As policymakers drive fiber deployment within buildings, passive optical LAN provides an attractive solution

Introduction

There is a growing push within Europe to deploy fiber not just to buildings but also within them. This is evidenced by the Gigabit Infrastructure Act, which became generally applicable across EU member states in November 2025. The Act ensures that all new buildings, or those subject to major renovation works, should be equipped with physical infrastructure and in-building fiber wiring to enable end users to receive Gigabit speeds. While some countries, such as Spain, already had obligations on fiber rollout within multi-dwelling residential properties, such obligations now extend to different types of buildings, such as hotels, hospitals, and buildings in the education and cultural sectors.

The fact that new and renovated buildings will come equipped with in-building fiber wiring is significant because this can then serve as the basis for bringing fiber to all corners of the property. For example, if fiber has been deployed to all the floors of a hotel, this can then facilitate connecting individual guest rooms within the property with fiber. As a result, users of such buildings can enjoy the benefits of fiber and the multi-Gigabit bandwidth and high reliability it can provide.

Passive optical LAN offers flexibility, scalability, sustainability, and simplicity benefits

As property owners take advantage of the new in-building regulations, fiber cabling can easily be extended throughout the building. Traditionally, operators have used Ethernet LANs, but as the regulatory landscape evolves and fiber is increasingly deployed in buildings, the value of passive optical LANs grows ever clearer.

One benefit of passive optical LANs is their scalability and flexibility. There are limitations to the bandwidth that Ethernet cabling can provide, and as Wi-Fi 7 becomes more commonplace, it could drive the need to upgrade existing CAT6A cabling to support higher speeds. Wi-Fi 7 may require four CAT6A cables to deliver up to 40Gbps. Instead of a continual, repeat process of replacing and augmenting Ethernet cabling as bandwidth demands grow, building owners can install fiber cabling with a single fiber cable delivering up to 50Gbps capacity today. Speeds will also continue to increase over time without the need for upgrades to the fiber. Passive optical LAN also provides considerable deployment flexibility because PON networks offer a reach of many kilometers, enabling rollouts across very large campuses.

In Europe, building owners are increasingly interested in the green credentials of their properties. As a result, the 40% or so in energy savings from using a passive optical LAN rather than an Ethernet LAN are increasingly salient. In this context, passive optical LAN rollouts are important because they can boost Building Research Establishment Environmental Assessment Method (BREEAM) scores. BREEAM is a method for assessing the sustainability of the built environment and infrastructure, and better BREEAM scores can help enable tax incentives for building owners. As higher energy costs have become a greater focus in Europe in recent years, the energy cost savings that passive optical LAN can deliver are also increasingly significant.

Passive optical LAN rollouts also offer efficiency and simplicity, including reduced space requirements. Less equipment is needed on the different floors of the building, which could deliver supplemental benefits for building owners. For instance, in a hotel, the space freed up by passive optical LAN could be utilized for additional guest rooms. Ethernet LAN deployments also face challenges because, as cabling is upgraded to accommodate increased bandwidth demands, the resulting lack of space in conduits may constrain subsequent upgrades. In addition, passive optical LANs offer simplicity and efficiency benefits because they use PON architectures, which reduce the number of active devices required compared to Ethernet LAN alternatives.

Passive optical LAN deployment numbers are already significant and poised for further growth

As policymakers place a growing emphasis on in-building fiber infrastructure, and the advantages that passive optical LAN deployments offer over Ethernet LAN alternatives become increasingly crucial, passive optical LAN rollouts are growing in number. One indication of this is the reported number of passive optical LAN deployments by Huawei (Figure 1).

Importantly, these deployments span a wide range of verticals (Figure 2). This demonstrates that the advantages of passive optical LANs in terms of scalability, flexibility, sustainability, and simplicity resonate across a wide range of building owners. This broad spectrum of rollouts across different segments is also vital because it helps foster knowledge, awareness, and best practices for deploying passive optical LAN for the specific circumstances of building owners across diverse verticals. This can help create a virtuous cycle that reinforces the value of deploying passive optical LANs across a wide range of verticals.

Summary: Passive optical LAN is primed for further acceleration in growth

Overall, we expect passive optical LAN rollouts to continue to increase, with growth accelerating across a diverse range of segments. The advantages of passive optical LAN are compelling for many building owners, and there is also a growing recognition amongst policymakers of the value of deploying fiber within buildings.

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