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European Commission

Neelie Kroes

Vice-President of the European Commission responsible for the Digital Agenda

Connecting Europe: Fast Broadband for All

Broadband World Forum/Amsterdam,

16 October 2012

I want to talk to you today about broadband.

But first: I want to tell you another story, about another kind of technology.

When I was young, I remember when my parents got their first telephone. We were more or less the first on our street.

It was amazing. Partly it was the exciting novelty of having a new gadget. But that wore off.

What didn't wear off was the amazing new things we could suddenly do with this new device.

Suddenly, we could get in touch with people around the world, friends and family, new contacts for the family business. Easily, instantly, inter-actively. We were suddenly part of a wider community, we could reach out to the whole world.

Today, a phone is nothing remarkable. In Europe, pretty much every European household, 98%, has one. Particularly mobiles. And one in three of us has a phone that can access the internet. Those phones open up so many essential opportunities, so many new connections, that few of us could imagine living without them.

That's how technology goes from being a desirable novelty; to completely commonplace; to something so essential it's almost a human right.

From being a futuristic fantasy, to the backbone of our economy.

That's how new technologies can transform our world.

And the next of those technologies is broadband internet.

We're at a crossroads for broadband. Where we end up depends on some tough political and investment decisions. Take the right turn, and we will see the benefits for many decades to come. Take the wrong one, and future generations will curse our missed opportunity.

The last few years we have seen Europe slipping behind in productivity growth.

We need to catch up. But how?

Well, in recent years, much of that productivity growth has come from the ICT sector and investments. Around half. And no wonder: ICT is the most powerful, productive investment there is.

Particularly investing in broadband. The wider social and economic benefits are huge. It means more growth, more jobs and a more competitive economy.

The new ideas we've had recently, from social networks to video-streaming to crowd-sourced knowledge, they're amazing. 10 or 20 years ago they were unheard of: now they're part of the everyday furniture. And all enabled by the internet.

It's easy to take that internet for granted. Just as we take drinking water or electricity for granted.

And it's easy to think that innovation will carry on growing exponentially, automatically, indefinitely.

Will it? Well, I hope so.

But it needs political attention, and investment. In networks, in frameworks, and in services.

Because you may think the internet we have today is pretty cool. And it is! But it's just the start.

Because there's a whole set of new services just starting to come on stage. They could change our world all over again. But they need broadband.

Cloud computing is a whole new model for providing IT. With software or storage held remotely – and accessed over the network. Imagine – all your favourite services, music and movies stored in a cloud locker, and you can access them from wherever. And companies, across most of the economy, getting fast, cheap, flexible IT services too.

It's a huge opportunity: in 2020, worth maybe 250 billion euros to the EU economy. But it needs fast broadband.

Or take eGovernment. Online services so your government can serve you better. And save your tax money too: just using eProcurement could help save 100 billion euros a year. But it needs broadband for everyone.

Or take new tele-health services. Letting people be cared for in the comfort of their own homes. Just think what a difference it could make to people's lives, in a future Europe where one in three adults is over 65, and wants to grow old with dignity and independence. But it needs broadband.

And there's more. Connected vehicles. Smart cities. Smart energy girds. Virtual universities. The Internet of Things. And these are just the innovations we know about.

In short, we are far from hitting the limit of the internet's innovation potential. Let's not have it tied down by slow connections.

Because all this growth is having an impact on our networks. How much?

For a start there's wireless broadband. It's growing incredibly fast, thanks to all those smartphones and tablets. It's doubling every year.

To meet that demand, Europe needs a massive “data plan”: one providing 3 trillion Megabytes a month by 2016.

How do we get that? Not at your local mobile phone shop!

We need to provide enough radio spectrum.

We need to find frequencies, refarm them for wireless broadband, and put them into use.

Already today, too few Europeans can enjoy the highest 4G speeds on the latest gadgets. National governments need to change this as a matter of urgency. Otherwise they're letting their citizens down; and letting their economy down.

And we need to work together as Europe: otherwise the big, global manufacturers, when designing their latest device, will just ignore our continent's needs.

That's wireless. But here's the bigger thing: fixed broadband. It isn't growing quite so fast. But its use is still rising exponentially, doubling every 2 to 3 years. That will only increase as new services take off.

With that kind of growth, the pipes will get full very quickly. Today, fortunately, networks rarely go down. But when they do, it's devastating.

Amid exponential demand, we can't condemn our people to a Europe of old, congested, unreliable networks. To a world of blackouts and blackspots. To giving up their smart phones and going back to dumb ones.

This needs serious attention: and if politicians don't provide, our people won't be too patient.

On top of networks, here's another way to better serve citizens; and save money. With top-quality digital public services. Because at a time of austerity, we need more than ever to do more with less; you can't do that using 20th century methods. We must modernise our public services, with tools for the 21st century. Put public services online; and make them accessible across borders, within our digital single market.

How do we get those networks and services?

First, we need the right legal framework for private investors. With the environment that promotes long-term investment. I set out my proposals for how we can do this back in July; and it's changed the game.

But private sector funding alone won't be enough. The business case is still too risky for too many; confidence still too weak. Too many regions would still be cut off in the dark ages.

That's why we've proposed the digital Connecting Europe Facility. To fix both of these problems. To stimulate the investment that could connect one in five of households to fast broadband. And ensure digital public services that are high-quality, and serve across borders.

It's not just that this support for broadband would be loans, paid back with interest.

It's not just that this will stimulate significant private leverage, making every cent work seven times harder — something you can only do at this scale at EU level, by the way.

It's that these are essential to our economic future. The backbone on which we will build tomorrow's economy. And a great way for governments to deliver better services more efficiently.

Governments need, urgently need, to have the courage to invest.

Many places are getting that fast access. But there'd still be too many struggling by without. We would create a new, troubling digital divide; whole regions shut off from online opportunity. The Connecting Europe Facility would make a significant difference to so many. With 45 million more households connected.

We must fix this. It's essential to our future. I'm convinced; I know many of you are too.

But now we need to convince decision-makers too, particularly those in national governments who can unlock this investment.

That public support is in our citizens' interests. It's in our economic interest. And it's in those governments' interests, too - given the great savings they could benefit from.

We have some decisions coming up. We'd better get it right, for the sake of our competitive future.

Other places in the world have already taken those decisions. They are pressing ahead with high-speed internet, pouring massive investments into networks.

This year alone, China is installing 35 million fibre connections; Japan already has over 20 million. In the US, high speed networks now pass more than 80% of homes; a figure that quadrupled in three years.

Those countries will see the benefits. Benefits for their citizens, able to explore and innovate in a new world.

They'll see benefits for their ICT ecosystem. Because network equipment makers, electronics companies, content and service providers will all have the infrastructure they need to flourish.

And they'll see benefits for the entire economy. Because ICT isn't just used by the ICT sector. Every sector of the economy is going digital. Every one relies in some way on digital technology and fast connections. Whether it's transportation, or tourism, or television.

In 2020, when an international business looks at where to put itself, it's going to look for the digital societies with ultrafast broadband.

Here in Europe, just one million homes have very fast symmetric connections: less than one half of one percent.

I don't want us to languish in that slow lane, overtaken by international partners. I want Europe to get Usain Bolt Internet.

Because we can't stay competitive, we can't become a world leader, struggling by on ancient networks. We need fast broadband for all: it's time decision makers woke up to that.

Thank you.


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