Broadband On Demand Cable`s 2020 Vision BROADBAND ON DEMAND: Cable`s 2020 Vision Cable`s 2020Vision Broadband OnDemand ABBREVIATIONS POLICY IMPLICATIONS DIGITAL INCLUSION: ELECTRONIC COMMERCE: AFFORDABILITY: BROADBAND PENETRATION: ULTRA HIGHSPEED: BROADBAND COVERAGE: BROADBAND TECHNOLOGIES: THE DIGITAL AGENDA: EXECUTIVE SUMMARY ...... Low broadband costs support uptake Lowbroadbandcostssupport ...... Cableoperatorstake socialresponsibility 100MBPSwillbecablestandard...... BroadbandonDemand:Cable`s2020Vision Settingthetargets...... Cablebringshighspeedtothehome...... Cable supports entrepreneurship...... Cablesupports

Cable spurs high speed usage...... MovingtowardsNGA...... 04 15 48 45 24 52 10 30 58 42 36

Page 03 Index EXECUTIVE SUMMARY BROADBAND ON DEMAND: Cable`s 2020 Vision BROADBAND ONDEMAND:Cable`s2020Vision EXECUTIVE SUMMAR • of criticalareas. range whole a in outstanding is targets Agenda`s Digital the to contribution industry´s cable European The cable operators. by offered packages telephony and TV,broadband the to subscribe to opt can and operators cable subscribed to broadband cable internet. Europe A across total households of 112m 24m households about are in 2010 the of technical footprint end of the European capability.At internet modernising introduce to in networks investments their substantial made operators cable signals, TV broadcast to established been Cable operators provide European citizens with high very speed access to the digital space. Having originally single digital market, anddigitalinclusion. a levels, speed high ultra and availability broadband improved development: broadband future for the “Digital Agenda for Europe” (referred to as the Digital Agenda), it has now set new ambitious key targets Withmarket. broadband the of development the drives consistently society,(EC) Commission European the knowledge and information modern a towards way Europe´s support To Europe. growing a and for prospering preconditions fundamental as regarded are coverage broad and infrastructure network High-quality • • • • Ultrahighspeed:100Mbpsandmorewillbethecablestandard Broadbandcoverage:cablebringsultrahighspeedto50%ofEUhouseholds al oeaos r oe t prnrhp wt pbi etrrss n re t big lr hg speed high ultra bring to order infrastructure toruralareasthatarecurrentlyunderserved. in enterprises public with partnerships to open are operators Cable households willbewithinthereachofcablebroadbandnetworksdelivering atleast30Mbps. 51% of EU households will be reached with 30 Mbps via cable networks by 2013. By 2020, 55% of EU the widereachofincumbent. matches even cable markets, some In deployments. fibre pure of reach the than greater times several usually is cable European of reach The Mbps. 100 over well and 10 between levels speed delivering Today, 50% of households in the European Union (EU) are within the reach of cable broadband networks speed levelsofupto400Mbps; intestseven1.2-1.4Gbpswerereached. the addition of high-speed data transfer to an existing cable network, cable operators can offer maximum With the ongoing implementation of DOCSIS 3.0 (D3.0), a telecommunications standard that permits that standard telecommunications a (D3.0), 3.0 DOCSIS of implementation ongoing the With surpass theADSL(6Mbps)andADSL2+(<25speed levelsusually offered. offers broadband cable promoted widely most today`s Mbps, 20-25 With common. quite already are Cable operators lead the race to ever higher speed levels. Maximum speed levels of 100 Mbps and more Y

Page 05 Executive summary Page 06 • • • • • •

ffordability: low cost of cable broadband access supports uptake Affordability: lowcostofcablebroadbandaccesssupports Broadband penetration:cableoperatorsspurthebroadbandpenetration The cableindustr ultra highspeedpackages. these using subscribers broadband cable of 70% to close with standard, the be will Mbps 100 least at of usage the 2020 By Mbps. 100 than more even 13% 2013, by Mbps 30 than more with packages take to expected be can subscribers broadband cable European of 50% beginning: the just is this And al oeaos fe ter rabn pcae a sgiiaty oe pie ta theincumbent. than prices lower significantly Discounts rangebetween20% and50%. at packages broadband their offer operators Cable price wasonly36%ofthe2005 price,whiletheaverageDSLprice wasonlyreducedto46%. broadband cable 2008 average the data, OECD recent most to according operators: DSL than quickly and more,comparedtoonly29%inthetotalEuropeanbroadband subscriber base. the use of very high internet speeds: 73% of cable subscribers are currently taking packages of 10 Mbps spearheading are users broadband cable bundles, low-price speed, high attractive highly by Supported can successfullyactivatethecurrentlyunconnectedcablehouseholds within theirnetwork reach. to 27% of the ultra high speed EU penetration target. And there is a significant upside if cable operators By 2020 at least 27m European households are expected to subscribe to 100 Mpbs and more – relating much faster: cable-drivenmarkets areusually2to2.5yearsaheadoftheir DSL-only peers. 30% higher than in markets that focus on competition.service And higher penetration rates are reached over are that rates penetration broadband achieve competition infrastructure cable-driven Marketswith vr h ps fw er cbe prtr have operators cable years few past the Over Digital Inclusion Electronic Commerce Broadband penetration Broadband coverage commerce medium enterprisesinelectronic and Support participationofsmall to internetconnectionsof100Mbps 50% ormoreofEUhouseholdssubscribe Europeans by2020 30 Mbps+internetaccessforall Europeans by2013 all Broadband internetaccessfor disadvantaged peopleby2015 disadvantaged Foster digitalinclusionof

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for small/homeoffices Roll outofbroadband 0.5% 2010 41% 50% erae te rc o bodad ces uh more much access broadband of price the decreased medium enterprises Expansion tosmall/ al Agenda’s overall t 2013 52% 51% 4% medium enterprises Full offerforsmall/ 5 2020 55% 27% 5% argets

