25G PON Goes Live, Needs More Deployments to Break into Mainstream

Summary Bullets:

  • 25G PON is market ready and likely to become the technology of choice for operators seeking faster-than-10 Gbps FTTP now and in the near future.
  • Emir Halilovic, Principal Analyst

    The future of 25G PON directly depends on the magnitude of early operator demand and adoption of advanced use cases requiring 25G-specific capabilities.

The Nokia/Proximus announcement of world’s first 25G PON deployment at the end of May was a significant milestone for the global broadband industry. It primarily showed that the 25G PON technology is market ready and significantly outperforming XGS-PON, which is only now becoming mainstream. It also symbolized the increased importance of Europe as a competitive battleground for fixed broadband, which will only continue heating up with increased broadband investment fueled by national broadband plans and post-COVID recovery funds. Finally, the launch served to validate unique capabilities of Nokia’s Quillion chipset, currently the only vendor solution capable of delivering 25G PON.

The operator partner for the launch, Proximus, intends to cover the entire city of Antwerp (~320,000 households) by the end of 2023. The target for the whole country of Belgium is 70% coverage – 4.2 million households – by 2028, which (taking the current coverage into account) means increasing the coverage by 10 percentage points every year. This is supposed to put Belgium at the top of the list of countries by the pace of fiber deployment. Nokia is a partner for this deployment, deploying GPON, XGS-PON, and 25G PON in Proximus’ network.

But beyond this milestone function, the main value of 25G PON in the current market environment is in providing a feasible option for PON infrastructure development beyond its current mainstream use case, residential broadband. Being a symmetrical technology, realistically capable of providing over 20 Gbps on an OLT port, 25G PON provides operators with technology capable of supporting SME or enterprise connectivity, as well as specialized bandwidth-hungry services (like remote surgery), in addition to providing ultra-high quality broadband. It also is a superior wholesale solution – an important aspect for Proximus, which serves 31 wholesale operator clients. Another important use case is 5G X-haul support for dense urban deployments – when the demand for such solutions reaches critical mass.

Keen industry observers will note that the set of extended use cases proposed for 25G PON overlaps with use cases projected for NG-PON2 (also known as TWDM-PON), which largely remains and is expected to stay a niche PON flavor, with a low single-digit percentage of global shipments. Compared to NG-PON2, 25G PON is less complicated and potentially less costly to deploy and offers better coexistence with mainstream GPON and fast-growing XGS-PON. Compared to upcoming 50G PON, which is considered as a future PON standard by the ITU, 25G PON is ready for deployment while the first 50G PON shipments are expected in 2025. This makes the perceived juxtaposition of 25G and 50G PON largely artificial. Judging by the state of today’s PON market, coexistence of several technologies in one operator network – or even in the same network node – is a common practice. 25G PON can serve to bridge the gap between XGS-PON and 50G PON – in terms of speed, market availability, and compatibility.

The size of this gap will eventually determine the fate of 25G PON. If this gap grows, due to 50G PON unavailability, high component cost, or poor coexistence with legacy technologies, there will be more demand for 25G PON, which will reduce the cost of transceivers it uses and motivate more vendors to start supporting it. If the opposite happens, the space for 25G PON will shrink.

The Proximus deployment is just the first step toward mainstream market acceptance of 25G PON, and it needs to be deployed in more (preferably Tier 1) operator networks to secure its place under the sun, especially considering it hasn’t been, and probably won’t be, accepted as an ITU standard. It also needs to be actually deployed in support of its projected use cases, generating new revenue for operators and providing the foundation for deeper analysis of its operational advantages.

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