targets of the EU's Digital Agenda Europe 2020»
For many years, Swisscom’s network construction strategy has consisted of a continuous and nationwide rollout of the latest network technologies and capacities. On October 8, 2020 we announced the next milestone: We are the first telecommunications company in the world to have achieved transmission speeds of 50 Gbit/s in the access network under real network conditions! We did this by upgrading existing OLT (Optical Line Termination) hardware with a 50 Gbit/s PON (Passiv Optical Network) Line Card prototype. I am personally delighted by the project team’s success and would like to thank all those involved. It is a clear demonstration of our aspiration for technological lead.
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This is a milestone that will open up many opportunities for future applications given the continuously growing need for bandwidth – over the past 10 years, data volumes in the fixed network alone have increased by 1,040%. In the near future, the 50 Gbit/s PON option will allow us to use our existing Fiber to the Home (FTTH) infrastructure in a more convergent and variable manner. In the medium term, we expect this to be useful for the corporate business segment, for adding bandwidths quickly and flexibly, and in the development of 5G antenna sites. Comparable need is not at present expected in the mass (residential customer) market – because we recently launched 10 Gbit/s for this segment, which should be more than enough for the foreseeable.
«The 50 Gbit/s PON option allows us to use our existing Fiber to the Home (FTTH) infrastructure in a more convergent and variable manner»
However, this is just the latest in a number of steps taken to expand the network in recent years. Swisscom started its extensive broadband expansion in 2006 with a large-scale Fiber to the Curb (FTTC) expansion and rollout of the VDSL protocol – then, as now, the appetite for data was driven primarily by online videos. Today, videos and streaming account for around 75% of data traffic in our network. The measures taken in 2006 laid the foundations for Swisscom’s own IPTV television offering, Bluewin TV. Initially ridiculed and not taken seriously, it has gone on to become one of Swisscom's most important offerings. Today, Swisscom is the market leader in the television business with Swisscom blue TV. This success was accompanied by growing demand for ever more powerful networks.
Shortly thereafter, in 2008, Swisscom, in cooperation with local electrical utilities, began the expansion of FTTH in the point-to-point architecture within the top 20 cities in Switzerland, particularly to support economically powerful urban areas within the competitive digital marketplace. As early as 2015, more than one million Swiss households were connected. At the same time, however, the question arose as to how to advance development outside of these urban areas as up-to-date broadband provision for all regions was important for the economic development of the country. It was not only political considerations that played a part here, given the exceptionally pronounced federal culture of Switzerland, but also the self-image of a company wanting to demonstrate its commitment to the entire population and economy in all regions of the country.
It was for this reason that, in 2015, Swisscom started an expansion initiative that was more ambitious than any thus far attempted anywhere in the world – to modernise the majority of the network in each of the more than 2,000 Swiss municipalities by 2021, no matter how small or rural the community. The technology used was a powerful alternative to FTTH. With FTTH, the ambitious plan would have taken decades and would have barely been economically viable. They therefore opted for the Fiber to the Street (FTTS) network architecture, which involves the installation of fibre optics to within 200 metres of buildings. From there, a MicroCAN (an active network element) converts the optical signal into an electromagnetic signal, which is then transported to the customer over the remaining 200 metres using the existing copper cable. The short copper cable distance also permits use of the G.fast protocol, enabling transmission speeds of up to 500 Mbit/s, which Swisscom was the first telecommunications company in Europe, and the second in the world, to introduce back in 2016. To date, Swisscom has connected around 2 million homes and offices, and will reach its target of connecting every municipality by the end of 2021.
«A more ambitious expansion initiative than any thus far attempted anywhere in the world – to modernise the network in each of the more than 2,000 Swiss municipalities by 2021»
We announced the next stage of development in early 2020 with the news that investments would remain at the same level until the end of 2025. By that time, FTTH coverage is to be doubled from around 30%, where we are today, to up to 60%, with FTTH to be newly installed in the point-to-multipoint architecture. Besides enabling higher transmission speeds than the 10 Gbit/s currently offered at lower unit costs, this represents the next logical step in the expansion of the existing FTTS networks. After all, all we have to do is bring the fibre the remaining 200 metres to homes and offices. This also brings a new cost issue into focus. Today, Swisscom operates parallel systems and platforms for both copper and purely fibre-based networks. As FTTH coverage continues to grow, efficiencies will soon be realised by retiring the copper networks – initially at the regional level at least. Swisscom has already launched a number of pilot projects to this end.
We are thus moving gradually closer to our vision of a Switzerland that, thanks to the world’s most powerful telecommunications networks based on fibre and 5G technologies, is ready to take advantage of the latest digital possibilities, such as VR/AR applications or efficient production chains with Industry 4.0 concepts.
CEO Swisscom AG
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