• • • • • • forthefuturedevelopmentofEuropeancableindustry.important especially are areas policy Six enterprises. and households both to broadband speed high very bringing and market broadband the reshaping in industry cable the support should policy-makers national and European • • • • • Continued support ofinfrastructure-based competition Continuedsupport cableasaleadingNext Supporting GenerationAccess(NGA)network DigitalInclusion:cableoperatorstakesocialresponsibility entrepreneurship ElectronicCommerce:cablesupports platforms, beitfixed,cableor mobile. various between competition infrastructure of lack a is there when only models access open Introduce rollout. Higher terminationfeesintoNGAscancreateincentivesforfurther Cost ofregulatedaccessshouldnotdiscourageinvestmentinto newNGA infrastructures. Treat cableandfibreequallywhenitcomestopublicsupport. has thepotentialtojeopardisecableinvestment. Develop an NGA policy that continues to encourage investment and innovation. Specific access regulation with achancetowork. Create a regulatory regime that spurs investment in NGAs and provides infrastructure-based competition safely andeffectively. increase digital literacy and create opportunities by qualifying citizens to use digital products and services internet, the of use regular the facilitate that programmes of range a support operators cable European digitalinclusion.Cable operatorsacrossEuropeworkintenselyonsupporting inelectroniccommerce. participating operators, Cable market. SME underserved therefore, contribute to the “eCommunication currently Directives” target of increasing the share of SMEs actively the for especially packages, business priced attractively offer to networks speed high upgraded their leveraging are Europe across operators Cable and medium enterprises(SMEs)inelectroniccommerceandcollaboration. small of participation successful the for prerequisite a is access broadband secure and Reliable groups. formanydigitallyexcludedsocio-economic to entry also it and broadband cable supports an inclusive of information society, uptake as high overall broadband access costs the are among the biggest spurring barriers is proposition price-value attractive The

Page 07 Executive summary Page 08 • • • • • • • • • Stateaid:carefuluseofpublicfunds Dataprotection:trustasfuelfortheigitalAgenda cableinitsroleaskeycontendertotelecomincumbents Supporting Movingtowardsabalancednetneutralityapproach simple sanctionsshouldprovideremediesforconsumers. Sanctions serve as decent deterrents to the abuse of personal data. Wherever rules are broken, clear and data areadequatelyprotected. and consumers`privacy that ensure therefore, must, Companies offers. broadband their with consumer Being trusted by consumers is paramount to businesses (such as cable operators) that mainly target the cable`s sustaining of means a as contender roleininfrastructurecompetition. supported generally be should level national a on Consolidation compared totheirmaincompetitors,theincumbents. Cable operators remain sub-scale in terms of financial resources, purchasing power and marketing reach anti- behave that companies individual tackling competitively. for tools excellent provide rules competition and It is important to apply appropriate sanctions to those who break the rules. The new “Telecom Package” guarantee apositiveonlineexperience. role The of EC legal recognises and the transparent important traffic management practices designed to tothemarketmust beproportionate failurethatitintendstocorrect. aid State support. public of case the in critical Transparentare proceedings neutral technologically and characterised byapersistentlackofcommercialinitiatives. Public support must concentrate on developing networks in those areas that, due to market failures, are same the with technologies NGA dedication. all support and neutral technologically be should support Public Page 09 Executive summary The Digital Agenda: setting the targets 4 3 2 1 Setting thetargets THE DIGIT C(2010)471final. C(2010)6223. C(2010)472. CommunicationbyMrs.NeelieKroes, Vice President oftheECon12March2010. ay ebr tts gvrmns r crety usataig hs tres n dvlpn ter own their developing and national proposalsonthetransition toultrahighspeedbroadband.Examples include: targets these substantiating currently are governments states` member Many of 100Mbpsandabove. Broadband the access to the in internet with at formally least 30 Mbps, with more 50% or more developed of European households having been subscriptions has target This Mbps. Communication, explicitly demanding 5 full broadband coverage by 2013. to By 2020 all Europeans relates up should have of indirectly rate video, bit high-definition target as a to such content`, ‘high-quality of transmission the to reference the Yet, formulated. were levels speed targeted or goals availability formal no initiative, i2010 the Within and provideaffordable to secure theobjective by high-bandwidth communications,richanddiversecontent,digital services. underpinned was priority flagship This media. and society information for market internal competitive and open an single promotes that space a information European of completion the was initiative i2010 the within priority a key A for Europe. preconditions growing and fundamental prospering as regarded are coverage wide and infrastructure network High-quality Increasing broadanda well-being.” and prosperity Europe‘s for essential oxygen, digital is broadband “Fast Communication. developing information and communication technology, and the Digital Agenda together with the Broadband for strategy EC`s the defined which initiative, i2010 the in both targets, these of overview an gives chapter following The Agenda. Digital the in set commitments the realise EU the help to aim measures three These • • • measures wereadoptedbytheECinSeptember2010.Thepackagecomprises: speed higher and availability broadband better levels, a single set: digital market, and digital inclusion. been To support the broadband have strategy, three decade complementary next the for targets key Agenda, Digital 2010 the With timeframe. this in accomplished been has success of closely.lot them A monitoring and targets ambitious setting by decade past the marketover broadband the of development the driven has ensure theavailabilityofspectrumforwirelessbroadband. the “Proposal for a decision establishing the first radio spectrum policy programme” policy spectrum radio first the establishing decision a for “Proposal the totelecomoperators; certainty which isintendedtoprovideregulatory (NGA)”, Networks Access Generation Next to access regulated on recommendation “Commission the which outlineshowbesttoencouragepublicandprivateinvestmentin ultrahighspeednetworks; the “European broadband: investing in digitally driven growth”, known as the Broadband Communication, AL AGENDA

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higher speedlevels penetration and availability, broadband Digital Agenda: communication bandwidth secure and i2010: affordable

