Connectivity Towards a European Gigabit Society

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1 Connectivity Towards a European Gigabit Society Thomas Küpper European Commission Directorate-General for Communication Networks, Content & Technology DG CONNECT Unit Investment in High-Capacity Networks

2 What is the DSM? The Digital Single Market means an area where the free movement of goods, persons, services and capital is ensured and where citizens and businesses can therefore seamlessly access and exercise online activities under conditions of fair competition, irrespective of their nationality or place of residence... and it is not going to happen without high speed networks

3 Digital Single Market is based on three pillars Digital Single Market Better access for consumers and businesses to digital goods and services across Europe Creating the right conditions for digital networks and services to flourish Maximising the growth potential of the Digital Economy

4 Digital Single Market Strategy Deliverables Shaping the right environment for digital networks and services to flourish Pillar 2 DIGITAL ENVIRONMENT Designing rules which match the pace of technology & support infrastructure development. Review the audiovisual media framework Review online platforms, intermediaries Review sharing economy An ambitious overhaul of EU telecoms rules Reinforce trust and security in digital services

5 Connectivity Context Europeans use the internet to What is the situation today? buy products and services of European enterprises use do their banking cloud computing read & watch the news of European SMEs sell online The internet has transformed our society and our economy and made people's lives easier

6 Connectivity Context EU telecoms rules have brought basic broadband to all Europeans at low prices Price for Mbps broadband has dropped by 57% since 2007 At the same time, internet traffic continues to grow at an unprecedented rate exabytes Global mobile internet & internet traffic

7 Connectivity Context Fixed internet connection 4G mobile coverage In 2015, 71%of European households had access to a fast fixed internet connection But this goes down to 28%for households in rural areas In 2015, the EU average of 4G mobile coverage is 86% But this goes down to 36%for households in rural areas This is not enough to address the growing need for speed, quality and reliability of the infrastructure EU action is needed

8 The Public Consultation on Needs for Internet Speed and Quality Beyond 2020 ran until end November 2015 About Current needs Future needs Policy measures to fulfil those needs Will contribute to The design and implementation of our broadband roll-out related tools

9 Public Consultation (Sept.-Dec. 2015) Needs for Internet Speed and Quality Beyond 2020 State of play Around1550 contributions, including 15% by organisations Many position papers Sector specific approach Meetings with representatives of e.g. automotive, video games, R&I, e-commerce, SMEs, etc.

10 Connectivity The Commission's proposal 3 strategic connectivity objectives for 2025 To be supported by 3 main new measures 1. All main socio-economic drivers should haveaccess to extremely high - gigabit connectivity 2. All European households, rural or urban, should have access to connectivity offeringa download speed of at least 100 Mbps 3. Allurban areas and major roads and railwaysshould haveuninterrupted 5G coverageand 5G should be commercially available inat least one major city in each EU Member State by A new Electronic Communications Code to help build future networks 2. WiFi4EU 3. An action plan for 5G

11 Connectivity Electronic Communications Code Electronic Communications Code 1 Modernisation of current telecoms rules to drive investment Increased competition and predictability for investments: Market regulation only where end-user interest requires it and where operators' commercial arrangements don't deliver competitive outcomes Reduced regulationwhere rival operators co-invest in very high-capacity networks & easier for smaller players to be part of investment projects Making investment case more predictable for "first movers" who take the riskto invest in less profitable areas, such as rural areas Stronger consumer protection Easier to switch suppliers when consumers are signed up to bundles Ensure vulnerable groups (like the elderly or disable people) have the right to affordable internet contracts

12 Connectivity Electronic Communications Code Better use of radio-frequencies Long licence durations, coupled with more stringent requirements to use spectrum effectively and efficiently. Coordination of basic parameters such as the timing of assignments to ensure timely release of spectrum to the EU market More converged spectrum policies across the EU A safer online environment for users and fairer rules for all players: Selected rules extended to new online players which offer equivalent services to traditional operators, to ensure security requirements apply. Possibility for users to reach the EU emergency number 112 via in the future online services with no additional costs

13 Connectivity WiFi4EU WiFi4EU 2 Free Wi-Fi for Europeans in public spaces 120 million of EU investment for interested local authorities to offer free Wi-Fi in public spaces How will it work? At least 6000 to 8000 local communities million connections per day The EUto fund the equipment & installation with vouchers; public bodies to pay monthly subscription & maintenance Local communitiesneed to commit to providing very high speed internetvia WIFI4EU, and that they are not competing with a similar, existing private or public Wi-Fi offer

14 Connectivity WiFi4EU Who will benefit? All Europeans WIFI4EU access points will reach both local residents and visitors across the EU Public administrations, hospitals, libraries and other bodies with a public mission They can take advantage of the access points to develop & promote their own digital services, such as e-government, e-health or e-tourism

15 Shared involvement in the project increases the potential for the success story Vouchers Cover infrastructure costs Communities Cover payments to the operator Regulatory framework Removes legal obstacles to deployment and share WiFi access by local communities. Fast deployment Agile audit Real-monitoring 15

16 Action plan for 5G 3 Common roadmap for a coordinated deployment of 5G in 2020 Connectivity 5G Action Plan Common EU calendar for a coordinated 5G commercial launch in 2020 Joint work with Member States and industry stakeholders to: Identify and allocate spectrum bands for 5G Organise pan-european 5G trials as of 2018 Promote common global 5G standards & encourage the adoption of national 5G deployment roadmaps across EU Member States

