EC Announces Action In Broadband Rollout

by Ulrika Lomas, for LawAndTax-News.com, Brussels

23 March 2006

The European Commissioners for Information Society and Media, Competition, Regional Policy and Agriculture and Rural Development on Tuesday jointly presented a communication entitled “Bridging the Broadband Gap”.

The Commission stated that it considers wide broadband coverage in Europe as crucial for fostering growth and jobs in Europe, and argued that this is why EU telecoms legislation, structural and rural policy instruments need to be mobilised in full respect of state aid rules in a joint drive to bring high-speed “broadband” internet access to all Europeans, in particular to the EU’s less-developed areas.

“Broadband internet connections are a prerequisite for e-business, growth and jobs throughout the economy. Competition and open markets are certainly the best drivers of broadband in the EU," explained Viviane Reding, Commissioner for Information Society and Media. She added:

“However, broadband connections must not be limited to the big cities. If the EU and its 25 Member States make a clever use of all policy instruments, broadband for all Europeans is certainly not out of reach by 2010. But the time to act is now.”

Competition Commissioner Neelie Kroes underlined the importance of EU state aid rules in this respect:

“Deployment of broadband may be hampered by market failures in rural and remote areas. In such cases, well-targeted state aid may therefore be appropriate, e.g. in the form of public private partnerships to support the construction of open networks. But we have to make sure that state aid does not crowd out private initiative, nor distort competition to an extent contrary to the common interest.”

Rapid progress in broadband take-up across Europe in the past three years can largely be ascribed to a combination of competing infrastructures and effective telecoms regulation, according to the communication.

The broadband penetration rate at the end of 2005 was estimated at 13% of population or about 25% of households, reaching almost 60 million lines throughout the EU. However, despite fast growth, broadband has yet to reach some of the EU’s less-developed areas because of low and uncertain returns on investment.

To accelerate the roll-out of advanced broadband communications in Europe, the Commission this week proposed two main strands of action:

• Strengthening national broadband strategies, which should set clear targets and reflect regional needs, including a strategic approach to making use of EU and national funding in less-developed or rural areas;
• Stepping up the exchange of best practices, in particular by the setting up of a website that will act as a single meeting point for local authorities and industry players to exchange information and gather experience.

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