Page 11 The digital agenda Page 12 and growth supports parallel networks networks parallel one with service service with one Two competing are superiorto Infrastructure Infrastructure productivity competition n o i t i t e p m o c Development:ASimultaneous Approach. 6 5 Directive202/21/EC. For example,Röller&Waverman: Telecommunications InfrastructureandEconomic infrastructures. Where there is a lack of infrastructure competition, regulation has to support service service support to has regulation competition competition, infrastructure Once networks. existing to access infrastructure securing by choice consumer and of competition lack a is there Where infrastructures. ihn t rgltr framework, regulatory its Within • • • economic growthinseveralways. • • • The beneficial impact of a growing telecommunications industry on the overall growth oftheeconomy studies. many growth in overall proven and onthe discussed been has industry telecommunications agrowing of impact beneficial The using thenetworkofincumbent. on rely competitors all which in competition service to superior therefore is It decreases. price steeper and infrastructure particular, In penetration. broadband growing in competition with parallel networks reaching out for new driver subscribers results in higher broadband penetrations key a is competition Broadband Infrastructure competition Broadband i2010 towards theDigit in othersectors,suchasnewjobsandmoreelectroniccommerce. Spillover effect: investment in the telecommunications sector creates significant benefits and investments significantly moreproductive. be to users their allow services and infrastructure telecommunications innovative effect: Productivity directly increasesdemandand,thus,resultsineconomicgrowth. on) so and switches (cable, products network-related for demand increased the effect: growth Direct by 2014. connection Mbps 50 with population the of 75% serve to aims which “Breitbandstrategie” German the by 2012,withaminimumspeedof2Mbps; “Digital Britain” which announced that there should be 100% broadband coverage and universal access speed internetby2011; high to access have citizens` all ensure to objective the formulated which 2012” Numérique “France lower prices. Increased competition/higherspeedsat Full broadbandcoverage. To fixed broadbandaccess. Reduce thebroadbandgap/penetrationof wards broadbandforall. i2010 targets

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argets: broadanda 5 Investment in telecommunications infrastructure spurs infrastructure telecommunications in Investment

By 2020: broadband toallEuropeansby2013. Fast andultrafastinternetaccess:bring 100 Mbps. subscribe tointernetconnectionsabove higher internetspeedsofabove30Mbps 50% ormoreofEuropeanhouseholds all Europeanshaveaccesstomuch v bility andspeed aila Digital Agenda

7 SEC(2010)1037 5 4 3 2 1 Fibre-to-the-Cabinet unbundling Fibre-to-the-Cabinet Fibre-to-the-Home orFibre-to-the-Building plusin-housewiresharing Eitherownorleasedinfrastructure,incl.ductsharing LocalLoopUnbundling Fibre-to-the-Home FTTH Cable DSL ‘L adjust thewholesaleaccessproductstofitintoNGAhierarchy. to have regulators reached, competition of level the maintain to order In network. fixed one only support usually areas rural infrastructures, fixed 2-3 across support might areas urban vary populated densely While regions. investments and countries infrastructure efficient But customer. end the to closer own it its bringing developing and gradually infrastructure means investment of ladder the up climbing competitor, the for cases, both In and topologyoftheexistingnetworks,looplengths,customerdensitypresencemultidwellingunits). quality example, (for network the of characteristics specific locally utilise to technologies of mixture a likelybe to can be seen as a vehicle to infrastructure competition. Moving to NGAs, the most effective deployment strategy is made by a step-by-step approach. The initial step (at the bottom of the ladder) is usually service competition, which The ladder of infrastructure approach assumes that new and competitors` infrastructure services investments are Infobox: ofinvestment the‘ladder will atleastbeshared. deployment fibre of costs the that ensures This networks. fibre parallel of deployment the for infrastructure Technologies”). In the new NGA recommendation, the EC “Broadband is, therefore, promoting access to civil engineering on duplicationof chapter the deployment, (see inefficient orFTTH and costly FTTB usually is a loop fibre of the of segment terminating the thecontext In on competition. impact significant a has networks fibre-based Transitionto cable. copper coaxial from and/or pair is twisted copper by covered mile” usually “last called so the fibre, on based increasingly are infrastructures backhaul and backbone While has developed,accessregulationcanbereduced. core questions. two answer therefore should regulation infrastructure on Policy-makersdeciding regions. many in available Yet, in addition to FTTH and FTTB high deployments, speed very cable as well as wireless networks are also adder ofinvestment

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Page 13 The digital agenda Provide broadband

Page 14 divide andsupport Bridge the digital digital the Bridge access to S to access digital inclusion ME s To ensurethedesiredinfrastructurecompetition, regulatorshavetocreateagenuineandlevelplayingfield. • at anaffordableprice. levels speed higher to access improved with provided be particular, for should in SMEs, prerequisite goals. these reaching key a is infrastructure broadband integrated Powerful, sales. and purchases online more pursue cross-border purchases. Furthermore, it encourages small and medium enterprises (SMEs) to conduct and related communications. It aims for 50% of European citizens (currently 38%) to buy online and 20% to Directives” “eCommunications the of goals the explores further Agenda transparency.Digital increased The and choice greater consumers gives importantly, most but, market single the improves only not It 2009. The reform of the “eCommunications Directives” (known as the Telecom Package) was adopted in November consistency andcreatingalevelplayingfieldforEurope`soperators. creation. Thus, the European Commission barriers, works enhancing towards regulatory removing regulatory wealth of economy.flows digital the the hinder in should case borders the why reason technical no is There more even is this and scale, of economies prevents consumers 500m of market European fragmented The Supporting electroniccommereandentrepreneurship • amongst disadvantagedpeople. sets targets to halve this figure by 2015. It also intends to increase internet use by 15% overall, and by 19% Agenda Digital The skills. of lack and costs need, of lack perceived a is connection broadband a having not 150m Currently, households for reasons main the that groups. shows Evidence internet. the used never have 30%, some Europeans, socio-economic and countries across both skills, digital and internet the of use as a priority objective. The programme has delivered significant progress, but gaps continue to exist in regular the i2010 initiative, the digital inclusion policy was launched with an emphasis on improving digital literacy information society that is inclusive, provides high-quality public and services promotes quality of life. Within a tool to provide excellent returns on investments in the longer term. The i2010 initiative was striving for an For governments facing an ageing population and problems with social exclusion, broadband can be used as Reaching dgit also betaken intoconsideration. can actually get access to competing infrastructures. In addition to fixed lines, mobile technologies must household single a how about discussions be to needs there available, generally least at are networks and, therefore, needs private-public partnerships, especiallyinlessdenselypopulatedareas. and, therefore,needsprivate-publicpartnerships, 2020 targets. However, a full coverage with 30 Mbps might be too ambitious to achieve for cable alone possibility of even higher speed levels in the range of 1.2-1.4 Gbps. This feature would already meet the networks, like DOCSIS 3.0 deployment, speeds of at least 100 Mbps can be reached. Trials showed the coaxial existing of upgrading Withthe needs. customer mid-term meet to needed be not actually might a te xsig nrsrcue et oeae n sed requirements? speed and coverage meet infrastructure existing the Can w hud nrsrcue optto b approached? be competition infrastructure should How al incl usion andliteracy ne utpe telecommunication multiple Once ir deployment Fibre NGA towards Moving logies: Techno- Broadband

