Last Mile Deployment Updates and Impact to CDN Industry

Some trends impact the CDN Ecosystem more profoundly than others. In the next few years, Artificial Intelligence will make its way into CDN architectures. At the same time, growth in the CDN industry will explode, as global networks shift from copper to fiber, and next-gen FTTH (Fiber-to-the-home) technologies like GPON scale to support bandwidth speeds in excess of 1Gbps at the home. In another area, a new movement is taking place in the WiFi segment, as non-carrier companies like Microsoft roll out WiFi hot spots at massive scale. Lastly, let’s not forget about the new satellite ventures popping up all over the place that promise to bring low cost Internet access to the global masses.

According to the latest Akamai’s “State of the Internet” report for Q1 2015, “Global Average Connection Speed” is 5Mbps, and “Global Average Peak Connection Speed” is 29.1Mbps. Based on the summary below, APAC is leading the charge in overall Internet Broadband Speeds, and Canada leads in Mobile Speeds.

Broadband Speeds Mobile Speeds
Singapore Peak Mbps: 98.5 Canada Mobile Peak Mbps: 46.7
Hong Kong Peak Mbps: 92.6 Puerto Rico Mobile Peak Mbps: 42.4
South Korea Peak Mbps: 79 Uruguay Mobile Peak Mbps: 32
Taiwan Peak Mbps: 71.5 USA Mobile Peak Mbps: 17.8
Japan Peak Mbps: 70.1
USA Peak Mbps: 53.3
Brazil Peak Mbps: 24.2

The metrics above are very helpful, but they don’t paint a complete picture. It’s not the “Global Average Broadband Speed” or the “Average Broadband Speed” for a specific country that is the most significant metric; the “Broadband Speed of the Super-User” is the most important. The Super-user is the demographic that has 1Gbps or more at home. Today, there are likely  a few million Super-users around the globe. In 3-5 years, it is likely to be in the tens of millions, if not hundreds of millions of home users. There is an incredible amount of investment activity occurring in the broadband, WiFi, Mobile and Satellite last mile sectors. Here is a snapshot of some of the more recent activities.

  • Comcast aims to deploy 2Gbps in 2.1M homes
  • KT (Korea) will commercialize GiGA LTE that has max download speeds of 1.17Gbps. It will leverage LTE and WiFi, and KT has 11.43M subscribers
  • Canadian carrier Telus is investing $8.8B in Alberta over next four  years to bring fiber to the home
  • Microsoft will deploy 10M hot spots in 130 countries
  • OneWeb Satellite Venture raised $500M to put 600 Satellites in space with the aim to provide lo-cost global Internet access
  • SpaceX has asked FCC for approval to launch satellites to be used for providing Internet access
  • Google is investing $1B in satellites that will offer Internet access to the masses
  • ITU defined a roadmap for 5G called “IMT-2020” that is supposedly able to scale “up to 20Gbps
  • Google “bringing free fast WiFi” to cities around the world

Everyone from Microsoft to Google to Traditional Carriers are investing billions in bringing massive bandwidth to the home user and mobile user. In five short years, we are likely to begin the “Era of Ubiquitous Internet Bandwidth” where bandwidth speeds will be so high that we’ll stop referring to them in Gbps speeds. What happens when a few regions deploy Gbps FTTH technology across a fraction of the population? The repercussions are dramatic, because it is the Super-user that matters most in this equation.

 Regions GPON Users # of Gbps Total Gbps
APAC        30,000,000 1    30,000,000
Europe        10,000,000 1    10,000,000
US          5,000,000 1      5,000,000
LatAm          1,000,000 1      1,000,000
Africa              500,000 1          500,000
Middle East              200,000 1          200,000
 Total    46,700,000
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