KRONE facts How KRONE Can "Open the Bottleneck" KRONE BROADBAND As the Internet market continues to explode, the demand for high-speed bandwidth is growing at a fast pace, driven mostly by growth in data volumes as the Internet and related networks become more central to business operations. Drivers The rapid growth of distributed business applications, the proliferation of private networks, e-commerce, and bandwidth intensive applications (such as multimedia, videoconferencing and video on demand-VOD); as well as the continuing deregulation and privatisation of telecommunications networks throughout the world, all help fuel the demand for this bandwidth. Broadband Access Broadband access is one of the most crucial pieces of next-generation networks and although carriers are under tremendous pressure to keep costs down, in order to meet future needs, strategic investments are required to build and deploy next generation backbones. Service providers are utilising various technologies and streaming techniques to move content closer and closer to the edge of the network. These next- generation networks ensure massive core capacity but the challenge now is the delivery of broadband over the last or first mile (local loop bottleneck) to the customer. " Connectivity choices made today can influence tomorrow's broadband networks" . The above statement is directly related to the service providers profitability and as such is vitally important to them. The utilisation of the new KRONE Broadband modules will enable the following: 1.Carriers with legacy networks to upgrade to broadband delivery capability and more importantly, for these incumbents to RETAIN customers i.e. reduce churn 2.Service providers and CLECs to implement the latest broadband technologies Competing Technologies There are currently a number of competing technologies such as xDSL, cable modems, broadband satellite, broadband fixed wireless etc however the most promising technology capable of delivering full service is Very-High-Data-Rate DSL (VDSL). VDSL is both symmetric and asymmetric and provides up to 52 Mbps of bandwidth over voice on a single twisted pair copper loop. This copper cable could be within an ILEC's legacy network or in a CLEC's new FTTC rollout. Broadband, the Potential The potential for growth in broadband infrastructure is massive. It is clear that carriers need to upgrade their legacy networks to support broadband. New players such as CLECs and service providers are eagerly targeting this market utilising KRONE (Australia) Holdings Pty Limited 2 Hereford Street Berkeley Vale NSW 2261 PO Box 335 Wyong NSW 2259 Phone: 02 4389 5000 Fax: 02 4388 4499 Tech Support: 1800 801 298 Email: kronehlp@krone.com.au Web: krone.com.au Copyright © 2004 KRONE (Australia) Holdings Pty. Limited Job No.: 6221 V2 08/04 the latest technologies such as high speed DSL for their broadband delivery. By December 2003 there were 100 million broadband lines. This was an increase of 63% from the previous period in 2002 as reported by research company Point Topic. Of this, copper based DSL technologies account for 64% of the lines whilst cable modem based broadband delivery was 36%. DSL growth remained ahead of cable modem and other broadband growth overall, growing at 32% in the second half of 2003 compared to a modest 18% for cable modems in the same period. The growing demand for broadband access and its cost effective delivery to subscribers will ensure this trend continues. The Point Topic research indicates that DSL is the connection of world choice. Total DSL subscriptions surpassed 64 million lines, with the service's popularity mostly attributed to the sharp rise during the second half of 2003 in the number of DSL subscribers in the Asia-Pacific and EMEA regions, 31.5% and 38.7% respectively. As reported by the Yankee Group, by 2008 more than 8 million business DSL connections across the region will generate $5.4 billion in revenue. It is forecast that at this time the two dominant markets, Japan and China, will hold more than 56% of the region's business DSL subscribers. DSL more than doubled during 2002 and is continuing to grow strongly throughout the world. Global broadband access service revenue will rise by more than US$136 billion over the next 6 years, according to a new forecast from Pioneer Consulting. The company predicts that total revenues will reach US$229 billion by 2008, up from US$93 billion in 2002. Based on current development rates, there " could" be up to 200 million DSL broadband subscribers by 2005. The KRONE Broadband Family To enable KRONE globally to meet the challenge of these new applications and to assist carriers in " opening the last/first mile bottleneck" , KRONE Australia has developed the " Broadband" range of modules. Differentiated by purple printing on the turrets, this new range complements the classic HIGHBAND ® which is utilised for in-building delivery, thereby, seamlessly linking Access NET ™ with Premis NET ® applications. This then provides our customers with broadband " end-to-end" connectivity. The following is the range at present: Modules Ü Broadband 10 Ü Broadband 8 (standard) Ü Broadband 8 (compact) Ü Broadband 25 Outlet Ü Broadband 8P4C pin in RJ45 format (purple nose piece) Ü Broadband 8P8C RJ45 Protection