SIEPON prevents carrier islands

OvumParticipating carriers and vendors are hoping that the IEEE’s SIEPON (Service Interoperability in EPON) Working Group will prevent the Galapagos syndrome – the evolution of products in isolation.
SIEPON signals the next major step in standardization for FTTx deployments. Simply stated, it is a broad-based international user group. SIEPON enables FTTx wannabe carriers to co-opt the testing, deployment, and maintenance protocols of those carriers that have expended vast people and equipment resources refining those protocols.
For carriers with existing FTTx networks, SIEPON motivates equipment vendors to ensure interoperability across all areas, from simple equipment mix-and-match to advanced applications. 
SIEPON is an unusual standards-working group for the IEEE. Rather than focusing on technical solutions, it focuses on the sharing and reutilization of best practices in networks supporting more than 40 million EPON-based FTTx subscribers.
SIEPON participants include carriers (including China Telecom, NTT, KDDI, KT, and China Mobile), equipment vendors (including Huawei, ZTE, Fiberhome, Alcatel-Lucent, Ericsson, Mitsubishi, Sumitomo, Fujitsu, Hitachi, and OKI), and chip vendors (including Broadcom, PMC, Cortina, and Marvell.)
It is unusual for major carriers such as China Telecom and NTT to share their specifications, test protocols, and findings. This sharing will, however, enable them to influence the vendors’ offerings, in essence creating a worldwide standard for service interoperability with conformance testing and a planned certification program.
Carriers entering FTTx testing and initial deployment phases can benefit from the experience of NTT and China Telecom and take advantage of vendor compliance certification. Both sets of carriers can influence the vendors, creating an international standard and compliance program that should lead to lower cost equipment for all.
We find it interesting that China Telecom and NTT are active participants in SIEPON. NTT was one of the first carriers to test and deploy EPON; its suppliers have been Japanese to date.
Will SIEPON help non-Japanese vendors such as Huawei, ZTE, Ericsson, or Alcatel-Lucent penetrate the Japanese market, or will NTT remain focused on equipment from the usual Japanese-based communications equipment vendors?
China Telecom spent significant time and lab resources on interoperability, at the chip level and then at the system level. It recently announced plans to reach 100 million FTTx subscribers by 2015.
The largest EPON equipment suppliers to China Telecom are Huawei, ZTE, and Fiberhome – all SIEPON participants.
We are skeptical that SIEPON will lead to any significant wins by Japanese equipment vendors in China or by Chinese equipment vendors in Japan. We believe that Japanese and Chinese carriers and vendors want to prevent what is known in Japan as the “Galapagos syndrome” – developing a standard or product that evolves isolated from other world markets.
China Mobile’s use of TD-SCDMA, the Chinese 3G standard, impacted compatibility with popular handsets such as Apple’s iPhone. Similarly, Japan’s cell phones have been criticized as being too fine-tuned for the Japanese market to compete well abroad.
In China, Apple partnered with China Unicom, whose wireless network is based on the GSM/UMTS standard used by iPhone’s carrier partners around the world. There are discussions between China Mobile and Apple for the adoption of the iPhone to support China Mobile’s TD network.
Does SIEPON take away the respective competitive advantages of each vendor, or does it expand available market share for vendors since they attain worldwide standard certification? Given the large number of vendors involved, we believe that SIEPON helps them compete in most markets. With wide-reaching standards, vendors can meet system specifications and interoperability testing across different carriers and geographies.
Chinese equipment vendors are winning contracts outside of China (and Japan). We expect these wins to continue.
The decision on EPON versus GPON is based on a long list of variables. SIEPON alone is not enough to tip the scales in favor of EPON given the influence of other factors, such as existing vendor relationships and pricing plans.
However, SIEPON does prevent a carrier from becoming an island, thereby increasing the number of certified vendors, which can lead to lower cost FTTx equipment.