No cash for broadband: Europe's super-fast future torpedoed by budget cuts

Summary:'No new broadband investment,' says Europe's digital chief - the market will have to do the legwork in expanding broadband coverage now. Still, at least there's some funding left for e-invoicing.

With negotiations over the EU's budget for the next seven years now concluded, the continent's broadband looks to have been the loser.

Discussions over the budget for the rest of the decade were wrapped up in Brussels on Friday, with the EU's member states agreeing a cut to Europe's 'payment ceiling' from €942.8bn in 2007-13 to €908.4bn in 2014-2020.

One of the areas to suffer as a result of the cut is Europe's broadband infrastructure. The initial budget proposed by the European Commission would have seen €7bn devoted to broadband networks  and €1.2bn to digital services. The money would have come from a budget of €40bn destined for the Connecting Europe facility, a fund intended to foster "smart, sustainable and fully interconnected transport, energy and digital networks".

Under the budget now agreed by European leaders, that fund has now been cut to €29.3bn, with only €1bn to go on ICT and digital projects.

Europe's digital commissioner Neelie Kroes pronounced herself "disappointed" by the cut, and said that as a result of the reduced funding, the facility cannot now finance broadband projects.

"Such a smaller sum does not leave room for investing in broadband networks. I regret that: because broadband is essential for a digital single market, the rails on which all tomorrow's digital services will run; and this could have been an innovative and highly market-oriented way to deliver it, almost budget-neutral in the long run," Kroes said in a blog post on Saturday.

"Such a smaller sum does not leave room for investing in broadband networks. I regret that" — Neelie Kroes

The Commission has a stated goal of seeing at least half of Europe's population subscribing to broadband packages of 100Mbps and 30Mbps available to all by 2013 — and Kroes says it will still aim to meet that figure even without the fund.

"Those agreed objectives are now harder to reach, but we should stay focused on that goal... The Connecting Europe Facility was an important tool to move towards that goal, but not the only one," she said, adding the European Investment Bank's additional €10bn of capital, announced earlier this year, could be used to aid the financing of broadband projects.

The €1bn that remains for digital services from the Connecting Europe facility's funding will be used for "digital service infrastructure" like e-invoicing and e-procurement.

Topics: Broadband, EU, Fiber, Telcos

About

Jo Best has been covering IT for the best part of a decade for publications including silicon.com, Guardian Government Computing and ZDNet in both London and Sydney.

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