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Page 16 D reaching its speed speed its reaching S L infrastructure infrastructure Moving towardsNGA Broadband Technologies: limits % ofpopulation, endof2008 Fixed broadandcoverageinEurope Source: iDATE, EuropeanCommission, Solon Note: EU-27countries+Norway; dataforSwitzerlandnotavailable intervention is required to generate service competitionontheDSLinfrastructure. isrequiredtogenerateservice intervention regulatory competition, infrastructure of lack a with coupled is this If incumbent. former the by controlled the range of DSL infrastructure. As a legacy telecommunications network, the DSL infrastructure is generally within is population Europe`s of 93% Currently,of Europe. average across an population the of percentage high very a to services broadband delivers DSL all. to services telephony deliver to out rolled once networks access telephone legacy copper-based the of use makes technology This ADSL). version market mass its in usually line, subscriber (digital DSL is infrastructure broadband fixed available widely most the Europe, In be rolledout. (LTE)evolution term long so-called These more. and Mbps 30 of rates however,infrastructures, to have still transfer offer can infrastructures wireless next-generation of range Also, a networks. (HFC) coax fibre hybrid and (FTTH) home the to fibre (FTTB), basement the to fibre (VDSL), line subscriber digital speed high very are These role. crucial a levels. speed high plays deliveringvery of capable networks access fixed-line are infrastructures NGA fixed Typical NGAs of rollout the targets, broadband Agenda`s Digital the reaching In No Cable with cable Cable with 25-50% reach Cable with 50-75% reach >75% reach GR RO NO UK DK CY BG HU MT DE CZ FR SK SE ES EE BE NL PT PL LU AT LV LT SI IE IT FI

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High speedlevelsarerealisedusingacombinationoftwomeasures. the cabinet)networks–butwithasignificantlylargerreach and higher speedlevels. With their street-level fibre backbones, HFC networks are essentially comparable to VDSL and FTTC (fibre to the introduction of back-channel capability and the integration of optical fibre into the pure coax infrastructure. Over the past decade, operators made substantial investments in modernising their networks, which included offeredbycableoperators. services the technical footprint of cable networks and can, generally, opt to subscribe to TV, broadband and telephony speed cable internet packages. The actual reach is even larger: a total of 112m European households are in high to subscribing Europe across households 24m with service, important most second operators’ cable the is access internet Broadband access. TV usually service, cable one least at take households EU 67m Currently,signals. TV transmitting of purpose sole the Historically,with deployed were networks cable most Cable andHybridF of gaming. of and innovative applications B2B such services as eHealth, electrical smart grids, or on the consumer side lot a by required are transmission, in delays time minimal is that times, latency Short services. computing (B2B) cloud internet-based use business-to-business or internet the over time the real in collaborate in partners business where environment, required especially is speeds up-load and down- of symmetry high A particular, the increased distribution of video content over the internet needs ever-growing download speeds. Key performance indicators for an NGA technology are down- and up-load speeds as well as latency times. In Performance ofNGAthnologies the understand to andinvestmentprofileofthedifferentbroadbandtechnologies. performance essential is it Agenda, Digital the on operators cable of impact the appreciate fully To beginning toseelarge-scalefibrerollouts. just are countries European bigger the of most while markets, smaller in found usually are footprints fibre Larger rollout. of complexity the and costs investment high by driven is it as slowly increase only will that share a networks: fibre of reach the within are households European of 15% Currently,about utilities. only The rollout of pure FTTB and FTTH networks has just started, usually driven by either the incumbent or local withtelecomsincumbents. xDSL playanequalroleandcompetehead-to-head reach (>75% of all households), such as the Netherlands, Belgium, Portugal, Bulgaria and Malta, cable and European markets, cable networks of reach more than half 50% of all than households. In countries with more a very high cable In network Europe. across significantly varies networks cable of networks. availability cable However,existing of reach within was population European the of 52% 2008, of end the at data, EC/iDate recent most the to According Europe. in infrastructure access important most second the is Cable ibre Coax(HFC)infrastructure limited fibrereach very with countries most – started just F networks cable by covered is the EUpopulation More than50%of Mbps 400 to up providing of capable networks upgrade level,cable W ibre rollout has has rollout ibre ith current current ith

Page 17 Broadband Technologies Page 18 high ultra to cable DO deep fibremove CSIS 3.0 and and 3.0 CSIS speed levels 9 8 LargestSwisscable operator LargestGermancableoperator • Mbps, 2010 Broadband technologies: maxmudownloadspeed levelsin2010 • Source: Solon, Wikipedia, Nordig and HFCnetworks. Increasing bandwidth efficiency.bandwidth Increasing Cluster splits and deep-fibre deployment. deep-fibre and splits Cluster been undertaken by Kabel Deutschland recently have tests field Respective possible. are Gbps 1.4 to up of speeds download even standards, compression digital improved with 3.0 DOCSIS combining by that, shows research Current sec). (m milliseconds 5-8 at low very usually are networks broadband cable of times Latency reached. be can Mbps 108 to up of out speeds upload rolling and Mbps By 400 and 100 services. between speeds broadband download 3.0, by DOCSIS used capacity the optimises that technology a 3.0, DOCSIS more efficiently, for example, by freeing capacity through the digitisation of TV channels or by introducing times. latency lower even reach and offers symmetric more towards move 3.0, DOCSIS of levels speed high already the exceed will networks cable Consequently,future FTTH. and FTTB towards path evolution andbringfibre cluster this split gradually closer to the home. Their fibre-powered HFC networks, essentially, can therefore, follow a gradual cableoperators insufficient, becomes cluster network specific D 2.0 Cable /HFC 5-8 32 D 3.0 400 5-8

