5 Comments

Summary:

France plans to spend up to $27 billion on fiber connectivity. Yet, the plan so far doesn’t detail how operators will fund deployment in rural areas, a sticking point that torpedoed a previous attempt.

French flag
photo: Flickr / fdecomite

France has unveiled a financing plan that would result in the government and private companies spending €20 billion ($27 billion) over the next 10 years bringing high speed broadband and fiber connectivity to the country. The news comes after the EU’s budget cut almost all of the $7 billion it planned to spend bringing broadband in Europe.

Yet Europe still hopes to have 50 percent of the population at 100 Mbps speeds by 2020 with the rest of the population at 30 Mbps.

France’s president Francois Hollande outline the plan in a speech earlier this week, according to a Reuters story. From the story:

Three tranches of more than 6 billion euros each will fund the planned network rollout, Hollande said. One will come from network operators, one from a mix of operators and local government and the last from state and local-government money.

The goal is for 50 percent of the country to have faster broadband — although those speeds weren’t specified — by 2017. France attempted this before, but it failed because operators didn’t want to invest in rural areas where the costs of deployments are higher. Under the new plan, operators will be able to pool their capital to fund those areas, which may or may not actually inspire them to invest. The details aren’t clear, but if operators could share rural networks and all provide service on them, it might be a model worth watching for future rural deployments.

You’re subscribed! If you like, you can update your settings

  1. Stacy,

    As always with these announcements, it’s hard to understand what’s already in place, what’s new, etc.

    Basically, a third of that $27bn is not “new money”, it’s money that private players (mostly Orange) have already commited to spending over the next ten years.

    Of the remaining 2/3, there’s already a fund of about $1.2bn to be allocated for projects. How the national government will finance that fund gowing forward to get to the $9bn they are commiting to is a questionmark at this stage; it could be some tax mechanism on the industry, it could be some spectrum subsidies, it could… also never happen (which was what the previous government chose to do in the end…)

    The local government’s $9bn is the haziest one. Again some of that ù9bn are already commited in projects, maybe $1/2bn or a little more. Where is the rest coming from ? Probably from building less roundabouts and stadiums.

  2. David H. Deans Friday, February 22, 2013

    “High-speed broadband will strengthen the competitiveness of our companies and the quality of our public services,” said President Francois Hollande.

    It’s wise to think beyond the current economic challenges within the region. The realities of the Global Networked Economy means that the leaders who choose to apply strategic foresight today will be better prepared for the upside opportunities once the European economy recovers.

    Every predictable economic cycle tends to conclude with the apparent benefactors being confident they’re ready for the eventual market acceleration — while the laggards are wondering how they totally missed the opportunity for economic advancement, yet again.

  3. The best way to make money of this plan is to bet it doesn’t happen.

  4. The best way to make money off this plan is to bet it doesn’t happen.

  5. Nice general idea, but the financing is too unclear. The method of building the network is unclear. Are local cities, towns, and villages to build fiber optic networks within their boundaries, and then wait on the national government or private companies to lay the long fiber connections connecting the network to the internet?

Comments have been disabled for this post