Broadband Universal Service in Europe: Review of Policy Consultations 2005-2010

Abstract

Recognition of the growing importance of broadband to the public presents challenges for policy-makers in introducing efficient strategies, not only to serve the increasing demand for broadband among people in society but also to increase their economic contribution both in the short run and in the long run. Different measures and strategies have been implemented in many countries and regions in order to encourage broadband deployment. Among them, the inclusion of broadband in the scope of universal service has been discussed.

In the European Union, the discussion on broadening the scope of the Universal Service Directive (USD) to include broadband has been raised since the first periodical review in 2005. At that time, the European Commission concluded that only a small, although rapidly growing, minority of European consumers currently make use of broadband services.

Therefore, the conditions for including broadband services within the scope of universal service as set out in the USD were not fulfilled. Later, the European Commission launched the second periodical review of universal service in 2008 with the preliminary conclusion that broadband has not yet reached the majority of people, implying that the conditions of the USD for expanding the scope of universal service were not yet fulfilled. However, the public consultation on broadening the scope of the USD to include broadband has been opened since March 2010 and was last on May 7, 2010. In the meantime, the public workshop organized in the context of the public consultation on universal service principles in e-communications was held on March 30, 2010. The workshop provided wide-ranging views on the topic, including an assessment of the cost of broadband availability and also the rapid change of broadband penetration rate throughout Europe.

Against this background, this paper provides an analytical survey of the current state and trends of universal service with focus on broadband access in the European Union. First it presents an overview of broadband deployment and regulation in Europe. Then, it analyzes the USD reviews by taking into account the previous and the recent review, in particular by comparing the discourse evolution of the public submissions from stakeholders in the two consultations. A framework to evaluate broadband universal service will be provided. In conclusion, the paper will identify selected issues regarding broadband universal service in Europe, especially the pros and cons of broadband universal service.

Keywords: universal service obligation, broadband, legislations, public consultations

JEL Classification: O00