Ü Broadband 10 pair protection magazine Ü One pair protector (ComProtect ® ) Ü 10 pair earth strip Splitters Ü LSA Direct for Ü Central office applications Ü NGDLC (Next Generation Digital Loop Carrier) Ü ONU (Optical Network Unit) Ü Third party badged " dynamic" and " standard" splitters as per in-country customer premise equipment specifications Ü Third party splitters for central office applications The Winning Edge KRONE Australia commissioned an independent test house, Power and Digital Instruments Pty Region (Millions) Americas 13165 Asia-Pacific 32179 EMEA 18770 “Top Ten” Broadband countries by number of lines. Source: Point Topic - 23rd March 2004 Ltd, to evaluate the performance of the Broadband range to the new VDSL standards against other connectivity modules available in the market. A white paper on " The Critical Effects of Cable Termination Equipment on VDSL Loop Performance" is available from KRONE. Quote from Consultant - Mr. George Georgevits (B.E. Hons.) " The graphs clearly demonstrate an advantage (dB) with the KRONE Broadband module in channel return loss and channel NEXT performance. Even a few dB of additional channel headroom has significant implications in terms of maximum channel reach. It can have a big impact on overall network rollout costs" . Unique Properties of the KRONE Broadband Series The following are the unique features of KRONE Broadband as identified by independent testing. Ü The modules exhibited a higher performance than the competitors in NEXT and Return Loss. Ü This translates to the capability to reach longer distances than the competitors in quality signal delivery and therefore open greater potential revenue streams to the service providers. Ü The much smoother response of our Broadband modules ensures a greater quality of signal and therefore less retransmissions which in turn leads to less compensation needed to be provided by the manufacturer. Ü Broadband modules performed a degree of NEXT compensation at the higher frequencies, in other words, the modules actually reduced NEXT. Ü KRONE Broadband modules will provide additional headroom when deployed onto existing infrastructure. As stated previously, the two main parameters affecting broadband delivery over copper are Return Loss (RL) and Crosstalk. The following graphs, extracted from this testing clearly illustrates the KRONE Broadband modules unique performance. KRONE facts The KRONE Broadband Family Note Channel NEXT and RL graphs: Competitor A 10 pair module Competitor B 10 pair module Competitor C 10 pair module Competitor D 10 pair module BB is KRONE’s Broadband module The chart above shows the KRONE Broadband 10 module compared to other available, non-KRONE modules for Return Loss at 0-12 MHz. From the graph you can see that Broadband has a much smoother response over the whole 12 MHz range and performs better than the competitors. The worst case mean return loss degradation for Broadband is around 2 dB and for competitor modules in the range of 5-6 dB. C rosstalk is a disturbance caused by an electric or magnetic field of one telecommunication signal affecting a signal in an adjacent circuit and this can cause a severe degradation in transmission. There is more detail on this subject later in the document. However, it is important to note that the consultant's investigation found that the Broadband modules performed a degree of NEXT compensation at the higher frequencies. In the following graph, below the 0 line indicates NEXT compensation and the measurements above the line indicate NEXT degradation. From the graph above, it can be seen that the KRONE Broadband module has the most stable performance. The Broadband whole frequency performance indicates a net positive influence that no other module matches. The Return Loss Performance of the KRONE Broadband module at 30 MHz exhibits a far superior performance to any competitor module. Particularly at the higher end of the spectrum, Broadband performs up to 6 dB better. NEXT at 30 MHz shows that the Broadband module induces no loss over the frequency spectrum while all others contribute a net loss in NEXT performance. Application Areas for KRONE Broadband There are numerous application areas that have been identified such as: Ü Direct central office delivery of VDSL i.e. DSLAM in central office over copper to the customer. Channel Ret Loss Change Due to Modules at 0-30 MHz Channel NEXT Change Due to Modules at 0-30 MHz Channel Ret Loss Change Due to Modules at 0-12 MHz Channel NEXT Change Due to Modules at 0-12 MHz KRONE facts Ü Passive Optical Networks (PON's) with VDSL for the " last mile" . Ü Metro Ethernet, an emerging technology which again utilises FTTC/FTTB and VDSL for " first mile" delivery. Ü Legacy network upgrades to a broadband capability i.e. MDF, CCC and DP. Ü xDSL applications in general. Ü Futureproofing of networks. Ü Migration of ADSL to VDSL: Drivers being: Ü Increasing multimedia services (VOD) Ü Bandwidth exceeds ADSL performance Ü Migration to full service networks Ü Replace multiple ADSL or E1/T1 Links Ü VDSL link needed to satisfy thirsty business applications such as CAD/CAM About the ITU-T FS-VDSL Focus Group The drivers of the new VDSL standards were sixteen network operators and fifty two equipment vendors, who envisage a new