Europe promises €10bn superfast broadband support

Commission wants to help private firms lower the risk of broadband upgrades

The European Commission (EC) is proposing to invest nearly €10bn (£6.36bn) in boosting the deployment of high-speed broadband and other electronic services in the region.

The Commission wants to establish a €7bn fund to provide grants for rural broadband projects, with a further €2.1bn set aside for infrastructure projects that support electronic identity, health care records and e-procurement.

“Here in Europe we face several problems in deploying broadband, with insufficient investment, problems in accessing capital, and a weak business case for rollout in less populated areas,” said Neelie Kroes, vice president for the EC’s digital agenda initiative. “This is potentially a serious barrier to growth.”

The EC estimates that the “right broadband development” could boost Europe’s finances by €1tn over the next decade, creating millions of jobs.

Kroes said the European grants should lower the risk for private companies involved in deploying broadband infrastructure. But the funding will not just go to incumbent telcos, she insisted.

“We would competitively engage new players — such as non-telecoms utility companies, or construction firms,” she added.

Under the EC Digital Agenda, the EC has committed to ensuring that the entire population has access to broadband with speeds of at least 30Mbps by 2020, with at least half having access to services of 100Mbps.

The European targets look less ambitious than the plans laid out by the British government. It has earmarked £530m to ensure 90 per cent of the UK population has access to superfast broadband by 2015.

Currently, the UK’s telecom regulator Ofcom classifies broadband speeds of 24Mps as “superfast’ – a threshold some way below the EC’s target figures.

In September 2011, UK culture secretary Jeremy Hunt warned that the UK was in danger of missing its broadband targets.

The EC’s spending plans must now be approved by members of the European Parliament and the EC Council of Ministers.