Europe to fall short for next generation broadband coverage

A view of European broadband in 2020

It's well known that some markets are struggling to provide broadband coverage. Here we take a closer look at the end of the decade.

Point Topic’s most recent work on broadband coverage and take-up in Europe has reinforced the expectation that the EU28 will not be able to meet all Digital Agenda targets.  The resolution to make 30Mbps available to all businesses and citizens will be broken.

Even being optimistic, we expect more than 10 million premises will be outside the footprint of next generation access technologies by 2020.  It is very unlikely given the progress to date and the published plans of the member states that fixed solutions in particular will provide solutions in these areas.

Fixed is not the only fruit

One of the original goals of the Digital Agenda was basic broadband coverage for all at 2Mbps downstream by the end of 2013.  This target was achieved, at the last minute, by the European Commission’s recognition of the contribution of satellite broadband.

Rural areas, which were the ones left behind, are always more challenging to provide with a fixed supply in particular and satellite offers the perfect solution where there is low density of demand. However even in 2013 satellite operators were not encouraged to expand their private investments.

There simply were not enough satellites to cope with the 50 million or so premises that could – in theory – have subscribed at the time.  ‘Luckily’ there was and still is insufficient public awareness and political support for satellite broadband so it’s understandable that the industry didn’t rush to order new space capacity.

Raising awareness but not bandwidths?

An element of the recognition of the contribution of satellite was the creation of a joint web-based tool with the EC listing all satellite broadband ISPs in every EU Member State – www.broadbandforall.eu – which helps users connect with their local suppliers.

This sort of initiative may well put the satellite suppliers ahead of others in the fixed arena in particular when it comes to single digital markets as well as providing ‘evidence’ that supply is ubiquitous.  However while the EU28 may be reliant on satellite to underpin coverage claims the lack of financial follow through from the EC when it comes to the part that satellite has to play puts the 2020 targets at risk.

Satellite broadband has decent penetration in Europe and with the launch of Ka-band satellites from 2010 onwards it has been able to offer much higher downstream and upstream bandwidths than in the past.  While the Commission’s Digital Agenda target was for ‘basic broadband’ which has typically been defined as 2Mbps downstream, most satellite offerings today offer 6Mbps to 22Mbps download speeds which is still short of DA requirements for 2020.

However, the general sentiment from the satellite industry at this time seems to be that 30Mbps service level agreements will not be possible at any reasonable price level without some intervention.  While the fixed line players and the mobile operators have benefitted from appropriate support and ‘official’ recognition the satellite operators in have seemingly been marginalised.

State aid documentation for example generally refers to next generation solutions as ‘wired’ and much of the early zeal in the EC for a fibre only solution to the Digital Agenda still echoes through the thinking, advice and allocations that constitute central guidance and subsidy.

So we arrive at a paradox.  Satellite operators cannot and will not expand their capacity to meet the targets of the local country members and the EC itself given current funding policies.  The EC and most member states won’t meet the 30Mbps coverage for all without satellite operators.

A simple solution would be of course that the institutions contribute with an adequate level of financial support to the effort of satellite operators to immediately cover rural & white areas; noting after all that 30Mbps is their political target and not one the market calls for.

We’ll see…

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