Europe's Broadband Nightmare
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