& cplSiteName &

Europe's Broadband Nightmare

Ray Le Maistre
2/11/2013
50%
50%

Neelie Kroes, the European Commission's vice president responsible for the digital agenda, has spent the past few years developing and sharing her dream -- a dream that involved helping Europe to fulfill its potential through the construction of broadband and supporting IT infrastructure. On Friday, Feb. 8, that dream was shattered by a group of short-sighted, bickering, political Neanderthals, including U.K. prime minister David Cameron. Kroes, a determined and articulate individual, was the driving force behind the Connecting Europe Facility, a proposed €50 billion (US$66.9 billion) investment plan for the upcoming 2014-2020 European Union budgetary period that included a €9.2 billion ($12.3 billion) pot for seed investments in high-speed broadband access and digital services projects. Those projects, in turn, were set to help the region go some way toward reaching the ambitious broadband connectivity targets set out by Kroes, who (quite rightly, in my view) sees a positive correlation between broadband infrastructure investment and economic growth potential. You can read about that facility, and the way it was intended to function, in this blog from October 2012. But, following EU budget negotiations held late last week, that €9.2 billion is now just €1 billion ($1.34 billion). Kroes is putting on a brave face, as this EurActiv article and this blog by Kroes show. But it would seem that, with only a fraction of the expected catalyst funds now available for the coming seven years, Kroes has decided that the remaining facility isn't enough to tackle the region's broadband investment requirements, and so will try to salvage some of the digital services potential. Kroes had hoped that by providing seed funding, the Facility would encourage private investment in high-speed broadband access networks. Now that seed funding has disappeared, will private capital be pumped into European fiber-to-the-home/building/curb rollouts? While it's impossible to say, it's obvious that there will be less investment overall. And that will be damaging to the regional and individual EU member economies and further strengthen the grip that incumbent telcos have on high-speed broadband markets. That, in turn, will affect the development of the digital economy in Europe and harm the region's potential for attracting international investment in the form of corporations setting up operations in Europe: Multiple countries in Asia/Pacific, including China, will increasingly look far more enticing as locations for global business operations. Broadband, then, has been identified as little more than a pawn in the political chess games of Europe's senior politicians, who all talk about wanting to stimulate growth and attract investment but clearly fail to see how best to achieve those aims. All they seem to care about is being seen to get their own way while being somewhat oblivious to the medium- and long-term impact of their short-sighted decisions. Europe has shot itself in the foot by targeting the Connecting Europe Facility funds to meet its austerity targets and it's hard to see how the next generation of Europeans won't pay the price for what is a mindless act of industrial self-harm. — Ray Le Maistre, International Managing Editor, Light Reading

(13)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Page 1 / 2   >   >>
brookseven
50%
50%
brookseven,
User Rank: Light Sabre
2/13/2013 | 2:23:52 PM
re: Europe's Broadband Nightmare
Ray,

There used to be lots of studies around Teledensity and Economics. -áAnybody know of any on BB and Economics?

seven
Ray Le Maistre
50%
50%
Ray Le Maistre,
User Rank: Light Sabre
2/13/2013 | 7:07:27 AM
re: Europe's Broadband Nightmare
Suffice to say that I disagree with the premise of your argument - I believe anything that would stimulate investment in high-speed broadband, especially for those that won't be served by the publicly-listed telcos/cable operators, is VERY compelling as it would open up new business and personal opportunities for everyone connected to what will become a hosted/online/Web-based global economy.

I am not disputing, by the way, that Kroes in not an elected politician -- I believe this is to her advantage, as this allows her to focus on the needs of all and not be self-serving.-á
Many Tits Up
50%
50%
Many Tits Up,
User Rank: Light Beer
2/12/2013 | 2:56:50 PM
re: Europe's Broadband Nightmare
The author ignores that Neelie Kroes is not accontable to the EU citizens while also ignoring that those pesky politicians ARE accountable to their constituents.-á In the absense of a compelling idea or a massive fail, there is no reason that national politicians should give way to such missives from the EU.-á Such schemes are only given up in order to rationalize the EU bureaucracy.
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
2/12/2013 | 2:52:03 PM
re: Europe's Broadband Nightmare
Ray -- Doesn't the problem lie more with those public companies that are afraid of shareholder reaction than with a bureaucratic construct of dubious value? You often write about one operator that fancies itself a world-class incubator for digital content. Shouldn't that operator and others like it be focused on building the infrastructure that will carry that digital content?
Ray Le Maistre
50%
50%
Ray Le Maistre,
User Rank: Light Sabre
2/12/2013 | 11:12:07 AM
re: Europe's Broadband Nightmare
Hi 186k
You say: "It's not as if just because the EU doesn't get it's broadband fund that investment in broadband across Europe is going to grind to a halt"

Which "investment in broadband across Europe" is this? The major problem for Europe, as I see it, is that there is precious little investment across Europe is high-speed broadband (fiber to the home/building) -- it is a market that needs seed funding and incentives to encourage any investment at all.

