The 2030 Digital Decade Targets to guide Europe’s digital transformation have been a key milestone of this European Commission. Within this plan, the objective to reach gigabit connectivity for all is fundamental to enable the digital transformation of Europe and the acceleration of new technologies such as AI and cloud computing.
The demands of a digitally connected future require leaders and innovators to act decisively to deliver sustainable, secure and resilient networks. With this in mind, in this blog I share our insights and recommendations for effective European connectivity policies.
The European Commission has brought forward various initiatives to address Europe’s connectivity investment gap. A substantial portion of the European Union (EU) Resilience and Recovery Facility (RRF) has been allocated to improving connectivity, in addition to more 5G spectrum auctions, public-private partnerships around rural areas, and a new connectivity toolbox in the Gigabit Infrastructure Act (GIA). However, investment in network deployment continues to stagnate in many European regions that are yet to be covered by gigabit connectivity.
Considering the first half of 2023 and the years ahead, Cisco is observing a deep transformation in how connectivity is delivered and consumed. It is an immersive future that must be intrinsically sustainable and secure.
The journey towards Europe’s Digital Decade
The “State of the Digital Decade” report planned for adoption in June 2023 will take stock of the EU’s progress towards 2030 digital targets, identify gaps and issue recommended actions to address them. With the publication of the report looming and European Member States establishing their strategies to reach the connectivity targets of the Digital Compass, a new reality is unravelling for the EU legislative telecoms landscape.
In 2018, the review of the European Electronic Communications Code (below, the Code), set the course towards the large-scale deployment of high-speed networks. Since then, the EU connectivity panorama has changed significantly. However, many objectives of the Code have not yet been achieved and the EU must accelerate progress to become a Gigabit Society by 2025.
The Commission has presented a series of tools to accelerate the development of connectivity networks – from state aid rules for broadband networks to the Gigabit Infrastructure Act proposal. Europe is now aiming at a faster and cheaper rollout of gigabit networks in the EU. And with its recent public consultation on the future of mobile networks, the Commission wants to capture all technological developments to better understand the current market before devising potential remedies to market failures.
The future of mobile networks – why WiFi matters
A digitally connected Gigabit world cannot be achieved without a strong contribution from 5G and Wi-Fi, alongside fibre. This is recognised in the final political text adopted for the 2030 Digital Decade Targets.
Wi-Fi is an affordable technology, easy to deploy within homes, and provides low latency and very high throughput. According to the 2022 Digital Economy and Society Index (DESI), Internet access at home continues to be provided mainly via fixed technologies (98%), while over 90% of European data usage takes place indoors. Wi-Fi ensures that billions of connected devices make the most of broadband service: 92% of European broadband traffic is relayed via Wi-Fi once it enters a building.
Mobile devices also rely heavily on Wi-Fi. More than 80% of mobile device traffic originates or terminates indoors on Wi-Fi. As a result, Wi-Fi traffic has doubled every 3 years, and the existing 2.4 GHz and 5 GHz Wi-Fi bands are quickly becoming congested, putting at risk Europe’s technological leadership and the ability of European citizens to take advantage of their high-speed fibre connections.
The road to ITU WRC23: A critical milestone for tomorrow’s connectivity
At the next World Radiocommunication Conference (WRC23) in Dubai (20 November- 15 December 2023), international regulators will set the wireless spectrum policy for the next four years. The WRC represents a unique window of opportunity to make the best use of spectrum bands. Spectrum availability, award procedures (incl. costs) and the types of conditions attached to licences all fundamentally impact network investment incentives and expenses.
In May of this year, the European Commission adopted its proposal for a common negotiating position which aims to ensure that EU citizens and businesses have smooth access to services such as 5G without cross-border interference. The new rules will underpin Europe’s green and digital transition by preparing the legal ground for a large-scale rollout of VHCN.
While making available sufficient spectrum for both 5G and Wi-Fi is critical to the success of the Digital Decade Targets, Cisco recommends allocating the upper part of the 6Ghz band at WRC23 for unlicensed spectrum. This will relieve the capacity of Wi-Fi bands and improve users’ experience.
Cisco’s recommendations to meet Europe’s connectivity ambitions
Cisco’s technologies are the backbone of the internet. Our unique know-how as an architect of the internet, coupled with our approach to innovation and network sustainability gives us unrivalled visibility and expertise on the future of networks.
With this in mind, we strongly urge policymakers to consider the following policy recommendations:
- Consider a more flexible regulatory framework
The Commission should consider reducing red tape to align with the spirit of the Gigabit Infrastructure Act. It should support service providers to tap into existing public funding, as well as tax credits, in line with sustainability objectives. To create a true telecoms single market, the Commission could revise the EECC to tackle divergences of national approaches, especially on the application of definition of electronic communications
- Address market failures and provide more incentives to fill the investment gap
New digital infrastructure should primarily be paid for through the private sector, incentivised by the right regulatory framework, including facilitating network sharing. That said, it should be recognised that the EU will not achieve full coverage of high-speed, high capacity and reliable networks without some level of public funding as it is unlikely that there will be a strong case for private investment in rural or other white areas.
- Implement a harmonised, forward looking EU radio spectrum policy programme
Since policy has significant impact on market structures and competition, the EU should accommodate new spectrum requirements for users’ needs, IoT and digitisation of the verticals without discriminating between business models. Fibre rollout should be more incentivised as a means to handle density of use and to provide backhaul for increased traffic. The EU should also make sufficient licensed and unlicensed harmonised spectrum available in a timely manner.
We are on the edge of generational digital change. Cisco is a strong believer that policies and innovation should be purpose-driven. From businesses to governments, it’s everyone’s responsibility to make broadband infrastructure affordable, sustainable, and secure in the long term.