• SIP
Broadband & Mobile Featured Article
March 14, 2008
Report Recommends 20-25 years Life Cycle for Fiber Optic Cable
By Calvin Azuri TMCnet Contributing Editor
Technology Futures, (TFI) has recommended that the newly installed fiber optic cable in the local exchange network, have a depreciation life of 20-25 years. The depreciation is calculated by taking into consideration factors such as physical mortality, technological substitution, and access line losses due to competition. Previously the depreciation life was estimated to be 15-20 years.
The new report, titled “Depreciation Lives for New Fiber Optic Cable in the Local Exchange Network”, has greater insight into the data upon which the recommendation is based. It also documents the substantial upgrades that the cable will be undergoing, for example, AT&T’s Project Ligthspeed and Verizon’s FiOS (News - Alert).
As noted by report lead-author, Lawrence K. Vanston, Ph.D., "The incumbent local exchange carriers (ILECs) are making these investments with full knowledge that the market is competitive." He adds, "There is no obvious technological replacement for the full-spectrum fiber the ILECs are now placing."
The report goes on to enumerate other factors that may have a potential effect on the economic depreciation lives. An example would be the possibility of obsolescence, which is caused by newer technologies and new network architectures. A second example is the effect that the competition would have; competitors like, broadband powerlines and wireless broadband. The conclusion drawn, in the report, whilst taking all these factors into consideration, is that 20-25 years is a sufficient time period to sustain the impact of these factors, at least for the present.
The report holds water in the cases of local exchange fiber and only to networks being upgraded to very high speed broadband, such as AT&T’s Project LightSpeed, and Verizon’s (News - Alert) FiOS. The Technology Futures, Inc. predictions have been used previously used for valuation, regulatory, planning and financial reporting. The TFI depreciation studies are sponsored by the Telecommunications Technology Forecasting Group comprised of AT&T, Bell Canada, Qwest (News - Alert), and Verizon.
The lead-author Lawrence K. Vanston, Ph.D., is an international figure, and an established expert on the use of technology forecasting in the telecom industry. His research reports and forecasts are used and referenced extensively worldwide. His forecasting ability has been well documented and quite famous. The September 21, 1998 issue of "The Wall Street Journal" featured an in-depth interview entitled "Consultant's Call: Lawrence Vanston Makes Some Pretty Bold Predictions for the Future of Telecommunications. He Has Been Right Before." The predictions he made at that point of time have also come to pass.
Calvin Azuri is a TMCnet Contributing Journalist.
The new report, titled “Depreciation Lives for New Fiber Optic Cable in the Local Exchange Network”, has greater insight into the data upon which the recommendation is based. It also documents the substantial upgrades that the cable will be undergoing, for example, AT&T’s Project Ligthspeed and Verizon’s FiOS (News - Alert).
As noted by report lead-author, Lawrence K. Vanston, Ph.D., "The incumbent local exchange carriers (ILECs) are making these investments with full knowledge that the market is competitive." He adds, "There is no obvious technological replacement for the full-spectrum fiber the ILECs are now placing."
The report goes on to enumerate other factors that may have a potential effect on the economic depreciation lives. An example would be the possibility of obsolescence, which is caused by newer technologies and new network architectures. A second example is the effect that the competition would have; competitors like, broadband powerlines and wireless broadband. The conclusion drawn, in the report, whilst taking all these factors into consideration, is that 20-25 years is a sufficient time period to sustain the impact of these factors, at least for the present.
The report holds water in the cases of local exchange fiber and only to networks being upgraded to very high speed broadband, such as AT&T’s Project LightSpeed, and Verizon’s (News - Alert) FiOS. The Technology Futures, Inc. predictions have been used previously used for valuation, regulatory, planning and financial reporting. The TFI depreciation studies are sponsored by the Telecommunications Technology Forecasting Group comprised of AT&T, Bell Canada, Qwest (News - Alert), and Verizon.
The lead-author Lawrence K. Vanston, Ph.D., is an international figure, and an established expert on the use of technology forecasting in the telecom industry. His research reports and forecasts are used and referenced extensively worldwide. His forecasting ability has been well documented and quite famous. The September 21, 1998 issue of "The Wall Street Journal" featured an in-depth interview entitled "Consultant's Call: Lawrence Vanston Makes Some Pretty Bold Predictions for the Future of Telecommunications. He Has Been Right Before." The predictions he made at that point of time have also come to pass.
Calvin Azuri is a TMCnet Contributing Journalist.