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Page 19 Broadband Technologies Page 20 efficient thanfibre differences: cable cable differences: the heart of cable cable of heart the competetive with with competetive Strong economic F upgrade more more upgrade ibre is also at at also is ibre and and modern cable cable modern O broadband F networks nly nly TT rollout H F TTB TTB are are Optical Network)orP2P(Point toPoint) Ethernet. When deployingFTTH, operatorscanselectbetweentwonetworkarchitectures:GPON(GigabitPassive • Gradual evolutiontowardsfibreforbothcableandfixed line • • can bejeopardisedwithastronger focusoncableaccessregulation. rollout NGA efficient highly their into operators cable of activity investment strong current the that mind, in particular of be consideration when it comes to public financing in the form of, for must example, subsidies. It also has to be kept deployment) rural versus (urban scenarios rollout different to approaches NGA the of suitability the and needs investment specific The approach. demand-driven cost-effective, highly a with fibre deploy and networks their across levels speed high very reach quickly to 3.0 DOCSIS of introduction low-cost the use operators Cable investment. upfront high require operators fibre alternative and incumbent the by used approaches FTTx impact. economic their in differences strong show strategies NGA various The Economics ofNGAtechnologies respective mobilecell.Urbanregions,inparticular, willseechallenges inrealisingmaximumspeedlevels. mobile as Yet, regions. populated the within usage concurrent the less on heavily depend will capacity actual the medium, in shared a is broadband especially consumer end the to levels speed higher bring will deployment strategies used by the incumbent and alternative fibre operators. Mobile broadband technologies FTTH and FTTB of case the in as investments upfront high require not does that approach demand- gradual driven, more a through fibre deploy to able are operators cable splits, cluster through However, home. the to closer fibre bringing on rely strategies NGA Ultimately,operators’ cable the and incumbents’ the both • to 100Mbps.Latencytimesarenegligible. up of speeds upload and Mbps 500-1000 of range the in levels speed download maximum supporting aiu dwsra bnwdh f p o 0 Mp, eedn o te egh f h titd pair twisted the of in-house wiring;upstreamcanreach20Mbpsandlatencyisatalow 4-6msec. length the on depending fora Mbps, 200 to allows up FTTB of length, bandwidth loop downstream final maximum the on Depending distribution. in-house the for used is wiring FTTB: GPON FTTH: In especially theincumbents,currentlyoptforGPONwhenrealisingtheir FTTHdeployments. Consequently,distribution. operators, TV fibre point-to-multipoint most classical the for usability better use of a single fibre for multiple homes has two core advantages: lower investment costs per home and and The Gbps fibre. the of users the all 2.5 by shared However,be Gbps. to 1.25 have to these up to of speeds upload up of streams download supports GPON premises. multiple serve to fibre single a environments ratherthanresidentialconsumers. for classical TV distribution. P2P Ethernet is, therefore, better for bringing fiibre to business-to-business suitable less is technology the and costs) operational lower by offset (partly costly more is deployment GPON, to compared cost: certain however, a approach, at Ethernet comes P2P the of flexibility higher household is, therefore, fully scalable and symmetric, and allows for speed levels of up to 10 Gbps. The P2P is a fibre-optic access network technology, in which passive optical splitters are used to enable to used are splitters technology, optical network passive access which fibre-optic in a is the most advanced networks deploy fibre all the way to the customer’s premises, thereby premises, thecustomer’s to way the all fibre deploy networks advanced most the fibre is deployed to the basement of a multi-dwelling unit building, while the existing copper existing the while building, unit multi-dwelling a of basement the to deployed is fibre Ethernet infrastructures every home gets its own fibre. The bandwidth available to a single a to available bandwidth The fibre. own its gets home every infrastructures the cable network, plus the modem for every activesubscriber.the cablenetwork,plusmodemforevery scenario approximately rollout greenfield this In available. is network cable no if necessary only are investments Higher Source: EuropeanCommission, Solon D 3.0=DOCSIS € perhouseholdexcluding modem Investment requirementsofurbanNGAdeployments • • tobe have two cases Here, footage. significant a show differentiated. already networks cable areas urban many In Economics ofcable-basedNGAinurbanareas upgraded cable D 3.0rolloutin every activecablebroadbandsubscriberrequiresamodem,whichadds€30-50. every € paid, plus the modem investment for every activesubscriber.paid, plusthemodeminvestmentforevery deliver the internet. In this case, only the DOCSIS 3.0 investment of Upgraded cable network: cable Upgraded network: cable Non-upgraded investment of investment 150-180 for renewing in-house cabling, and 5-10 300-400 upfront investment is sufficient to connect a new internet-enabled household to household internet-enabled new a connect to sufficient is investment upfront 300-400 €

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30-50 is needed for the upgrade of the street network, street the of upgrade the for needed is 30-50 € 5-10 for the implementation of DOCSIS 3.0. In addition, VDS L 300-500 upgrade FTTB deployment DSL € 5-10 per home passed has to be /FTTBFTTH 500-1000 FTTH deployment

1000-2000

rollout upto greenfield home, per more than no cable of Upgrade €

240 240 € 400

Page 21 Broadband Technologies household for for household partnerships might might partnerships

