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1 Introduction
During 1999 – 2000, ADSL was launched by
most of the European incumbent operators as
well as a number of ISPs.
As the first European incumbent operator Tele-
nor introduced a large VDSL pilot with 700 sub-
scribers, medio 2001. In parallel, some Western
European cable operators have started to up-
grade their networks deploying HFC solutions.
The incumbent operators face further competi-
tion from Local Loop Unbundling and in the
future, LMDS and UMTS operators. The in-
cumbent operator will meet the competition by
starting to roll out ADSL and after some years
VDSL with the potential of a much broader
spectrum of services including video-on-demand
and multimedia applications. This paper exam-
ines various rollout and market share scenarios
for the incumbent operator. The timing for roll-
out of ADSL and VSDL is crucial.
2 The Rollout Case Study
The rollout case study analyses a dense urban
metro area consisting of 65,536 POTS/ISDN
lines (four local exchange areas with 16,384
lines each). The penetration of POTS and ISDN
is ~100 % and the average density of the metro
area is 2,000 households per km2. A cable opera-
tor is deploying an HFC network with cable
modems, while the incumbent operator is
expanding the network to a DSL network.
The cable operator already offers ordinary TV
distribution to their customers in the area under
study, while the incumbent operator offers
POTS/ISDN and Internet. The introduction of
ADSL gives the possibility to offer a large set of
new applications like high-speed Internet, vari-
ous home office applications and multimedia
applications, but not high quality interactive
entertainment applications. VDSL and HFC are
assumed to be competitive solutions, which in
addition offer high quality broadband like inter-
active entertainment applications, etc. The churn
rate for HFC and VDSL customers is rather low
compared to the churn rate for ADSL customers
as the former are strongly linked to the operators
by service bundling.
We consider the service offering as shown