multi-service video- centric network platform based on VDSL delivery, which will enable operators and service providers to provide end-users with a rich mix of video, data and voice services. By utilising global ITU-T standards, greater economies of deployment are expected. The use of VDSL rather than today's typical ADSL provides significant increase in bandwidth enabling provision of multiple digital TV channels including HDTV and on-demand services, along with high- speed data and multiple voice channels. Emerging Technology A new application for the Broadband modules, " Metro Ethernet" , is now emerging. Based on the traditional local area network Ethernet technology, so called Metro-Ethernet services are emerging as a new form of high speed Internet access offering wide-range scalability. Ethernet in the First Mile (EFM) In November 2000, the IEEE 802.3 Ethernet working group formed an Ethernet in the first mile study group. It was christened as " first mile" to emphasise the need to put end customers first. It is expected that the task force will adopt Ethernet over VDSL, which means using an Ethernet Media Access Control layer (MAC) on top of the VDSL physical layer. Ethernet over VDSL (EoVSL) technology is the ideal solution for delivering 14 Mbit at 12 Mhz and up to 52 Mbit at 30 Mhz utilising KRONE Broadband modules. Metro Ethernet Metro Ethernet services take the well proven and accepted benefits and advantages of Ethernet LANs such as low cost equipment, efficient and proven technology to the public space with carriers and service providers. At this time, EFM for residential access is currently mostly an Asia-Pac phenomenon, and will largely remain so through to 2006. Reasons for this include heavy reliance on Multi-Dwelling Units (MDUs), short local loop lengths, low labour costs, government support, and, particularly in the case of China, the need to deploy new infrastructure. EoVDSL (Ethernet over VDSL) EoVDSL technology enables network designers to build high performance access networks for multi- unit buildings (MxU) and enterprise campus environments. MxU buildings include hotels, residential multi dwelling units (MDUs) and commercial multi tenant units (MTUs). Enterprise campuses include manufacturing sites, educational campuses and hospitals. As data rates in these environments are suitable for multiple channels of video service, in addition to voice and data applications, the potential need for KRONE's Broadband connectivity is clear. EoVDSL is also ideal for network access to residential customers from curbside distribution boxes and nodes and again, our new KRONE Broadband products are particularly applicable here. VDSL, What Is It? VDSL (very high-speed digital subscriber line) has sufficient bandwidth to deliver two or more streams of uncompressed MPEG-2 video, with plenty of overhead for broadband Internet access and other digital services. Specialised implementations of VDSL that are also promoted for video applications include long-reach Ethernet and Rate Adaptive DSL Ü Targets both Fibre to the Curb (FTTC) and in-building applications Ü High downstream bandwidth for distances up to 1 mile or 1.5 Km Ü 50/30 Mbps up to 300 metres Ü 36/12 Mbps up to 1000 metres Ü 15/3 Mbps up to 1500 metres VDSL is Designed to Allow Ü Three video streams to run concurrently to three TVs. This is to suit typical usage demographics. Ü Life line POTS telephone (splitter required) Ü Highspeed Internet 2-3Mbit (downstream) Ü VoIP additional telephone lines, fax, alarm Ü Video on Demand It is very interesting to note that Korea who are the world leaders in the utilisation of ADSL are rapidly upgrading their networks to VDSL. This migration will allow services such as Video On Demand (VOD) to be adopted. What the Physical Network Entails Ü D igital HHead EEnd - the storage medium for content, this can be inclusive of a satellite downfeed or fed by fibre from a shadow Head End. This can serve a group of exchanges on a fibre ring or star (FTTEx). Ü F ibre DDistribution ffrom EExchange - this is a PON (Passive Optical Network) system to active CCCs adjacent to passive copper cabinets (FTTCab or FTTN) or directly to multi tenant buildings (FTTB). The PON will probably be APON (ATM PON) although standards include the use of EPON (Ethernet PON). Ü F ibre tto CCopper - the PON will terminate in an ONU with a VDSL DSLAM and be linked KRONE facts into the existing copper distribution network with a splitter. Ü C ustomer TTermination - the line will terminate on a splitter and CPE VDSL modem. Connectivity/Delivery Issues Any successful deployment of a broadband service in reality begins with the establishment of a reliable, high quality, well-engineered local loop. Field and laboratory tests have shown that legacy infrastructure in the access network and in customers premises can be an impediment to higher bandwidth and higher speed services. The transmission characteristics of old copper infrastructures can lead to increased bit errors, slowing down of transmissions and increasing traffic due to signal reflections, in particular at junction or interconnect points (also known as impedance mismatches). The new Broadband modules are designed for this segment of the network to maximise delivery capability. With legacy