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Finland Legislates Universal Broadband

Finland’s national broadband strategy (NBS) was set up in 2004 by the Ministry of Transport and Communications with the practical goal of increasing the number of broadband connections. The strategy, part guided by the EU’s i2010 ‘Broadband for all by 2010’ plan which focuses on rolling out broadband through a range of measures while promoting competition in and between networks, included an implementation program of 50 separate measures. Broadband access in sparsely populated and rural areas was to be supported by structural funds from the EU and central government.

Largely due to efforts by municipalities and regional councils, by early 2005 regional broadband availability stood at about 96%, and so the government revised the strategy’s objectives to focus on the speed of connection, the creation of content and the development of wireless broadband. The strategy envisaged that all subscribers would be able to access at least 1Mb/s by 2010, with the most common service offering being at least 8Mb/s.

The government has now stepped up a gear, becoming the first in Europe, nay the world, to legislate for broadband to be a universal service. This anticipates similar moves in other countries: Austria’s coalition government has set a target for access to broadband at a minimum speed of 25Mb/s for the entire population before 2013, partly through legislation which promotes wholesale access and co-operative ventures among operators to reduce deployment costs. The UK’s much debated Digital Britain report (June 2009) proposed 22 recommendations to provide all households with a broadband service of at least 2Mb/s by 2012. Mobile broadband would service the estimated 15% of homes in rural areas which are not expected to receive 2Mb/s via viable fixed-line solutions. Yet universal broadband here relies on the mobile network operators reaching a deal over re-apportioning the use of 900MHz wireless spectrum that was granted to the two original networks—Vodafone and O2—in the 1980s. This needs to be sorted out before the government can sell off the 800MHz spectrum that it will get back when analogue TV signals are switched off in 2012, and which has been tied to the much-delayed auction of 2.6GHz spectrum. These difficulties mean that universal broadband in the UK by 2012 looks very unlikely.

Finland’s Communications Markets Act, amended in July 2009, required telcos subject to a USO to provide broadband as a universal service at a reasonable price by December 2010. The new legislation has brought this obligation forward to July 2010 (while also increasing the minimum data rate from 50Kb/s). By December 2009 the regulator planned to allocate a telco in each geographical area as subject to the USO.

The speed increase to 1Mb/s means that the service must also be implemented with upgraded wireless solutions across rural areas of the country. Fortunately, for wireless broadband services Finland has traditionally been ahead of the game. Gaps in the fixed-line network have been filled by Digita’s @450 mobile network, which makes use of the frequency band released by the discontinued NMT 450 network. As early as 2007 TeliaSonera launched 1Mb/s wireless broadband services over Digita’s network, principally to meet the needs of people living in sparsely populated areas.

In addition, Finland’s MNOs have all invested in HSPA technology which currently covers most of the country: TeliaSonera’s entire 3G network had been upgraded to HSPA by late 2007, by June 2009 all base stations in DNA’s network could support HSPA+ (providing up to 21Mb/s download), while since July 2009 Elisa has rolled out HSPA+ in the 900MHz band, which will be compatible with offering LTE services in the future.

So not only is Finland’s broadband USO practical and achievable, it also forms only an initial stage in the government’s Broadband Action Plan, which aims to deliver 100Mb/s fibre-based broadband for all citizens by 2015. This is also envisaged to be a legal right, and so anticipates LTE being readily available in the mobile sector to deliver complementary services to rural areas.

The 100Mb/s target may be ambitious, but since mid-2008 telcos, utilities and housing associations have ramped up their fibre network investments, extending fibre beyond the major cities and their suburbs to incorporate other communities as well. In smaller population centres fixed broadband is still predominantly provided via the copper network, though the inherent limitations of copper are also rapidly being addressed: in September 2009 TeliaSonera, with equipment provided by Alcatel-Lucent, deployed the country’s first 100Mb/s hybrid FttB/VDSL2-based network.

Looking further ahead, the regulator will draw up a new action plan in 2012 to prepare for the post-2015 market situation. One can only hope that by then other countries are not still debating a universal 2Mb/s service.

By Paul Budde, Managing Director of Paul Budde Communication

Paul is also a contributor of the Paul Budde Communication blog located here.

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