Friday, 27 April 2018

Europe could be looking at a €150 billion shortfall in fibre funding by 2025

By Chris Kelly, Total Telecom
Tuesday 10 April 18

Industry experts at the Gigabit Access event in Brussels predict that around €500 billion of capital expenditure will be required to complete fibre to the home (FTTH) services by 2025

Industry experts are predicting a potential €150 billion shortfall in investment in the race to roll out universal gigabit connectivity across Europe by 2025. Speaking at the Gigabit Access event in Brussels on Tuesday, Anthony Whelan…

Industry experts are predicting a potential €150 billion shortfall in investment in the race to roll out universal gigabit connectivity across Europe by 2025.

Speaking at the Gigabit Access event in Brussels on Tuesday, Anthony Whelan, director of DG Connect Directorate B at the European commission, said that investment needed to be increased to ensure that rural areas are not left behind.  

"We estimate the sort of investment required, if you follow the normal capex structures of the industry, will be somewhere in the region of 500 billion, and we see an investment cycle that would see us hitting around 335 million investment by 2025. So you are looking at a shortfall in excess of 150 billion and various strategies need to be devised to address that gap.

"We need to ensure that every household should have access to a connection speed of at least 100 Mbps which can be upgraded to a 1 Gbps connection by 2025," he said.   

Studies show that the majority of internet users by 2025 would expect speeds of 1 Gbps as standard. Whelan stated that unless investment levels increase, this expectation will not be met.

"If that is the predicted need by 2025, do we think that the market will deliver this to all users wherever they are located? Probably not."

While Whelan called to attention the need for renewed investment, he also reflected on the achievements made by the industry to date.  

"We do see some encouraging trends. In Europe, since 2011, the coverage of FTTP has jumped from 10% to 27%, now in an infrastructure intense industry that is not a neglible development.

Like most infrastructure trends, it starts to tail off as you hit the most challenging geographies – not just rural areas, but also some less densely populated suburban areas," he concluded.

 

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