| In nations with a clear digital divide, especially urban / | | | | cause. But at the end of the day any entrepreneur |
| rural, should governments intervene with support | | | | will need to assess the risk and reward (you have to |
| mechanisms (funding, tax breaks, direct ownership, | | | | do your due diligence here) before engaging such a |
| PPP's, or anything else) or take a hands-off approach | | | | venture. And of course "his" stakeholders would be |
| and leave it to private enterprise? | | | | keen to know details of their forecasted ROI. In |
| It appears today that the impact of telecom | | | | general when you run some numbers, it's not that |
| infrastructure, especially broadband and mobile | | | | exciting for an entrepreneur to invest alone in such a |
| coverage, on the economy is now widely known | | | | business without seeking incentives or government's |
| (though I still think the definitive study on the topic is | | | | participation in round funding, |
| yet to come). | | | | The digital divide is something that is, or will become, |
| So, even beyond the digital divide issue, local | | | | a big issue for politicians as soon as they wake up to |
| governments are legitimately worried that their | | | | the implications of not having a high speed |
| territory will become less and less attractive if the | | | | infrastructure in their constituency. You can already |
| digital resources aren't there. Inversely, they think | | | | see this in many countries but IMO very few |
| that they can boost their attractivity (and therefore | | | | politicians really understand the implications. Figures |
| their economy) with telecom infrastructure. | | | | from studies suggest ICT can have a positive impact |
| Seen in this context, it makes sense that local | | | | of between 2-4% GDP at a national and regional level |
| governments would want to invest in such | | | | across OECD countries, very important where votes |
| infrastructure, and in the FTTH area we are seeing | | | | are involved. |
| more and more examples of this approach in Europe | | | | The issue then surrounds how much government |
| (Pau, Stockholm, Amsterdam, Cologne, Hauts de | | | | should get involved vs leaving up to the private |
| Seine) and in the US (Lafayette, Chatanooga, Palo | | | | sector. |
| Alto). | | | | From reading various press articles most government |
| The issue is really broader than that. Private ventures | | | | interventions become huge unwieldy burdens that |
| should be favoured whenever possible.....but the | | | | deliver little in the way of progress but consume |
| stakes are high. Again, in the case of FTTH, the | | | | much in the way of time, meetings and reports..... oh |
| attractivity that could result from a wide availability | | | | & take 5 times as long as anyone expected to |
| of very high bandwidth services at a national level | | | | reach any consensus. |
| could potentially impact economies at the state or | | | | However if left purely to the private sector you run |
| country level. In Italy and Germany, the incumbents | | | | the risk on nothing being done due to the fairly short |
| have already stated that they would not deploy | | | | sited metrics used by many service providers who |
| FTTH because it's too expensive for them. Supposing | | | | expect ROI of 3-5 years or less. |
| a government saw this as short sighted, should they | | | | As in many things in life no one size fits all but some |
| intervene ? | | | | things can be done. |
| To be honest, I'm on the fence on this issue. Perhaps | | | | Over the last 12 to 24 months there have been |
| direct government intervention when service is | | | | significant market developments in the provision of |
| available or likely to be available within a reasonable | | | | next generation broadband globally; for example, |
| time frame should be discouraged. However, defining | | | | Germany is giving DT a regulatory 'holiday' to allow a |
| "service" is tricky. | | | | EUR3billion investment in a Fibre to the Home, in |
| Aat the very least governments could legislate to | | | | France both FT and competitors are now investing in |
| encourage private investment and lower the costs. | | | | fibre to apartment buildings and in Sweden such fibre |
| Infrastructure deployment is costly afterall. And a | | | | solutions are becoming increasingly prevalent for |
| good portion of that cost comes from the often | | | | businesses and residential customers alike. |
| nightmarish administrative aspects that slow down | | | | Anyone looking to build a network will need to |
| deployments (hence impairing revenues) and thus | | | | understand their economic, spatial and service drivers |
| cost a lot of money in administrative handling. | | | | as applicable to the region. |
| Unfortunately, it appears that countries who take a | | | | So, the answer is ...... it depends. Government needs |
| completely hands off approach will pay the price in | | | | to see the importance and find ways of partnering |
| time. They will inevitably fall behind as is currently | | | | with the private sector to ensure they can look |
| seen in the US regarding broadband. | | | | beyond the 3-5 yrs time frame. Or find some way of |
| Fighting against the Digital Divide is an honorable | | | | helping the private sector to ease the pain. |