France Pledges £17Bn For Superfast Broadband

French President Francois Hollande has stuck to his socialist philosophy of hefty public investment projects to counter austerity, promising to spend billions of euros on a nationwide superfast broadband network that will connect half the country in five years, and the whole population in ten years’ time.

Hollande pledged on Wednesday to spend over the next ten years a staggering é20 billion (£17.3 billion) of both ‘public and private funds’, to try and kickstart the construction and deployment of a nationwide superfast broadband network across France.

French Investment

The French Digital Ambition (Ambition Numerique) plan comes amid tough times for the French economy. Hollande has previously stated his belief in spending heavily on national investment projects as a way to counter the tide of austerity, and the stagnating French economy.

Currently, France’s superfast broadband deployments have largely been limited to major cities and towns, with telcos such as France Telecom and Vivendi reluctant to spend the money to fibre up the French countryside.

“The very high speed enhances the competitiveness and attractiveness of the region,” said the President, in a speech given at Clermont-Ferrand in Aubergne, reported by our sister publication ITespresso. “I made the decision to release 20 billion in next 10 years for access to high speed. ‘

The brooadband boost will increase the competitiveness of French companies and the quality of public services, he said. It would preserve and develop employment, he added.

France will divvy up the £17bn broadband investment in three tranches, of more than 6 billion euros (£5.2bn) each.

One third will be funded by private operators in densely populated areas, one third will be funded by operators and communities in moderately densely populated areas, while one third will be funded by state and local government – but especially the state – in the remaining [rural]areas.”

According to Hollande, one of the tranches of funding will come from the network operators themselves, another tranche will come from a mix of operators and local government, while the last tranche of funding will come from the French state and local-government.

It is reported that the local government contribution will be funded “using tax-free, regulated deposits gathered by state bank Caisse des Depots.”

Hollande’s ten year plan will see 50 percent of the country covered with superfast broadband by 2017, the end of his first term in office. It should be noted that Hollande’s predecessor Nicolas Sarkozy, had also announced a similar nationwide plan that was worth 4.5 billion euros (£3.9bn) whilst he was in office, but the plan never got off the ground due to operator reluctance.

Funding Questions

According to Reuters, the new plan offers a different route by allowing operators to share rollout costs in less profitable areas (i.e. rural and semi rural locations). It is not clear at this stage how much of France’s fibre deployment plans will be FTTC or FTTP (fibre to the cabinet or premises), and if there are plans to incorporate a wireless option for the hard to reach areas.

It is also not clear at this stage how any of the funds from local government and the French state will be allocated between the commercial network operators.

The French state is known to still retain a 13.5 percent stake in France Telecom for example, which could raise the possibility of investigations if others complain about state-aid funding.

National Importance

Yet the size of the French broadband investment demonstrates the growing recognition by national governments of the importance of superfast growth for their countries future growth prospects.

Last month the chairman of the Federal Communications Commission (FCC) in America, called for at least one gigabit-speed broadband community in all 50 US states by 2015.

And in December last year, Deutsche Telekom announced a mammoth investment programme for superfast broadband, when it revealed it would invest almost 30 billion euros (£24bn) over the next three years for a combined fixed-line and wireless (i.e. LTE) network.

In the UK, investment in superfast broadband is much more modest, and more reliant on the commercial sector.

BT is spending £2.5 billion to cover two-thirds of UK premises by the end of 2015 in superfast broadband. Meanwhile the government’s £530 million Broadband Delivery UK (BDUK) scheme will assist in bringing fibre to the remaining third of the UK, but this will be dependent on funding partnerships with local councils (i.e. local taxpayers).

It does look likely then that the UK may have a better broadband landscape than France over the next decade, thanks to the fact that the geographic reach of broadband in this country (98 to 99 percent) is much wider than in France.

But then again, very little of the British countryside can actually be officially classified (using EU definitions) as truly rural. So France with its larger land mass and more remote locations, proves to be a tougher, and more expensive challenge for a superfast broadband deployment.

Read this story on ITespress.fr!

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