Broadband policy from the back mirror: What can we learn from European experience?

The historical path of broadband development is interesting to analyze in order to assess how the previous policies were interrelated, whether they were consistent, and whether an integrated framework can be formulated. This is of special interest to understand today, as the ICT policy agenda is being discussed around the world, for example the US, Japan, Sweden etc., in order to formulate future strategies. A case in point is the European Commission (EU) which has started a process to formulate a new set of ICT policy goals for 2015, replacing the previous i-2010 policy agenda. In the EU, the European Commission has considered wide broadband coverage in Europe as crucial for fostering growth and jobs in Europe. Since the 1980s, telecommunications networks and services in the European Community have been reformed by a number of factors. As the first major initiative in telecommunications made by the European Commission, the 1987 Green Paper on the development of the common market for telecommunications services and equipment was issued. In the context of this paper, it is interesting to note that a broadband vision was stated even in the 1987 Green Paper, before broadband started to be adopted. Although the primary objective of the Green Paper was not to discuss broadband development policy, it was accepted at that time on the EU level that broadband infrastructure was essential for future economic and social development. Nowadays, 20 years later, many policies relating to broadband development have been initiated and discussed in the EU. Those policies and initiatives can be categorized into three major approaches. The first approach is a broad policy framework which set the scene and recognized that broadband is strategically important to EU development. Within the first approach, e-Europe 2005 and i2010 are the major policies. The eEurope 2005 policy was started in the year 2002 and aimed at the development and use of advanced services running on a secure broadband infrastructure. It set widespread availability and use of broadband as one main objective to be attained by the end of 2005. To reach that objective, the European Commission formulated policies to encourage investment in broadband infrastructure, applications and services. Later, a strategic framework, i2010 – A European Initiative for Growth, has been implemented since 2005 to build towards an integrated approach to information society and audiovisual media policies in the EU. An important development of this framework was the emphasis on broadband as a driver of inclusion and quality of life. Thereby the new policy built towards the three priorities for Europe’s information society, which were the completion of a Single European Information Space, strengthening innovation and investment in ICT research, and achieving an inclusive European information society. The second approach is that of telecommunications regulatory policies. Within this approach, several telecommunications regulatory frameworks have been issued or proposed with an aim to encourage broadband competition in the market − such as local loop unbundling, open access regulation, bit-stream access and functional separation. Recently, the draft recommendation for the regulation of next-generation access networks (NGA) has been proposed to promote broadband and to improve consistency of regulatory frameworks throughout the EU. The third approach concerns non-regulatory government policies. It does not involve broad policy as the first approach does; rather it deals with encouraging broadband infrastructure development through different incentives from government such as state-aid rules. It is interesting to note that this approach of state-aid rules can be considered as a step back to an old-style policy of telecommunications whereby government ownership has been the main vehicle to pursue infrastructure goals. When broadband has been targeted, the policy seems to step back to a preliberalization mode, despite the fact that the telecommunications market has been propelled by competition for a number of years. The crucial points are that each approach is based on different objectives and strategies but all of the approaches consider broadband as a major tool to achieve their respective agendas. Nonetheless, the interrelationship among those approaches has not been investigated and the empirical evidence with regard to the interaction of other forms of public policy and regulation is relatively limited. Against this background, the proposed paper will be structured as follows. First, it will present a brief market overview of broadband penetration from several data sources. Next, a historical overview of broadband policies and initiatives of the three approaches in the European Union will be given, with particular attention to early initiatives. The paper will also analyze the prospect of broadband in various approaches in an integrated structure. Moreover, the paper will discuss whether or not the three different approaches were consistent in terms of encouraging broadband deployment, and whether or not the three policy approaches can achieve high broadband development in the EU. In addition, the paper will address whether or not future broadband policy should be formulated in a more holistic fashion