network upgrades, carriers will be faced with a variety of lines and differing quality in the OSP. The ability of a specific copper pair to support a broadband service depends on a number of factors: Ü Basic line impairments: The presence of loading coils, line taps, leakage, or physical faults on a line means that it cannot support transmission of high bandwidth signals. Ü Attenuation: To successfully carry a broadband service, a line must be capable of transmitting a minimum signal level from one end to the other (that is, it must exhibit a minimum level of attenuation). Ü Noise: When noise, generated by crosstalk or external sources is superimposed on the line, the overall signal-to-noise ratio (SNR) is impaired. This factor can reduce effective bit rate or loop reach of the service. Crosstalk, What Is It? The independent testing conducted for KRONE Australia showed a unique USP of the Broadband family minimising crosstalk, one of the most critical factors in effective broadband delivery. Crosstalk can be categorised in one of two forms: Ü Near end crosstalk, commonly referred to as NEXT, is the most significant because the high-energy signal from an adjacent system can induce relatively significant crosstalk into the primary signal. Ü The other form is far end crosstalk, or FEXT, which is typically less of an issue because the far end interfering signal is attenuated as it traverses the loop. Broadband Modules NEXT Compensation As mentioned earlier in the document, the Broadband modules performed a degree of NEXT compensation at the higher frequencies, thereby improving signal quality. What Causes Return Loss (RL)? Variations in the impedance of a cable produce RL; therefore, anything that affects impedance tolerance affects RL. This includes the basic construction of the cable, from the size, shape, and make-up of the conductors; choice and manufacturing of the insulation or dielectric; and choice of shield elements and materials. Return loss can also be dramatically affected by the choice of connectors and other passive components. Legacy Network Upgrades With the above in mind, when service providers need to upgrade their networks to a broadband capability on legacy cable infrastructure, the choice of connectors utilised to introduce the service can have a crucial impact on the whole circuit performance. Often the upgrading can be as simple as replacing the physical cross connect in the BD, DLC or DP with Broadband modules improving return loss and thereby improving the transmission characteristics of the line. KRONE Broadband modules will provide additional headroom when deployed onto existing infrastructure. So What Does This Mean to a Service Provider? Ü Due to this unique KRONE Broadband module performance, the service providers can expect greater quality of signal delivery KRONE facts therefore reducing resends and the required compensation requirements. Ü One of the greatest challenges today for the incumbents is customer retention. By utilising the KRONE Broadband module family, they will be able to quickly offer access to the latest technologies Ü Perhaps the greatest benefit of all is the extension of reach the KRONE Broadband family offers and therefore the increase in the amount of customers service providers can supply. This translates to higher revenues to the provider. Conclusion KRONE Broadband modules are the highest performing available today. They will enable carriers and service providers to develop and deploy network architecture that will: Ü Allow legacy networks to be upgraded to a broadband delivery capability Ü Enable service providers to migrate to the latest technology with minimum expenditure Ü Will provide a futureproof foundation for growth Ü Will provide the path to NEW revenue streams for the service provider What KRONE Can Offer Ü " Broadband" copper connectivity in the central office and active or passive cabinets. Ü Complimented by HIGHBAND ® for the building cabling thereby providing seamless broadband delivery. Ü " Broadband" copper connectivity for legacy network upgrades. BD/CCC/DP Ü LSA Direct with built in VDSL splitter with/without protection (overvoltage or maintenance free). Ü Third party badged " dynamic" and " standard" splitters as per in-country customer premise equipment specifications Ü Digital Head End - fibre frames, connectivity, patching, pigtails and monitoring at both ends. Ü Fibre Distribution from Exchange - fibre frames, connectivity, patching and pigtails. Ü Fibre closures with management and PON splitters. Ü Upgrade or new build with Broadband modules to offer enhanced throughput in the ranges up to 12 MHz and 30 MHz. Ü Comprotect for both ADSL and VDSL applications. KRONE (Australia) Holdings Pty Limited 2 Hereford Street Berkeley Vale NSW 2261 PO Box 335 Wyong NSW 2259 Phone: 02 4389 5000 Fax: 02 4388 4499 Tech Support: 1800 801 298 Email: kronehlp@krone.com.au Web: krone.com.au Copyright © 2004 KRONE (Australia) Holdings Pty. Limited Job No.: 6221 V2 08/04 . KRONE facts How KRONE Can "Open the Bottleneck& quot; KRONE BROADBAND As the Internet market continues to explode, the demand for high-speed. is KRONE s Broadband module The chart above shows the KRONE Broadband 10 module compared to other available, non -KRONE modules for Return Loss at 0-1 2