Hungary’s network in a world of increasing capacity requirements

20. 10. 2022.

A brief history of the Internet

Communication and the desire to make it happen as quickly as possible, is as old as humanity. The internet has made it faster and easier. With a click of a button, our thoughts can be shared with infinite amount of people, anywhere in the world. But where does all this come from?

The first online connection was established in 1969 between the computers of the University of California and the Stanford Research Institute in the United States. The solution, originally developed for military purposes, was then made available for everyday purposes as well. Once the “genie was out of the bottle”, it began to spread unstoppably, and a new way of rapid communication reached a wide audience. It had to wait until 1991 to gain popularity, but the real leap forward came in 1996, when nearly 500 domain names were already used in the country.

The number of fixed broadband subscriptions, i.e. download speeds exceeding 144 Kbps, is constantly increasing year by year, and users are demanding more and more Internet capacity. The figure clearly illustrates that the number of subscriptions per 1,000 people has continuously increased over the past two decades. We are close to the European average¹ and this also shows that there will be an increasing demand for optical developments in the future.

The structure of the network

Users connectionw to the national network happens through several levels: the top aggregate is the backbone network, which connects larger towns/cities to form a central optical network that collects the data traffic of the upstream networks. Its domestic end terminates in an international data exchange centre. In the backbone network, the backhaul network connects the settlements and is based on optical wire, but there are also wireless solutions (mostly microwave), with national coverage provided by only a few large market or state-owned operators. The lowest level of the basic infrastructure is the access network, which provides connection between the service node interface and the user interface.

Wired or wireless?

One solution for the access network is wired broadband. xDSL‘s technologies, based on a traditional wired network designed for analog voice transmission, create Internet access with a pair of copper wires (ADSL, VDSL). In Hungary, this has a well-established network, but has limited capacity. The overall number of fixed Internet subscriptions is increasing year by year, while the number of subscriptions to xDSL networks is decreasing.

In the case of HFC (hybrid fibre-coax) technologies (DOCSIS 1.0, 2.0, 3.0 and 3.1), light pulses from the service provider via optical cables are converted into an electrical signal by an optical node, and the electrical signal is then transmitted via coaxial cable to the point of demand. In terms of network solutions, DOCSIS 3.1 proves to be the best among those available to the public. It is a standard capable of nominal download speeds of 1000 Mbps and upload speeds of 100 Mbps. DOCSIS 4.0, currently under development, promises 10 Gbps download and 6 Gbps upload speeds.

Most FTTx technologies transmit data over fibre-optic cables. From these solutions, FTTH (Fiber To The Home) offers the highest capacity – up to symmetrical gigabit or higher data rates. In terms of speed, the next best solution is FTTB (Fiber To The Building), where the optical wire is transported to a multi-apartment building and then to individual apartments using other cable types such as Cat5e Ethernet cables. The third typical solution is the FTTC (Fibre To The Curb) Ethernet fibre optic solution, which reaches the public area with fibre optic deployment and then the places of need of interest with Ethernet cable.

Wireless broadband can be either nomadic (non-mobile, location-independent transmission, but with fixed deployment) or mobile (where the user can move at a higher speed).  Authorised nomadic microwave technology can be deployed quickly and provides high availability. In the case of wireless access, the most common solution in Hungary is WLAN 5 GHz technology. It can be built up to the base stations with optical cable (FTTA) or without (nonFTTA). Other wireless solutions can only be found sporadically in our country today (for example, satellite VSAT technology or a fixed LTE Internet connection). In mobile-based technology, 5G networks are the latest generation of networks, standardised to deliver maximum download speed up to 20 Gbps and upload speed up to 10 Gbps in lab conditions. The technology offers much lower latency and a more stable network. In Hungary, 5G is still under development, but the 4G networks of most service providers cover the entire country.

Estimated capability of networks

The data transmission capacity of each technology, according to our knowledge of the market in 2021, is shown in the chart below.

Offered download and upload speeds

New times, new concepts

In Hungary, the coverage of New Generation Access (NGA) networks is average among EU Member States, but exceeds the EU average in the category of rural settlements. In terms of optical access network coverage, Hungary performs above the European average in both highly urbanised and low population density areas.

The most advanced access network solutions are technologies that meet the requirements of the VHCN (Very High Capacity Network). According to the definition of BEREC (Body of European Regulators for Electronic Communications), VHCN is defined as networks capable of delivering data rates of at least 1000 Mbps in the download direction and 200 Mbps in the upload direction at peak times, using optical wire for multi-dwelling buildings. In the case of wireless networks, it is necessary to reach the base station via an optical cable and ensure a speed of at least 150 Mbps in the download direction and at least 50 Mbps in the upload direction. Improving the technological access to the VHCN has been identified as a priority objective in our country.

In Hungary, it is a fundamental goal that the largest percentage of the domestic network meets the definition of the VHCN, and the development of SA 5G (Standalone 5G) networks has also received strategic support. This mobile network standard has features, a stable network and low latency, that meet the VHCN requirements. The goals of the European Union are in line with the domestic plans: by 2030, in all European cities, all EU households must have access to the gigabit networks and 5G coverage.  If we look again at the offered download and upload speed, it is clear that, in principle, the only solutions capable of providing VHCN connectivity in our country are FTTH, FTTB and FTTA WLAN.

VHCN coverage in Hungary could be at a maximum level of 50%. Developments for a “future-proof” network are therefore necessary for both residential and non-residential customers. According to NMHH data, the number of customers with access to 100 Mbps or below, has been decreasing every quarter of the year since 2018 in Hungary.

The importance of a future-proof network

Our lives are increasingly affected by the digital lifestyle, a significant part of our work and private life requires network access. As a result of the COVID-19 pandemic, among other things, the number of telecommuters in Hungary has increased, which requires a strong national network infrastructure. With the development of the ICT service sector and the rise of digital work, there is an increasing need to secure residential and non-residential network needs, which requires a technology that ensures high data traffic. Continuous provision of network access for companies, high-quality audio and video transmission of online meetings, and their maintenance for hours emerged as a basic need with the spread of remote and hybrid working. These activities are also placing increasing pressure on residential and non-residential network capacity.

In 2020, the data traffic of mobile networks increased by 9% compared to the previous year, which is not only due to the digital+ization of employment: the consumption habits and leisure activities of the Hungarian population are increasingly linked to network services. In the fourth quarter of 2021, 6 million people accessed the Internet via their mobile phone and used it to browse, send messages and access social media. The number of online orders and purchases has also increased. The increased residential use does not only strain the capacity of the networks from the user’s side: the demand has also appeared on the service provider’s side to be able to provide a better, faster and more reliable service.

And with the spread of digitalization, the need for capacity increase will become more and more important, and technologies that meet the requirements of the VHCN can provide the solution.

Authors of the article: Bálint Kapcsos, Géza Schneider

* ^{eNET_Kft., “News network access survey,” 2022, pp. 37-38}