Page 22 for solution the be rollout: and FTTHcanbe rural NGArollout Public-private Public-private up to Costly fibre fibre Costly € 500per € 2000 F TTC, TTC, gna s teeoe te oriain f rudok cos h ifatutrs n poiig improved providing and infrastructures access topreexistingducts.Bothhavethepotentialdecrease costofagreenfieldfibrerollout. the across groundwork of Digital coordination the the of requirement therefore, key is, A Agenda groundwork. labour-intense is FTTx out rolling in driver cost main The at rabn fr ua aes te rsne f al ntok i tee ein i rltvl lw A high A low. relatively is regions approximately of requirement investment these in networks cable of presence the areas, rural for broadband fast cable network upgrades and DOCSIS 3.0 rollout still prove to be the most cost-effective option for delivering Rural areas are usually confronted with significantly higher costs for the rollout of new NGA networks. While Deployment ofNGAinruralareas • • • expansion ofexistingcablenetworks.Costsareonlycomparableifno networkisavailable. and upgrade the than costly more significantly is FTTx of rollout the areas, urban populated densely in Even Economics ofFTTx-basedNGAinurbanareas the reasonbehindsuccess of cablebroadbandinthepastfewyears. available to broadband access. This unique combination of low rollout costs and attractive features has been networks are ‘naturally’ equipped with high capacity. It only requires limited investment to make this capacity same time, it the is comparatively inexpensive At to develop an alike. existing cable network. businesses As TV distribution and networks, cable consumers by internet speed high very of uptake the supporting thus, and, applications internet modern by required times latency low and levels speed high very the providing of capable are they features: of set attractive very a show networks cable modernised continuously Overall, Cable asfuture-proofNGA partnerships. public-private by realised be could which infrastructures, FTTx or cable in investments need they Mpbs 30 expected to become a valid investment case for rural areas. However, to reach higher speed levels of at least are LTEnetworks areas, urban in complement broadband mobile a of something being While average. on Mbps, 12 exceed not will bandwidth practical areas, urban of case the in as usage, parallel of level high a viable becoming are Yet,with Mbps. networks, 100 to up of LTElevels speed support to able especially be Theoretically,will alternatives. LTEnetworks and technologies, wireless circumstances, these Under several thousandeurosinthecaseofFTTH. to up higher,reach even can is and networks FTTx rural of rollout the for needed investment Yet,the ones. remote and rural than rather areas suburban and urban in expanding on more focusing been have networks a maximumbandwidthof50Mbps. to limited is VDSL Mbps, 400 to up Yet,of areas. levels rural speed in reach can operators cable while basement. approximately € 1000-2000isrequired. FTTH: FTTB: FTTC/VDSL: investments of investments f ir i dpoe al h wy o h cnue’ hm, mnmm prn investment upfront minimum home, a theconsumer’s to way the all deployed is fibre if of € rolling out fibre to the curb, as in the case of VDSL, requires an upfront investment of investment upfront an requires VDSL, of case the in as curb, the to fibre out rolling 300-500 per household reached, which is in the range of a greenfield cable expansion 500-1000 per home passed are required for the deployment of fibre to the to fibre of deployment the for required are passed home per 500-1000 € € 1000 for cable greenfield rollout is the reason why cable why reason the is rollout greenfield cable for 1000 800-€ 10 ted amongstleading EuropeancableoperatorsinOctober2010. The results are based on the Solon Cable Survey 2009aswell onasurvey, 2010, conduc- TheresultsarebasedontheSolonCable Survey calledSolonBroadbandSurvey ae o a etnie e o ftr ky efrac idctr cnenn bodad oeae and coverage theDigitalAgenda’snewtargets. toreachandsupport industry broadband concerning cable the indicators of efforts the demonstrate performance to aims report this key costs, access and development future speed penetration, of set extensive an on Based profit fromaccesstoinnovativecablebroadband. also will – operators DSL large the by underserved far so – Increasingly,SMEs subscribers. their to levels speed highest the deliver just than more does cable But customers. their to access broadband speed high During recent years, through heavy investments, cable operators have taken on a leadership role in delivering outstanding. been already has development broadband to industry cable European the of contribution The inclusion. strategy: broadband a digital and commerce within electronic of promotion the and levels, speed higher and availability broadband better targets key prominent set has EC the Agenda, Digital the With worldwide. High speed broadband internet has undoubtedly become a foundation of modern, knowledge-based societies 10 targets the DigitalAgenda’s to industry cable of contribution O utstanding utstanding

Page 23 Broadband Technologies Broadband Coverage: Cable brings high speed to the home 11 Cable bringshighspeedtothehome Broadband Coverage: Intechnicalterms,werefertothisas‘coverage’ or‘reach’ofabroadbandnetwork. European cable operators have identified in becoming the lead provider of very highspeedinternet. European cableoperatorshaveidentifiedinbecomingthelead provider ofvery opportunity the underlines 3.0 DOCSIS of rollout accelerated This more. and bandwidth Mbps 100-200 to access get to homes their enabling standard, 3.0 DOCSIS the to set fully be will them of all to close 2013, of end the By 2010. of end the by upgraded be would they thought operators cable surveyed the of 100% to 90% Already ago. year a just expected operators cable the than faster much proceeding is introduction 3.0 launch was behind schedule in only two markets: Luxembourg and Cyprus. Remarkably, the DOCSIS 3.0 The implementation of DOCSIS 3.0 is currently in full swing across Europe. By the end of 2010, the DOCSIS DOCSIS 3.0rolloutinfullswing triggered have operators cable VDSLandfibrerollout. competition andforcedtheircompetitors,especiallyincumbents,to investinfurther Mbps, 30-100 of range the in levels speed of introduction the Following firstly withtherolloutofDOCSIS3.0and,secondly, DOCSIS 3.0withdeepfibredeployment. supporting upgraded, available speed levels are increased with two approaches: cable operators’ networks are two-way Once targets. broadband Agenda’s Digital the reaching in role crucial a play will operators cable this, With overcableby2020. speed internetservices a result, at least 95% of households in the reach of European cable networks will be able to subscribe to As high feasible. economically where years, few next the over activities upgrade their completing others the cable European with – upgraded fully surveyed even are half to ready.close players, Westerntwo-way the European the are Of operators of networks the within households the of 90% About services. broadband bandwidth high providing of capable thus, and, upgraded two-way Currently,are networks cable of (two-way). majority vast the network e-communications fledged fully a to (one-way) platform distribution video Over the past few years, cable operators have made a strong effort to upgrade their networks from a broadcast DOCSIS 3.0rollout andfibredeplo yment more and Mbps 30 of speeds internet higher much to access have should Europeans all 2020 By 2013. by access internet broadband with Europeans all provide to is Agenda Digital the in out set explicitly targets fundamental most the of One chapter aims to outline the crucial role of the cable industry inreachingthesetargetstheDigitalAgenda. chapter aimstooutlinethecrucialroleofcableindustry following the Thus, customers. their to access broadband speed high delivering in extraordinarily performed 11 Drn rcn yas truh ev ivsmns cbe prtr have operators cable investments, heavy through years, recent During . upgraded two-way already networks cable of majority Vast 2013 to becompletedby DOCSIS 3.0rollout

Page 25 BROADBAND COVERAGE Page 26 gains momentum momentum gains cable operators F ibre rollout of of rollout ibre Source: Solon Cable Survey 2009, Solon Broadband Survey 2010 2009,Solon BroadbandSurvey Source: SolonCableSurvey share oftheircustomers. such as Numerciable in France, started with deep fibre deployments and deliver FTTB or FTTH for a growing operators, few capacity.A bandwidth additional for need ever-increasing customers’ their to adapt to node the to fibre deployed have operators cable European of majority the 3.0, DOCSIS of rollout the to Parallel Source: MerrillLynch, Screendigest,companyinformation, Solon DOCSIS 3.0rollout st % ofhomesservedbyDOCSIS3.0 DOCSIS 3.0rollout ofEuropeancableoera 2008a 99% 1%

