Despite the criticality of deep fiber infrastructure to a successful 5G rollout, a recent Deloitte study warns the United States currently lacks the necessary fiber density to accommodate 5G’s increased speed and capacity, which are necessary to support innovation and economic growth. The study argues that a greater concentration and amount of access points and cell sites are needed — and now.
With data traffic projected to increase four-fold through 2021, the study estimates that the United States requires a deep fiber investment of $130-150 billion over the next five to seven years for:
- Broadband competition
- Rural coverage
- Wireless densification
The investment needed to advance fiber infrastructure will need to come from multiple sources such as communications providers, financial investors and public/private partnerships. This is particularly crucial given that, due to a lack of market incentives to expand fiber, many telecommunications companies are instead focusing their investments on such areas as satellite TV, advertising and advanced business services.
How Fiber Investment Can Address Today’s Access Challenges
In addition to facilitating 5G, upgrading deep fiber infrastructure could increase competition and provide consumers with more broadband choices. As a stark indication of the current lack of market choice, today, 12 years after the first fiber-to-home deployment, 62% of households across the country lack a second provider offering a data speed of at least 25 Mbps.
Furthermore, investment in deep fiber may help bridge the current “digital divide” between urban and rural areas. Fixed broadband is currently available only to 61% of rural communities in the United States compared to 90% nationwide, and the cost to rural customers can be as much as three times what suburban and urban customers pay.
Monetizing “Last Mile” Access
To create greater market incentives for the large-scale fiber deployment necessary to support 5G, the study proposes a few cutting-edge models. These models include:
- Increasing revenue by offering integration, network security, and traffic management services
- Partnering with over-the-top players to fund deployment of fiber
- Maximizing asset utilization by offering fiber as leased real estate
To learn more, read the full study from Deloitte.