17 5G Timeline You are here! National 5G Roadmaps Spectrum allocation & assignment 5G Standardisation Cross-border pre-commercial trials Com mmon target 5G Launched in all MSs Venture Capital support to innovative start-up in 5G key use sectors 5G Eve erywhere Best practice + fibre planning to boost "small cell" deployment Continued substantial investments in fibre infrastructure and "small cells"

18 Cost reduction Regulation BB Cost Reduction: objectives Better use of existing infrastructure and more transparency, incl. cross-utility Improved coordination of civil engineering Simplify permit granting process Reduce costs of broadband rollout by 80% and make it easier Buildings ready for access to high-speed internet

19 Structural funds European Regional Development Fund (EFRD) European Agricultural Fund for Rural Development (EAFRD) Funds for TO2 "Enhancing access to, and use and quality of, ICT" 6 blnfor broadband Where is the money? Connecting Europe Facility - Telecoms The Connecting Europe Facility (CEF) supports trans- European networks and infrastructures in the sectors of transport, telecommunications and energy 150 m for broadband EuropeanFundfor Strategic Investments (EFSI) An initiative launched to help overcome the current investment gap in the EU by mobilising private financing for strategic investments??? for broadband Years

20 Financial Instruments Financing Financial instruments and the Structural Funds Traditional grant scheme F.I. and structural funds: CEF credit enhancement 60% Structural funds 30% Structural funds (max. co-funding varies by region category) 20% National co-funding 15% CEF (credit enhancement) 40% National co-funding 35% Senior debt (intermediary and commercial banks)

21 GRANTS FINANCIAL INSTRUMENTS Success factor: Excellence Policy relevance Regional importance Success factor: Profitability Sustanability Revenues optional Repayment not expected Cooperation encourged consortia welcome Revenues mandatory Repayment is a must Cooperation must be formalised (theremust bea legalentity) 21

22 EU Investment Plan: 3 pillars 1. MOBILISING FINANCE FOR INVESTMENT 2. MAKING FINANCE REACH THE REAL ECONOMY Boost investment in strategic projects and access to finance via the European Fund for Strategic Investments (EFSI) within EIB/EIF Cooperation with National Promotional Banks and the EIB European Investment Project Portal European Investment Advisory Hub: technical assistance 3. IMPROVED INVESTMENT ENVIRONMENT Predictability and quality of regulation Removing non-financial, regulatory barriers in key sectors within EU Single Market Structural reforms at national level 22

23 Investment Plan Financing

24 EU Financing EFSI Corporations of all sizes Utilities Eligible partners Public sector entities(non-sovereign) SMEs (below 250 employees) and/or MidCaps (up to 3,000 employees) National Promotional Banks or commercial banks for intermediation Dedicated investment platforms possible

25 Contributions by MS / National Promotional Banks MemberState NPB Contribution announced(up to) Germany KfW 8,000m Spain ICO 1,500m France CDC 8,000m Italy CDP 8,000m Luxembourg SNCI 80m Poland BGK/PIR 8,000m Slovakia SIH/SZRB 400m Bulgaria BDB 100m United Kingdom 8,500m TOTAL 42,580m 25

26 EU Financing EFSI European Investment Advisory Hub (EIAH) Asingleaccesspointtoawiderangeofadvisoryservices. Strengthened advisory support throughout the project cycle: project identification, preparation and implementation incl. the use of financial instruments, advice on structuring and implementing publicprivate partnerships and facilitation of access to finance. A cooperation platform a peer-to-peer exchange and sharing of know-how regarding advisory services. EUR 20 m annual budget in addition to existing TA programs managed by the EIB(Jaspers, fi-compass, Innovfin ) The Hub seeks to improve project quality and be the reference point for project advisory support in Europe.

27 European Investment Project Portal What can the European Investment Project Portal (EIPP) do for you? Registration on the EIPP will boost the visibility of your project Opportunity to find investors from all over the world looking for investment opportunities in Europe Access to a large network of investors, consultants and advisory services that can help you to structure it and finance it Is my project eligible for the European Investment Project Portal? In order to qualify, projects must be: Worth at least EUR 10 million Expected to start within three years of their submission to EIPP Promoted by a public or private legal entity established in an EU Member State Compatible with applicable EU and national laws Publication of a project can be denied on legal, reputational or other grounds.

28 GRANTS European Commission Network of BCOs FINANCIAL INSTRUMENTS COMP AGRI CONNECT REGIO EIB World Bank Support Facility (coordination of BCO network) Member State EU-level T.A. European Investment Advisory Hub (EIAH) Connected Communities Initiatives EAFRD OP-level T.A. ERDF EFSI / CEF Managing authority Implementing body Broadband Competence Office (BCO) Managing authority Implementing body National Promotional Banks (KfW, CDC, CDP, etc.) Commercial Banks Broadband Project Promoters

29 Broadband_Europe as an aggregation point for broadband stakeholders in the EU Connecting Communities Connecting Europe Facility Cost Reduction Topics Actions BE World Bank European Investment Bank Enablers European Commission Digital Agenda Stakeholders Investment Guide

30 An important momentum. Regultorydevelopments(costreductionDirective, framework review) CEF ready for service ESIFs almost finalised New tools(state aidframworksimplified, Broadband Europe & BB investmentguide) to inform, shareand advise DSM amongthe new Commission'stop priorities+ 315 billion package in preparation including a strong digitial component

31 Thank you Please follow us on

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