Cable TV operators are facing a critical decision: whether to continue investing in traditional hybrid fiber coaxial (HFC) DOCSIS networks or deploy fiber to the home (FTTH) in newly built areas. At present, most operators choose FTTH in newly built areas and use XGS-PON technology to renovate existing areas, but the most strategic operators will further upgrade their networks using 25G-PON technology.

25G-PON brings not only bandwidth improvement. It can provide differentiated services for operators, increase average revenue per user (ARPU), and enhance long-term network flexibility. For cable operators facing pressure from fiber optic competitors, telecommunications companies, municipal agencies, and fixed wireless service providers, this technology can help regain a competitive advantage.

Limitations of DOCSIS and HFC

HFC networks and historical DOCSIS technologies have played important roles, but their limitations are becoming increasingly apparent. According to MoffettNathanson data, the growth of cable users has slowed down since 2021, and there has been a continued net loss since the end of 2023. Consumers are shifting towards higher performance FTTH or lower cost fixed wireless services.

Operators face three upgrade options for their existing networks: adopting DOCSIS 3.1 Plus progressive upgrade, deploying DOCSIS 4.0 (spread spectrum or full duplex), or fully transitioning to FTTH.

Based on the technological advantages of fiber optics and passive optical networks (PON), FTTH has sufficient persuasiveness. But more importantly, there are business opportunities – providing high-quality residential/enterprise services with high ARPU and standard residential services through the same fiber optic network can create greater competitive advantages.

XGS-PON is the foundation rather than the endpoint

The current mainstream PON technology XGS-PON can provide symmetrical 10Gbps capacity, perfectly meeting the demand for gigabit/multi gigabit residential services, and is also suitable for enterprise services, mobile carriers, smart cities and other scenarios. Its biggest advantage is the ability to smoothly evolve to 25G-PON, opening up more possibilities.

Three reasons to choose 25G-PON

Firstly, in a fiercely competitive market, 25G-PON can help operators surpass competitors based on XGS-PON; In unaffected markets, top tier services can serve as a deterrent and prevent future competition.

Secondly, the theoretical 10Gbps bandwidth of XGS-PON is only about 8.3Gbps due to network overhead, forward error correction, and other factors, while 25G-PON actually provides 21.5Gbps, enabling operators to economically and efficiently provide real 10G services, realizing the monetization of enterprise, mobile bearer, high-end residential, and wholesale businesses.

Thirdly, traditional cable operators achieve differentiation by bundling video services, but since 2018, the number of cable video users in the United States has decreased by 25% due to the impact of streaming media. The performance advantage provided by 25G-PON will become a new “sticky” selling point.

Considerations for 50G-PON

Although 50G-PON products are beginning to emerge, their deployment cost is currently three times that of 25G-PON (excluding China), and the price difference will remain more than twice until at least 2030 (Omdia data). 25G-PON has the conditions for large-scale deployment due to the use of mature components in data centers, while 50G-PON still needs several years of optimization to become popular.

For high multi gigabit services below 20Gbps, 25G-PON is the most preferred in terms of bandwidth, cost, energy efficiency, and deployment convenience. If a service of over 20Gbps is needed before 2030, 50G-PON can be considered, and after 2030, it will evolve towards 100G-PON.

Coexistence architecture reduces decision risk

The most crucial thing is that the operator does not need to choose between 25G and 50G. XGS-PON, 25G-PON, and 50G-PON are designed for wavelength coexistence, allowing different generations of PON to share the same fiber. Operators can first deploy XGS and 25G, and then increase investment after the 50G technology matures.

The Road to the Future

25G-PON achieves performance leadership in a low-risk, high return manner. It not only supplements XGS-PON capabilities, but also expands service boundaries and lays the foundation for 50G deployment. When cable operators formulate strategies, they not only need to consider technical feasibility, but also need to measure strategic value. Fiber optic is the future, and the advantage belongs to those who take immediate action.