STUDY: Europe half-way to “Digital Heaven”

A study by Point Topic shows Europe is now half-way towards achieving its aim of giving all inhabitants access to superfast broadband by 2020.

The study was produced for DG Connect, the department of the European Commission which is responsible for its “Digital Agenda” strategy.  The purpose of the Digital Agenda is to harness the Internet and other digital technologies to drive sustainable economic growth.  Neelie Kroes, the Commission vice-president responsible, wants to see €7 billion earmarked for EU investments in broadband to help reach Digital Agenda targets, which in turn is meant to draw in private funds of many times that amount.

“This study gives us the best view so far of where action is needed on broadband coverage,” says Neelie Kroes.  “It will help to guide decisions on where EU and private money can be invested to provide the best long-term return for taxpayers and investors such as pension funds.”

The study shows that almost 96 per cent of the homes in Europe can now get basic broadband, meaning services offering at least 144kbps (kilobits per second), if they want to subscribe.  Over 50 per cent can already get superfast broadband (also known as NGA, for Next Generation Access) providing 30 Mbps (Megabits per second) or more.

Basic broadband is fairly widespread now, only three EU countries have less than 90 per cent coverage.  But there are huge variations in superfast availability.  Three EU countries (the Netherlands, Belgium and Malta) have over 98 per cent; three others (Italy, Greece and Cyprus) have under 11 per cent.  All the rest are in the range between 35 per cent and 75 per cent.  There are also big variations within countries.  For example, rural areas across Europe are estimated to have only 12 per cent superfast broadband coverage as a whole.

The study also shows how competing technologies are sharing out the superfast broadband market.  Contrary to a widespread impression FTTP (fibre-to-the-premises) is taking a relatively small share.  “Despite all the publicity, FTTP doesn’t offer the main route to digital heaven, at least not for the time being,” says Tim Johnson, who led the project as Point Topic’s Chief Analyst.  “So far FTTP covers only 12 per cent of homes.  The biggest providers of superfast service are the cable TV networks which can now reach 37 per cent of EU homes with the up-to-date Docsis 3 standard.”

VDSL (Very-fast DSL), the technology for providing superfast speeds over the telephone network, falls between the other two, reaching 21 per cent of EU homes by the end of 2011.  The three technologies together add up to only 50 per cent total superfast coverage because they overlap a lot, competing to serve the richer and more densely populated areas and leaving others underserved.

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