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Publication date
Rural areas
This benefit ratio is, however, significantly lower in rural areas when compared to urban, primarily because the costs are higher in rural areas than in urban areas while the benefits per user are comparable.
Given the likelihood that commercially acceptable returns on investment in broadband networks in these areas will not be forthcoming for at least 10 years, the private sector is unlikely to be persuaded of the commercial merits of rolling out terrestrial broadband networks into these areas, despite the fact that these areas hold the key to bridging the Digital Divide in Europe. As a result it is expected that between 13 and 20 million people across Europe will remain unserved.
Satcom solutions
The potential role of satcom in bridging the Digital Divide across Europe may be key if the objective of offering near 100% connectivity across all the EU is to be achieved. It is estimated that satcom may prove to be the optimal method (in terms of financing and speed of rollout) to meet the demand from many of the 4.7 to 7 million unserved homes across Europe, especially those in the most challenging locations. Only 1 million of these otherwise unserved homes could be carried by existing satellite systems, even including the expected incremental growth of those systems over the next ten years; larger numbers of users would require the introduction of new, more cost-efficient satellite systems.
Public support
The preliminary results of this Cost Benefit Analysis highlight that there remains a sizeable demand for broadband within Europe that is unlikely to be met by market forces in the medium term, mostly in rural areas.
The major challenge for Europe is to roll out broadband as quickly as the other competitive world economies. Although market forces can mostly be relied upon to achieve this in urban areas, Europe faces particular challenges in sustaining the economic viability of its rural areas. It is therefore likely that satcom will have an important role to play in the mix of technologies that will be a part in bridging the Digital Divide in rural or less privileged areas of Europe.
07 Dec 2004
To underpin the policy decisions, ESA assessed a Cost Benefit Analysis of satcom and alternative technologies which, had concluded that widespread adoption of broadband in Europe would have significant economic benefits.
Rural areas
This benefit ratio is, however, significantly lower in rural areas when compared to urban, primarily because the costs are higher in rural areas than in urban areas while the benefits per user are comparable.
The analysis also looked at ‘un-met demand’ which was defined as the number of enterprises and consumers in areas not currently covered by terrestrial broadband networks who would take up broadband services if they were made available at the prices prevailing in areas where those services are available. Findings showed that the majority of ‘un-met demand’ for broadband in Europe is forecast to be in the rural regions. |
Given the likelihood that commercially acceptable returns on investment in broadband networks in these areas will not be forthcoming for at least 10 years, the private sector is unlikely to be persuaded of the commercial merits of rolling out terrestrial broadband networks into these areas, despite the fact that these areas hold the key to bridging the Digital Divide in Europe. As a result it is expected that between 13 and 20 million people across Europe will remain unserved.
Satcom solutions
The potential role of satcom in bridging the Digital Divide across Europe may be key if the objective of offering near 100% connectivity across all the EU is to be achieved. It is estimated that satcom may prove to be the optimal method (in terms of financing and speed of rollout) to meet the demand from many of the 4.7 to 7 million unserved homes across Europe, especially those in the most challenging locations. Only 1 million of these otherwise unserved homes could be carried by existing satellite systems, even including the expected incremental growth of those systems over the next ten years; larger numbers of users would require the introduction of new, more cost-efficient satellite systems.
Public support
The preliminary results of this Cost Benefit Analysis highlight that there remains a sizeable demand for broadband within Europe that is unlikely to be met by market forces in the medium term, mostly in rural areas.
The major challenge for Europe is to roll out broadband as quickly as the other competitive world economies. Although market forces can mostly be relied upon to achieve this in urban areas, Europe faces particular challenges in sustaining the economic viability of its rural areas. It is therefore likely that satcom will have an important role to play in the mix of technologies that will be a part in bridging the Digital Divide in rural or less privileged areas of Europe.