With the broadband funds cut at the EU, the market stays where it is, which, for the most part, means that the major telcos (all of which are constraiend by the pressures of being publicly-listed companies that don't want to scare away shareholders and be seen to up their capex in anything other than 4G) will decide where and when FTTX investments will be made, and that's not going to be enough to make Europe competitive.

London hosts the FTTH Council Europe event next week where there will be plenty of updates about the state of next gen fixed broadband rollouts in Europe -- and guess what? The updates are going to be depressing.-á

Europe's digital/broadband economy needs all the help it can get from any quarter -- Europe's politicians just relegated 21st century communications to the bottom of the investment pile. And that tells us a lot about Europe and the people that we have the misfortune to have running the show.-á
Gabriel Brown
50%
50%
Gabriel Brown,
User Rank: Light Sabre
2/12/2013 | 10:22:28 AM
re: Europe's Broadband Nightmare
That was my sort of my reaction too. There must be spending they could have cut from-áthe budget that delivers less return than broadband.
186k
50%
50%
186k,
User Rank: Moderator
2/12/2013 | 10:16:47 AM
re: Europe's Broadband Nightmare
I find it difficult to get too exercised about this. It's not as if just because the EU doesn't get it's broadband fund that investment in broadband across Europe is going to grind to a halt

I assume this funding was primarily targeted at the hard to reach rural areas where operators generally can't make a return without public subsidy of some sort. So this means we have less funds for rural broadband but there are clearly far fewer premises in rural areas so the overall impact is really quite minor. In addition, all the countries have existing plans which mix commercial & gov backed rollout which weren't dependent on EU funds. For instance in the UK the BBUK is fully funded and not dependent on EU funding at all

So overall, yes it would have been better to cut the funds from some of the other massive low hanging fruit (e.g., CAP) rather than broadband, but better some EU cuts than none and Europe has bigger problems than patchy rural broadband

Gabriel Brown
50%
50%
Gabriel Brown,
User Rank: Light Sabre
2/12/2013 | 10:06:27 AM
re: Europe's Broadband Nightmare
Serious question: I agree that Europe needs investment in broadband, but why would-áthe European Commission be a good vehicle to administer it?

Flippant-áobservation: It's not like it has an amazing record on, say, fishing, or beef lasagne, or administration in general?
Ray Le Maistre
50%
50%
Ray Le Maistre,
User Rank: Light Sabre
2/12/2013 | 8:36:56 AM
re: Europe's Broadband Nightmare
Unfortunately, that is the dilemma. Even if I were to take a plane out of Europe, where would I go? You may be right about Australia - let's see if that's working out in a few years.
There are pockets of Europe where local decisions have been made on high-speed broadband already eg Lithuania and the Netherlands, but the majority of the region is hamstrung by this political shortsightedness.

I thought Kroes had as good a model as any - EU seed money for FTTX projects that could then attract private investment, coupled with investments in regional IT/cloud infrastructure and the development of regional regulations on the management and delivery of hosted/cloud services. 'Joined-up thinking' is how some people describe it. Now she has to rethink -- the decision does not auger well for Europe though. -á
brookseven
50%
50%
brookseven,
User Rank: Light Sabre
2/11/2013 | 5:51:48 PM
re: Europe's Broadband Nightmare
1. If you take a bus out of Europe....that leads you to ME/Africa and potentially Asia. -áAnd the bits of Asia you hit first will not have great connectivity :)

2. -áWhat do you desire as an access plan? -á

I stand by my assertions that future expenditure in access is either government or competition based. -áOutside of wireless nobody is doing very much in either vein (except maybe the Aussies).

seven
Page 1 / 2   >   >>
More Blogs from EuroBlog
Having taken a breather from its acquisition spree in the US, Zayo could kick-start some infrastructure consolidation action in Europe
Some good news for its Finnish parent – Nokia Siemens Networks is on a margin roll
Telefónica to boost its broadband lines in LatAm with DSL management the from ASSIA
According to the value of Nokia's takeover deal, Nokia Siemens Networks is worth less than $5B
As APAC and North America forge ahead, Europe seems stuck in yesteryear
From The Founder
Kicking off BCE 2017, Light Reading founder Steve Saunders lays blame for NFV's slow ramp-up and urges telecom to return to old-fashioned standards building and interoperability.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Interviews
CenturyLink: Let's Get Past SD-WAN Hype

6|23|17   |   04:02   |   (0) comments


Technology becomes a "shiny object" unless it's properly focused on solving business needs for enterprise customers, says Bill Grubbs, network solutions architect for CenturyLink. He explains to Light Reading why SD-WAN deployments have to be tailored to specific needs – and more.
Women in Comms Introduction Videos
Infinera's Sales Director Paints Tech's Big Picture

