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Death of EU Broadband Funding to Boost 4G and WiFi Mobile Alternatives

Tuesday, Feb 26th, 2013 (9:14 am) - Score 880

Telecoms analyst firm Point Topic has suggested that internet access solutions which attract a low marginal cost, such as Mobile Broadband, Satellite and WiFi, are now likely to play a bigger then expected part in the UK and Europe’s strategy for expanding broadband coverage into rural areas.

The primary reason for this conclusion is the recent loss of about €8bn in funding for broadband infrastructure projects from the Connecting Europe Facility (CEF), which was wiped out during controversial efforts to slash the EU’s budget between 2014 and 2020 (here).

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But according to Oliver Johnson, CEO of PointTopic, the loss of this funding means that Europe will not be able to adopt a “build it and they will come” philosophy for its telecoms infrastructure. Similarly Johnson doesn’t expect member states to suddenly start spending their “separately allocated structural funds on broadband infrastructure“.

On top of that commercial incumbent operators often seek a return on their investment within 3-5 years, which Johnson views as being “not ideal for large, long term, expensive infrastructure projects“. As a result many projects will need to find a way of doing more for less.

Oliver Johnson, CEO of PointTopic, explained:

Top of the list is for policy makers is coverage and availability for as much of the population as they can manage. Not only do people need to have access to basic broadband, they need to be able to afford it and be able to use it. Then comes getting higher and higher bandwidths to those who want it.

It’s going to be hybrid Europe going forward as local conditions require local solutions and one size definitely won’t fit all.”

But “some form of central intervention” will still be required to make it work and one example of this is the coverage obligation that Ofcom and the government have built into their recent auction of 4G based Mobile Broadband spectrum (800MHz and 2.6GHz), which was incidentally picked up by O2 (here).

Europe’s Digital Agenda expects 100% to have access to 30Mbps+ services by 2020 (50% must also be within reach of 100Mbps+). On top of that everybody is also supposed to gain access to basic broadband (0.5-4Mbps) by 2013. But achieving the 2020 target could now be much more difficult, while others fear that we risk spending less to adopt solutions that aren’t future proof.

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Point Topic has generated various maps of broadband coverage across the EU27, and forecasts of demand and take-up to 2020. The group estimates that the cost to drive deployment and take-up of superfast broadband to 100% of the EU27 by 2020 would be €96.8 billion for fixed Fibre to the Home (FTTH), €10.6 billion for LTE (4G) or €7.8 billion for satellite (at present satellite is only really viable for “basic broadband”).

Mark-Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and .
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