A factor limiting the cost minimisation of networks is the difficulty of forecasting demand and technological change. Telecommunications assets are not always long lasting, but there is ample room, in the fifteen-year life of a telephone exchange or the ten-year life of a satellite, for a cheaper technology to evolve. Additional calls are catered for mainly by the provision of extra plant or, as is often the case, the reconfiguration of existing plant to provide more capacity. For example, optical-fibre cables, which use digital transmission, make room for more lines in the duct network. No operator will have perfect foresight, but some will make better guesses than others. City networks may be immensely complicated and far from minimum cost, reflecting the combined effects of incremental growth and the difficulty of forecasting. Telecommunications networks are always suboptimal compared with what might be built for a mature market with static technology. Future-proofing may improve the cost characteristics of networks if they can allow for change. Analogue exchanges have been efficiently modernised by the installation of electronic control packages. New pieces of plant at either end of a cable can enable the same line to carry many times more information by increasing transmission capacity by using improved multiplexing methods. This can be done with optical fibre and with copper.

Inspec keywords: costing; telecommunication networks

Other keywords: telecommunication assets; future-proofing; electronic control packages; cost structures; digital transmission; network cost minimisation; telecommunications networks; telecommunication operations; optical-fibre cables; telephone exchange; world telecommunication economics

Subjects: Telecommunication applications