Europe sets state-aid rules for broadband rollouts

Europe sets state-aid rules for broadband rollouts

Summary: The European Commission hopes the guidelines will give regulatory certainty to operators who are considering rolling out high-speed broadband networks

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The European Commission has published a set of rules for when state aid should be used to roll out broadband networks, in a bid to speed up the deployment of high-speed next-generation networks in the European Union.

The guidelines, announced on Thursday, followed a public consultation. According to competition commissioner Neelie Kroes, the rules will "facilitate the widespread rollout of high-speed and very high-speed broadband networks, enhancing European competitiveness and helping to build a knowledge-based society in Europe".

"We expect to see up to €300bn [£270bn] of investment in both high- and very high-speed European broadband networks in the coming decade," Kroes said in a speech marking the launch of the guidelines. "While this investment should be made mostly by private companies, there is an important role for public investment in achieving the widest possible access to broadband in under-served and non-profitable areas."

Kroes laid out three rules for the use of state aid in rolling out a broadband infrastructure. The first is that where there is no private investment, a public-service network is needed to ensure universal coverage. The second is that aid must only be used to deploy networks in areas that private providers do not find profitable; and the third is that the network must be open to all service providers.

"Public funds are not always needed for public authorities to promote broadband deployment and, in any event, they should not crowd out or delay private investments," Kroes added. "Before granting state aid, public authorities should therefore consider whether they can promote private investments with other means, for instance by co-ordinating civil works and streamlining administrative procedures."

The new guidelines are not only applicable to next-generation access (NGA) — a term that generally refers to fibre access — as they also cover ADSL, cable and Wi-Fi networks. The Commission is still working on a separate draft NGA Recommendation that it hopes will give an indication of what regulators will expect from operators when deploying fibre and other high-speed broadband access.

In the UK, the incumbent operator BT has said it will roll out fibre to 10 million homes by 2012. The company is already trialling various ways of doing this in London, Cardiff and Kent. And in June's Digital Britain report, the government proposed a 50p-per-month levy on fixed lines across the country with the aim of funding the rollout of next-generation broadband to unprofitable areas.

In a statement issued on Thursday, the Commission noted that one of its fundamental concerns is to avoid the re-creation of old monopolies with public support.

"[The new] guidelines contain appropriate safeguards to ensure that any broadband infrastructure funded with public money does not favour [the] existing operator," the Commission said. "A company that receives public monies needs to provide effective open access to its competitors to allow them to compete in an equal, non-discriminatory way."

Topics: Broadband, Networking

David Meyer

About David Meyer

David Meyer is a freelance technology journalist. He fell into journalism when he realised his musical career wouldn't pay the bills. David's main focus is on communications, as well as internet technologies, regulation and mobile devices.

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4 comments
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  • Well we will see...

    "While this investment should be made mostly by private companies, there is an important role for public investment in achieving the widest possible access to broadband in under-served and non-profitable areas."

    Well this is wrong all party's involved should be splitting the cost's especially when these area's are also being levied a 50p surcharge.


    "[The new] guidelines contain appropriate safeguards to ensure that any broadband infrastructure funded with public money does not favour [the] existing operator," the Commission said. "A company that receives public monies needs to provide effective open access to its competitors to allow them to compete in an equal, non-discriminatory way."

    How is this going to be achieved? Id like to see who's getting all the interest's on the levied charges.
    CA-aba1d
  • interesting...

    so..

    funding can only be sought for a "national grid" type solution?

    whereby all operators can use the bandwidth and akin to the BT model, pay the carrier a fee for each connection?

    Does this not mean we end up with the same mess we have now with ADSL?, highly over subscribed carriers looking to get as many people onto them as possible?

    Why don't we do this with mobile phone networks?, force them all to allow transparent roaming.. would fix a load of coverage problems overnight... of course it couldn't work in reality, as with the ADSL "competitive" model, it does not take into account the need for businesses to be independent and to strive to produce a better feed than their competitors..

    with ADSL, if you get 512kbps that's what you will get with ALL ADSL ISP's regardless... where is the incentive there for the ISP's? its a stranglehold.

    Independent providers are going to suffer with no funding because they choose to provide a fast solution to their customers... great plan!
    Kijoma-c5d44
  • Levy may not go-ahead

    I understand the Levy will not make it to the Digital Economy Bill for both legal and political reasons.

    Second what the EU states also makes the USC in the Digital Britain report illegal if government gives money to say the Mobile Operators (as suggested in the report) as their networks are not open.
    petercf
  • makes you wonder

    ...

    do they actually think this over properly?, doesn't bode well for having faith in the competence of those deciding where they throw millions of tax payers revenue..


    no change there then :)
    Kijoma-c5d44