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i2010 strategy

European Countries Leave U.S. Trailing in Race for Universal Broadband

in Broadband Data/Broadband Updates/Broadband's Impact/International/National Broadband Plan/Wireless by

LONDON, March 11, 2010 – European countries are adopting measures to reach 100 percent broadband penetration – and they’re going to reach that goal well before the United States.

This is partly because European regions tend to be more densely populated, often with shorter distances to their remote communities. Some have fewer topographic challenges than others, making it easier to bring broadband to all homes.

However, in many cases Europeans are benefiting from firm commitments from local and central governments that began as many as 10 years ago.

Such commitment led Finland to become the first European country to legislate for universal broadband in October 2009, requiring telecommunications firms to provide residents with access at 1 megabit or more by July 2010.

By December 2010, each region will have a telecom firm subject to a Universal Service Order, as defined by the European Union in its i2010 strategy to heal the digital divide among its member states. Others are following Finland’s move. Austria set a target of 25 mbps for its residents by 2013, aiming to achieve this through legislation stimulating wholesale provision and cooperative ventures between operators.

Universal provision is certainly far easier for some countries to provide than others. Finland was well placed since 96 percent of its people were already within reach of broadband by 2005.

Some, including the United Kingdom and the Netherlands, now have virtually 100 percent coverage anyway, compared with 98.5 percent in France, 95 percent in Germany, and just 82 percent in the United States, according to a report (pdf) from the Organization of Economic Cooperation and Development.

This same report also highlighted the problems comparing broadband coverage in different countries given the variety of service types and definitions. The report defined broadband as being 500 kbps or faster downstream, but that itself looks like an outdated measure given that it’s woefully inadequate for delivering a growing number of services such as high-definition television.

For most countries, the challenge for universal broadband remains the last mile in remote areas, or might be called the “last 10 percent”, with various measures being adopted.

Finland is leveraging its world-class expertise in wireless, having invested in High-Speed Packet Access (HSPA) technology to cover most of the country by providing up to 21 mbps downstream. This forms part of its highly ambitious plan to step up universal broadband to 100 mbps by 2015.

The United Kingdom also aims to exploit its mobile network, with the emphasis on filling in the gaps to reach the 15 percent of households incapable of receiving 2 mbps or more over their digital subscriber line connections. The United Kingdom also highlights the problem of definition. The OECD says the United Kingdom has 100 percent broadband coverage, but many of its more remotely located citizens would disagree as they struggle to gain access even at 500 kbps.

By contrast, South Korea already provides most of its population with 100 mbps over its fiber-dense networks. This is precisely the FCC’s plan for 100 million homes within the United States, but not until 2020.

Meanwhile, some countries and regions are leaning more heavily on their existing cable TV networks to fill out top-end broadband within populated areas, now that an international telecommunications standard known as the DOCSIS 3.0 cable modem standard supports downstream speeds up to 100 Mbps with the aid of channel bonding. Data Over Cable Service Interface Specification, or DOCSIS, allows the addition of high-speed data transfer to a cable TV system.

Cable networks accounted for about 38 percent of the Netherlands’s 5.996 million broadband connections by Sept. 30, 2000 and was gaining ground over DSL, according to the Dutch telecom journal Telecompaper.

The importance of cable networks for broadband competition has been reflected in some countries by the regulator including them in unbundling programs. Danish telecom regulator National IT and Telecom Agency has ordered the operator TDC to open both its copper and cable networks to other broadband providers.

This Danish move highlights a possible deficiency in the U.S. plan to stimulate competition and price competitiveness. While Denmark, in common with many European countries, has promoted competition between multiple service providers, the FCC’s focus has been more on creating alternative broadband modes of delivery, such as DSL and cable. The trouble with this is that the same operator may provide both, leaving little incentive to price competitively.

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