Optical Network City Construction Becomes New Growth Point for Telecom Equipment Industry
China Telecom Leads Optical Network City Construction
With the rapid development and wide application of information technology, information infrastructure has become an important foundation and symbol of economic and social development. Since the launch of the "Broadband China·Optical Network City" project, optical network city construction based on informatization has become a new hotspot for China Telecom.
According to the goals of the "Broadband China·Optical Network City" project, the access bandwidth of China Telecom broadband users will leap more than 10 times within 3-5 years and will continue to improve rapidly; tariffs will enter a "transition period" in about 3 years and will continue to decline. Southern cities will achieve full fiber deployment, core urban areas will all have fiber access, with maximum access bandwidth reaching 100M, and urban household access bandwidth generally reaching 20M or above...
Today, China Telecom has made achievements in fiber-optic transformation of broadband networks, wireless city (WiFi), smart city, and other constructions.
FTTH network construction is an important task of the "12th Five-Year Plan". In 2011, China Telecom operators successively released large-scale FTTH deployment plans, and the FTTH market scale continued to expand. It is understood that Shanghai Telecom's "City Optical Network" coverage capacity has exceeded 3 million households, with "City Optical Network" users surpassing 800,000, making Shanghai the fastest-growing city for FTTH development in China.
On the other hand, the pace of wireless city construction has also further accelerated. As a supplement to 3G traffic and an effective means of achieving high-speed transmission, Wi-Fi technology is increasingly entering the public eye. China Telecom is vigorously promoting WiFi hotspot coverage, with Tianyi WiFi hotspots now spread across campuses, hotels, hospitals, stations, and other areas. According to He Zhiqiang, Director of China Telecom's Marketing Department, revealed last year, by the end of 2011, WiFi hotspots increased to 700,000, and by 2012, hotspots will increase to 1 million.
Optical Network City Construction Benefits Telecom Equipment Industry
Broadband is an important foundation for national economic and social development and a vital link between national industrialization and informatization. The "Broadband China·Optical Network City" project requires the joint participation and efforts of the equipment manufacturing industry, communication construction service industry, internet application, and information service industry. With the full implementation of the "Broadband China·Optical Network City" project, the application effects and radiating role of China Telecom's broadband services on the national economy and various social fields have become increasingly prominent, actively promoting the growth of the telecom equipment industry in the industrial chain.
The urban optical network construction promoted by China Telecom is a high-performance optical network based on FTTH and FTTB optical access technologies. The increase in broadband infrastructure investors will undoubtedly help drive demand for the communication equipment industry, especially optical communications. In addition, with the rapid development of new bandwidth applications such as mobile internet, the Internet of Things, and cloud computing, transport networks urgently need higher capacity. The optical communications market has ushered in a new round of prosperity, and the dominant position of Chinese telecom equipment manufacturers will be further consolidated.
Optical Communications Industry Faces Many Challenges
With the continuous expansion of 3G user scale, intensifying broadband service competition, and the continuous advancement of triple play, the three major domestic telecom operators have accelerated the pace of optical network city construction. In addition, the national-level "Broadband China" national strategy is also about to be launched, which will further accelerate the broadband process. These are all opportunities for faster and greater development of China's optical communications technology.
Huge demand drives market development. Currently, China has become the world's most important optical fiber and cable market and the world's largest optical fiber and cable manufacturer. It is understood that China currently holds a 20%-25% share of the global optical component market. In the "2010-2011 Global Top 10 Most Competitive Optical Communications Enterprises" list for global optical fiber and cable, 3 of the top 10 enterprises are Chinese.
The other side of opportunity is often challenge, and China's optical communications industry also faces numerous tests.
Low prices and thin profits have gradually shrunk the survival space of domestic optical component enterprises. Some experts say that although market demand for optical components is strong, the potential risks of capacity expansion and oversupply are also significant. Due to expanding market demand, optical component prices have continued to decline. It is understood that the current price of fiber splitters has dropped 40% compared to 2008. In addition, operators' excessive emphasis on price in centralized procurement has caused manufacturers to continuously lower quotes. With small profits, manufacturers' survival space will gradually shrink. The entire broadband industry environment urgently needs further optimization by operators and communication equipment manufacturers.
From an international perspective, there remains a considerable gap between China's key optical component technologies and those of foreign companies. High-end key chip technologies are in the hands of foreign companies, which severely restricts the production of domestic high-end components. Increasing investment in high-end R&D and mastering key core technologies are the primary tasks for the Chinese government and the optical communications industry.