Survey 2009 2010e 80% 20% a tus withinEuropeancablemarkets

2012e 41% 59%

2010e 82% 18%

tors Survey 2010 2013e 98% 3%

2020e 100%

Not yetlaunched Launched in2010/11 Launched in2009 Launched in2008 DOCSIS 2.0 DOCSIS 3.0 urban areas.To closetheurban-ruralgap,statesubsidiesorpublic-private projectsareessential. networks instead. Consequently, the rollout of fibre is likely to remain limited and concentrated on populated not would mobile their out rolling and frequencies expensive buying on resources their concentrated and fibre in invest they that decided deliberately incumbents telecom many century new the of beginning the At Source: CullenInternational,Solon % ofhouseholds,2010,selectmarkets Coverage ofnetworkswith100Mbpsandmore compared toFTTB/FTTH. case study on the next page shows cable´s strong footprint in reaching the EU broadband goals in Germany, fibre networks. In close to half of the European markets, fibre does not cable even reach 5% of the population. asupgraded The of reach within aswidespread is population European the of 15% only is only average, On markets. few very a in players infrastructures fibre pure of coverage FTTB/FTTH time, same the At availability of very high speed cable access is, therefore, rather driven by the general reach of cable networks. overall networks; cable most in available widely already is 3.0 DOCSIS rollout. NGA fast and successful for With their ultra high speed levels and wide reach, modernised cable broadband networks are the benchmark operators evenexpecttoreachup70%oftheirhouseholdswitha FTTBoraFTTHapproach. cable Some come. to years the in rollout fibre deeper implement to expect Others demand. market meet to of their current HFC networks. Some cable operators assess their current HFC network to have ample capacity Cable operators have different upgrade strategies to meet market demand in 2020, depending on the condition 6% NL 90%

60% BE

30% DK 55%

4% PT 50%

0.5% UK 50%

30% CH

1% 1 AT 25%

% DE 23%

2% ES 16% DOCSIS 3.0 FTTH/FTTB

3% FR 12%

9% IT deployment for benchmark is broadband M odernised cable cable odernised NGA

Page 27 BROADBAND COVERAGE Page 28 will cable 2020, By cover 55%ofEU households with 100 100 M bps+ bps+ increase to55%(currently112mhouseholds). will this 2020 by Mbps, 100 least at with households) 103m (currently households EU of 51% cover will DOCSIS 3.0 rollout, speed levels of 100 Mbps and more will become the standard. By 2013, cable networks reaching the Digital Agenda’s coverage target of nationwide availability of 30 Mbps by 2020. Completing the to contributors core be will industries cable national of majority the Withthis, 2020. by households) 112m EU of half than more serving of households (this capable is 101m households) with broadband access of at least 30 Mbps, going up to 55% (this is currently is industry cable the networks upgraded their Using Cable´s contributioEUverage Source: Bundesnetzagentur, companyinformation, ANGA,Solon m, householdswithinEU-27 Cable coveragethroughoutEurope Case stud Source: Screen Digest, Solon Broadband Survey 2010 Source: ScreenDigest, SolonBroadbandSurvey T echnology coverage coverage reach cable Out of Overall

y : reachingthe2013broadandgoalsnGermany 2010e (<1 Mbps) 11 101 ( 8% (>2 Mbps) 83 Homes reachedbycabl 2 16 Mbps)

70% DSL (1 Mbps)

22% households ADSL/VDS extensive 98% of coverage (50 L 27% VDSL Mbps)

e 2013e 103 105

To tal EUhouseholds:203m DOCSIS 2.0 (32 Mbps) 60%

Cable (HFC)network wide coverage households 68% of ( DOCSIS 3.0 (until 2012)

400 Mbps) (2010) 40% +20%

argets 11 11 Fibre network(FTTB/H) 2020e 8 <1% ofhouseholds 2

spotty coverage at least100Mbps Homes upgradedto at least30Mbps Homes upgradedto FTTB /FTTH ( 400 Mbps) 1%

usage rates. by Mbps maketo subscribers to up then is It 2020. broadband targeted the reach help and levels speed these of use 30 of availability nationwide of that particular in targets, coverage speed high Agenda’s Digital the to contributors key be to continue will operators cable investment, continued With NGA. one number the cable making is 3.0 DOCSIS of rollout ongoing The rollouts. greenfield and upgrades network further with a significant presence in the majority of European markets and incremental expansion potential through landscape broadband European the in position second prominent a occupies currently cable summary, In broadband incumbent–intermsofbothsizeandreach. the of national consolidation cable industries should continued be reviewed The in the light infrastructure. of generating broadband a level playing their field againstgrow the national further to reaching size in industry operators critical cable a support to appropriate seems it comparison, this of background the Against of investmentlevels,salesandmarketing powerarenotpossible. active incumbent. National cable broadband campaigns that could match the incumbent’s activities in terms nationally the to compared if especially operators, cable of power market relative the reducing significantly is This Germany,Denmark. as or Polandsuch markets some for hundreds the in counts operators cable of fragmentation, usually with at least 2-3 cable operators being active, each in its distinctive area. The number regional by characterised still are markets cable smaller,most even as is operators cable single of size The Source: Solon *** IncludingBskyB,SkyItaliaandDeutschland Global,incl.UPCBroadbandandShareinTelenet; revenueforEuropeancable;**AllcableassetsofLiberty * Industry € bn,millionsubscribers2009 telecommunica Size andreachofEuropeanablendustr terms ofrevenueandsubscribers. in both multinationals, telecom major other than scale industry smaller significantly a on operates below, Even the largest European cable entity, described by the combined cable assets of Liberty Global in the chart large the of incumbents. networks the on based competition service creating on focus still regulators European the of most time, same the competition.at infrastructure since, sustainable remarkable create especially to is This able is market,yet DSL consolidated increasingly the industry,of cable fraction the a how being mention to When considering cable operators’ contribution to the availability high of speed very networks it is important In Corporate revenue* EU subscribers Mobile Broadband Te TV bn

lephony

tion mul European Cable/ EU LGIEurope 17 22 19 62 tis andsa LGIEU** 0 4 5 6 15 1 tellite providers 15 Deutsche Te 38 lekom 11 65 8

y comp O2/T 1 8 16 elefonica ared toinerna 67 57 3 14 Orange 45

46 89 tional 0 2 3 10 Sky EU*** 10

small industry scale small industry are stillrunningon E to telcoincumbent subcritical compared are operators Cable terms ofreach one NGAnetworkin number is Cable U cable operators operators cable U

