Why 9.2 Is the Magic Number

2:20 PM That's €9.2B earmarked for broadband stimulus investment

October 4, 2012

2 Min Read
Why 9.2 Is the Magic Number

2:20 PM -- Among the hot topics to be debated at the upcoming Broadband World Forum show in Amsterdam, expect the European Commission 's commitment to invest €9.2 billion (US$12 billion) in 2014-2020 to stimulate the development of high-speed broadband access networks and regional digital services to feature prominently.

Not just because it's a lot of money but because everyone -- service providers and systems suppliers alike -- will be wanting to know how it will be handed out and whether they can get a slice of the action.

As part of the broader Connecting Europe Facility (energy and transport as well as digital infrastructure), the EC is hoping that its digital stimulus money will be the catalyst for investments in broadband and service-enablement infrastructure from private and other public sources of at least €50 billion ($65 billion). In turn, this would help the EC reach its ambitious broadband penetration targets and stimulate jobs. (See Brakes Stuck on Europe's FTTH Ride.)

So the EC's money (in the form of equity, debts or grants) will be the seed money to attract further investment in projects. In addition, the EC plans to evaluate projects "on the basis of their ability to contribute towards a digital Single Market" in the European Union.

And that means? "The money would be used to promote pan-European interoperability and meet the costs of linking up existing, often national, infrastructures and of running dedicated European-level components of digital service infrastructures."

That makes me, at least, think of the development of regional cloud services, a major political, regulatory and organizational challenge. Maybe the EC, too, has been thinking of that because it has been working to smooth out cloud service development challenges, specifically with efforts to introduce regional standards to promote interoperability and cross-border cooperation. (See Commission Launches Cloud Strategy.)

The efforts of the EC's Digital Agenda team are admirable, but key challenges and details are yet to be uncovered, as the EC will need to articulate to interested companies what the specific Connecting Europe Facility goals are, what sort of projects meet the criteria and what sort of ongoing assistance (for example, helping to source additional investment) might be available.

Hopefully we'll all find out a bit more in the Dutch capital when Neelie Kroes, the EC's vice president responsible for the digital agenda, gives a keynote presentation on Oct. 16, the first day of the show.

Let's hope all the money gets allocated and that it can deliver at least some of the related benefits that Kroes and her colleagues have pinpointed -- goodness knows Europe needs anything that will stimulate investment and create jobs.

— Ray Le Maistre, International Managing Editor, Light Reading

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