Alcatel-Lucent ALU and communications services company BT have started a consumer trial of G.fast technology in Gosforth (situated in North-Eastern England), for offering ultra-broadband access to consumers.
BT and Alcatel-Lucent’s R&D subsidiary Bell Labs previously collaborated to develop the G.fast technology, which is currently undergoing trial with over 30 global operators. G.fast technology can infuse the speed of ultra-fast fibers in traditional copper wires of telephones that in turn enables service providers to offer ultra-broadband services in locations where traditional fiber deployment is difficult.
BT and Alcatel-Lucent had tasted success in their prior pilot trial conducted around Hethersett, albeit on a much smaller scale. Following this success trail, the latest BT trial includes 2,000 homes in Gosforth and will be run for 6–9 months to reach meaningful insights. The companies anticipates that G.fast, in the ongoing trial, can attain data speeds as high as 330 Mbps directly into premises.
The above-mentioned trial, which is also the largest G.fast trial in the world, will lead to significant benefits for customers. With this technology, they will not only be able to experience better broadband speeds, HD video downloads and faster streaming, but also enjoy new services like 4K TV channels.
With analyst predictions suggesting that one million “video content” will cross global fixed or mobile network per second within the next five years, Alcatel Lucent believes this is the most opportune moment for testing ultra broadband access technology.
With intensifying competition among cable, telecom and over-the-top content service providers, G.fast technology is now widely used by operators to boost the bandwidth capabilities of copper-based access networks. According to consultancy firm Ovum, the share of G.fast technology in ultra-bandwidth copper networks will increase steadily over the next few years.
Moreover, the G.fast chip market, which was worth $31 million in 2014, is expected to grow to $2.9 billion by 2020. This market is currently dominated by vendors which include Alcatel Lucent, Huawei, Ikanos and Sckipio. Being a key chipset and equipment manufacturer aiding the deployment of G.fast technology, Alcatel-Lucent stands to reap significant benefits from growth in this market.
However, despite its leading position in the market, Alcatel-Lucent continues to face severe impact from political and economic uncertainties in the countries it serves. Moreover, stiff competition from major international and regional players adds to its woes. This apart, the company’s rising debt level and operating expenses are proving to be a drag on its financials. Based on these factors, the company currently carries a Zacks Rank #5 (Strong Sell).
Better-ranked stocks in the industry include Envivio, Inc. ENVI, SeaChange International, Inc. SEAC and UTStarcom Holdings Corp. UTSI. All three stocks sport a Zacks Rank #1 (Strong Buy).
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