6|21|17   |   4:14   |   (1) comment


Shannon Williams, Infinera's director of sales, shares how she achieves work's many balancing acts -- between her role and the broader company, today and tomorrow's tech and more.
LRTV Custom TV
SD-WAN Innovation & Trends

6|20|17   |     |   (0) comments


Versa CEO Kelly Ahuja discusses with Carol Wilson the current status and trends in the SD-WAN market, Versa's innovation around building a software platform with broad contextualization, and the advantages that startups can bring to the SD-WAN market.
LRTV Interviews
Ovum's Dario Talmesio on 5G in Europe

6|20|17   |   02:16   |   (0) comments


At 5G World 2017, Dario Talmesio, principal analyst and practice leader on Ovum's fixed and mobile telecoms European team, explains the emerging trends amongst European operators as they prepare for 5G.
LRTV Custom TV
Putting Power on a Pedestal

6|19|17   |     |   (0) comments


ARRIS's John Ulm says a major accomplishment of SCTE•ISBE's Energy 2020 program is increased focus on power cost and consumption, including inclusion of energy requirements in operators' RFPs and RFIs.
LRTV Custom TV
Gigabit Access: The Last-Mile Pipe for All Future Services

6|19|17   |     |   (0) comments


A Gigabit access platform being deployed today must be able to deliver all types of services to an increasing number of devices. A non-blocking architecture is necessary to support the ever-increasing growth in bandwidth demand. The Huawei Gigabit access solution is based on a distributed design that is fully scalable to deliver a unprecedented performance.
LRTV Custom TV
Key Factors to Successfully Deploy an SD-WAN Service

6|19|17   |     |   (0) comments


As service providers transition their SD-WAN solution from trials and limited deployments into production at large scale, there are important considerations to successfully operationalize these solutions and realize their full potential, without adding complexity, introducing uncertainty or disrupting current business operations. Sunil Khandekar, CEO and Founder ...
LRTV Custom TV
IoT Solutions: Rational Exuberance

6|19|17   |     |   (0) comments


IoT solutions are morphing from hype into viable business opportunities. Huawei has the platform and ecosystem support to help carriers successfully address new business opportunities in the IoT space.
LRTV Custom TV
Realizing ICN as a Network Slice for Mobile Data Distribution

6|19|17   |     |   (1) comment


Network slicing in 5G allows the potential introduction of new network architectures such as Information-centric Networks (ICN) as a slice, managed over a shared pool of compute, storage and bandwidth resource. Services over an ICN slice can benefit from many architectural features such as Name Based Networking, Security, Multicasting, Multi-homing, Mobility, ...
LRTV Interviews
Ovum's Mike Roberts on 5G Uptake

6|19|17   |   04:08   |   (0) comments


Mike Roberts, research director for Ovum's service provider markets group, explains why he has boosted his 5G subscriptions forecast.
LRTV Interviews
AT&T's Hubbard on Intersection of SD-WAN & MPLS

6|15|17   |     |   (0) comments


Rick Hubbard, SVP of Network Product Management for AT&T Business Solutions, discusses how AT&T's approach to SD-WAN fits in with its overall virtualization strategy, explains how SD-WAN can improve enterprise customers' use of the cloud and addresses the intersection of SD-WAN and MPLS.
Telecom Innovators Video Showcase
Keep Connected IoT Devices Under Control With Allot

6|15|17   |     |   (0) comments


Allot AVP of International Pre-Sales, Daniel Keidar, explains how communications service providers can protect infrastructure and service availability from flooding attacks caused by malfunctioning or bot-infected devices connected to their network.
Upcoming Live Events
October 18, 2017, Colorado Convention Center - Denver, CO
November 1, 2017, The Montcalm Marble Arch
November 1, 2017, The Montcalm Marble Arch
November 30, 2017, The Westin Times Square
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Netflix's Lesson in Culture Expectation Settings
Sarah Thomas, Director, Women in Comms, 6/21/2017
Kalanick Steps Down as Uber CEO
Sarah Thomas, Director, Women in Comms, 6/21/2017
BT Tech Chief Makes Plea to 5G Chip Vendors
Ray Le Maistre, International Group Editor, 6/20/2017
Buy American: Will It Affect the Telecom Sector?
Dan Jones, Mobile Editor, 6/21/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Following a recent board meeting, the New IP Agency (NIA) has a new strategy to help accelerate the adoption of NFV capabilities, explains the Agency's Founder and Secretary, Steve Saunders.
One of the nice bits of my job (other than the teeny tiny salary, obviously) is that I get to pick and choose who I interview for this slot on the Light Reading home ...
Animals with Phones
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.