Broadband for Sustainable Development

Ticau NicolaePolicy Officer

European CommissionDG CONNECTBroadband Policy Unit

ICT in growth and jobs

ICT drives 1/3rd EU GDP growth 1995-2007

6% of Gov't R&D is ICT

17% of business

R&Dby ICT sector

ICT sector

4.4%

ICT in Other Sectors

38% EU venture capital is in ICT

17% EU patents are in ICT

HALF of EU enterprises provide mobile devices for business use

311.6 billion EUR turnoverof EU B2C eCommerce (2012)

14% of EU SMEs selling online

DIGITAL BUSINESSICT in Cohesion : ~ 9 %Broadband in CEF : EUR 150mDigital in EFSI : central

29% of EU enterprises uses e-Invoices

28% EU enterprises use Social media

• Basic broadband target achieved in autumn 2013

• Challenges ahead for fast and ultra-fast broadband coverage (30 mbps) and take-up (100 mbps) 2020 targets

• "close to target" in areas such as eGov, internet usage and partly eCommerce

Broadband targetsEU Digital Agenda

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Source: Digital Agenda Scoreboard

Progress

High-Speed Broadband Networks* cover - 62 % of households in the EU (54 % in 2012) - 18 % of households in rural areas

EU Coverage Target : 30 Mbps for all by 2020

* Next Generation Access (NGA) networks: VDSL, Cable Docsis 3.0 and FTTP

4

IT EL HR FR PL IE SK IS EU CZ ES RO BG AT SE FI SI EE DE NO HU CY UK DK PT LV LU LT NL BE MT0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%Total Rural

Next Generation Access coverage, 2013

Source: IHS and VVA

Only 5.3% of Broadband subscriptions have speeds of at least 100 Mbps

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EU take-up Target: 100 Mbps for 50% households by 2020

Need for speed: Trends

Source: Ericsson Mobility Report November 2014

Need for speed: Trends

DAE target by 2020 all Europeans have access to

much higher internet speeds of above 30 Mbps

Case-study – broadband need for small business

Case-study – broadband need for a residential

household

DAE target by 2020 50% or more of European house-holds subscribe to internet

connections above 100 Mbps

Case-study – broadband needs for a 20 classes

school

30

51 58

100

700

Broadband needs Case Studies versus Digital Agenda for Europe targets (Mbps)

Will the BB targets be met?

What is at our disposal:

• Policy initiatives (targets, measurement, DSM)

• Regulatory environment (telecom framework, cost reduction directive, state aid)

• Financial support, including TA (CEF, Cohesion, Juncker Investment Plan)

How can we link these initiatives better?

What can we do to better stimulate demand?

Reduce costs of broadband rollout by 20 to 30% and make it easier

Better use of existing infrastructure and more transparency, incl. cross-utility

Improved coordination of civil engineering

Simplify permit granting process

Buildings ready for access to high-speed internet

BB Cost Reduction: objectives

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Where the market cannot deliver, local, regional, and national authorities can address the investment needs.

• Main EU financing instruments in 2014-2020:

• European Structural and Investment Funds will invest in broadband and other digital networks (estimated €5.7Bn of ERDF)

• Connecting Europe Facility (CEF): complementary EU support (€ 150 Million) by means of financial instruments

• Juncker's Investment Plan

Meeting the targets

Joint EU/EIB support

• CEF financial support cannot take the form of a grant and is currently implemented in partnership with the EIB

• CEF will take part of the investment risk from the financing party, thus improving risk profile for other investors/providers of financing

• Credit enhancement can be done through loans, guarantees or project bonds

• CEF credit enhancement can also be combined with the grants, including grants from the Cohesion policy instruments

CEF technical assistance with the World Bank

• Setting up the legal base of a common TA platform

• TA platform to be active in EU 28

• Potential TA recipients include Managing Authorities, but also local communities

• TA can take the form of feasibility studies, demand analysis, legal screening, financial structuring

The Connected Communities Initiative

• Objective: help local communities preparing projects for bankability assessment (TA)

• Connected Communities is a pre-screening exercise to detect potential projects and feed pipeline building

Results of the first phase

Europe's Investment Plan• a new European Fund for

Strategic Investments, guaranteed with public money, to mobilise at least € 315 billion of additional investment over the next three years (2015 - 2017)

• a credible project pipeline coupled with an assistance programme to channel investments where they are most needed

• an ambitious roadmap to make Europe more attractive for investment and remove regulatory bottlenecks

MS/EIB/COM Task Force

Investment projects proposed by MS (2015-17):

Around EUR 447 billion, including 18% for Digital and Knowledge economy

Pipeline proposed by the Commission (2015-17):

Around EUR 86 billion, including 45% for Digital and Knowledge economy

Investment opportunities, barriers and challenges.

Knowledge and Digital economy include mainly DG CNECT and DG RTD projects. However, some projects of interest for DG CNECT can also be found in other areas (energy, education). High % in COM list due to several tbd amounts for transport and energy

Those figures should be handled with care as several last-minute modifications can occur from the MS

The Member States' pipeline

[

We are launching an investment offensive.

A major new initiative to get Europe growing again and get

people back to work.

President Juncker

Broadband investment guide

• Published on 22 September 2014 - update of the guide to broadband investment published in 2011

• Aims to help local, regional and national authorities to develop long-term broadband development plans

• Lists the investment alternatives when developing broadband • Advises public authorities how to take a long-term investment

perspective when they develop a broadband plan• Provides a list of choices when choosing a type of infrastructure,

an investment model, a financial model and the financing tools available

• Suggests how to involve citizens, collaborate with other broadband developers, neighbouring municipalities and regions, and how to monitor and evaluate broadband investment.

Broadband in

MS

Technologies

Strategy&Policy

Guide for

Municipalities

Business

Models

Financing&

Funding

Best Practices

Broadband Industry

Citizens

Telco OperatorsEU Institutions

Regional

Authorities

Mem

ber States

Broadband_Europe as an aggregation point for broadband stakeholders in the

EU

Connecting Communities

Cost Reduction

Connecting Europe Facility

Investment Guide

Actions

StakeholdersEnablers

Topics

EuropeanCommissionDigital Agenda

EuropeanInvestmentBank

WorldBank

EBP

http://ec.europa.eu/digital-agenda/en/high-speed-broadband

Broadband Europe

• Provides information by country on: broadband strategies and policies, state of broadband development, broadband financial instruments, public authorities and bodies responsible for broadband

• Shows broadband development best practices by country,

• Launch of a European award of best broadband rural development project

EU Spectrum Policy Setting

EU Spectrum Policy Setting - Legislative Basis

Interaction with ITU

Broadband mapping initiative

• EC recently introduced item "Broadband Infrastructure Mapping" in the "Rolling Plan for ICT Standardisation 2015" in attention of European Multi-Stakeholder Platform on ICT Standardisation (MSP). http://ec.europa.eu/DocsRoom/documents/8641

• EC launching a new study focused mainly on service mapping which follows a phase 1 mapping study (2013–2014) which surveyed existing mapping initiatives in Europe and recommended a methodology for mapping broadband infrastructure, services, demand and investment

An important momentum….

• Regulatory developments (cost reduction Directive, framework review)

• CEF ready for service• ESIFs almost finalised• New tools (State aid framework simplified, Broadband

Europe & BB investment guide) to inform, share and advise

• DSM among the new Commission's top priorities + €315 billion package in preparation including a strong digital component

Thank you

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