Page 29 BROADBAND COVERAGE Ultra high speed: 100 mbps will be cable standard 100 MBPSwillbecablestandard Ul Mbps, 2010 incumbent Maximu bandwidth offersacrossEupe:bleoera speed cableoffersis8timeshigher. operators even provide speed levels which are 5 times faster than the incumbent’s offer; and in Bulgaria the only a few incumbents reach speeds levels of more than 50 Mbps. In Switzerland, Belgium and Spain, cable networks, cable many in standard become has Mbps 100 While incumbent. the than bandwidth maximum higher a offer operators cable markets, European all of Currently,85% networks. in their throughout levels With the introduction of DOCSIS 3.0, cable operators lead the speed development and offer the highest speed Bandwidth offerng by cablesubscribers. up picked be to ready – operators cable by offered are packages Already,Mbps today,bandwidth. 100 for demands consumers’ satisfy to position comfortable a in be will operators cable networks, NGA their With chapter discusses the speed and levels fixed-lineoffered operatorsby todaycable andindustry in the future. as video streaming, file sharing and online gaming, the appetite for bandwidth will continue to increase. This The Digital Agenda also highlights the of importance ever higher access speeds. Driven by applications such tra highspeed: Source: Companyinformation, Solon Note: EU-27countriesexcl.ItalyandGreece (nocablecoverage)+SwitzerlandandNorway 100 150 200 250 300 50 0 1.5 2.03.01.03.35.01.41.32.5 PT FI NL

SE FR W DE estern Europe AT

CH BE NO Speed levelofcablextimeshigherthan incumbent UK MT Cable

DK

ES IE

Incumbent EE 1.5 1.26.00.56.33.38.32.5 SI

HU Central andEasternEurope tors comp SK PL

LV ared tohe LT CZ RO BG LU CY than incumbent bandwidth higher offers generally DO CSIS 3.0 3.0 CSIS

Page 31 Ultra High Speed video services drivevideo services increase within the the within increase Cable speed levels levels speed Cable Page 32 Bandwidth-hungry growing demand will significantly next threeyears the consumer. of demand bandwidth the driving now are and ‘fibre-specific’ be to declared formerly were services added value- Such networks. cable into way their making are offers TV web or IPTV Increasingly,own offering. their in this including already operators of 50% with suit following is TV Catch-up operators. cable many of offering TV digital standard the to belongs already Video-on-demand video. online as such applications and low latency time. With these, cable operators provide the appropriate infrastructure for bandwidth-hungry bandwidth up-stream and down- high with capabilities technical excellent have networks cable Modernised Mbps, 2010eand2013 Download bandwidth: maxmuandmostw idel 25 Mbpsbytheendof2010.Andthisislikely toriseanaverageof60MbpsacrossEuropeby2013. assumes cable the industry most widely promoted cable broadband offers to reach an average speed level of European the operators, cable surveyed the of expectations on Based years. 3 next the within levels speed their adjust significantly to expected also are products broadband cable standard importantly, more Even increase. will which subscribers, of share limited a by takenout only usually offering, lead the only not is It their maximumbandwidthfrom30Mbpsto120Mpbswithinthenext threeyears. quadruple even and levels speed increase to effort radical a particular,planning in are operators, European 100 Mbps across Europe; by 2013, this will have increased to an average of 120 Mbps. Central and Eastern of average an reached have will operators cable by provided bandwidth maximum the 2010, of end the By Asa limits. technical thereby, keeping thespeedcompetitioninmotion. their reached have and, operators fibre and VDSL of rollout the towards shifting are alike contenders DSL and fixed-line incumbents consequence, infrastructure, xDSL legacy their With Source: Solon Broadband Survey 2010 Source: SolonBroadbandSurvey Median Max. 2010e 128 100 Maximum bandwidth 2013e 200 120 Max. Median y promoted Most widelypromotedbandwidth 2010e 100 25 ackage 2013e 128 60 of 2Mbpsandmore. broadband market, cable operators had already managed to move 43% of their subscriber base to packages subscriber. broadband average While in 2006 the the share of broadband than connections with > 2 levels Mbps download speed speed was only 27% in higher the EU for opt to tend subscribers broadband cable consequence, a As Mbps. 400 to up deliver to able already are networks cable limit, speed their reaching are networks ADSL While increasing. is DSL than other technologies access through provided lines of share The overall market includes both DSL and cable networks, and, increasingly, also fibre access. However, the broadband lineshadspeedsofatleast10Mbps,upfrom13% twoyears earlier. applications, actual user demand for higher-speed packages has increased rapidly. In July 2010, 29% of EU ever-increasingthe by Driven Mbps. 10 than more of speed download a internet of requirements bandwidth a had still subscriptions internet provide to able were connections the of 6% only and 2006, of in Mbps 2 than less of bandwidth downstream majority vast the market, broadband European total the at Looking especially inthecablesubscriberbase. Europe, across years recent over increased significantly has levels speed higher of uptake actual The base. subscriber the into way their made also have levels ever-higherspeed that surprising not is it this, Knowing Distribution ofbroadbandsubscribersaccordingtobandwidth 2010 2007,2009;SolonBroadbandSurvey Source: SolonCableSurvey Kbps, median Network usage:a traffic isexpectedtocontinuegrowingexponentially. by cable generated traffic the consumption, content broadband subscribers is expanding rapidly. user-generated For the next few years, average peak and downstream and upstream video of uptake the by Driven With their high-speed offers, cable operators both spur and satisfy the growing hunger for greater bandwidth. Consumers’ bandwidth demands 2006 2008 verage peaktrafficersubscrib 2010 2012 2014 2016 2018 2020 Upstream Downstream Survey 2010 Survey 2009 Survey 2007 Survey 2010 Survey 2009 Survey 2007

exponentially per subscribergrows A higher speed levels levels speed higher take subscribers broadband Cable rapidly increased have levels acrossEurope speed Broadband verage peak traffic traffic peak verage

Page 33 Ultra High Speed subscribers arelike- 100 Mbpspackages

Page 34 cable of Two-thirds ly to take at least least at take to ly by 2020 EU broadandspeeddevelopment speed % oftotal broadbandsubscriberscompared tocablesubscribers perdownstream out forthenewpremiumproductof200Mbps+.Thiswould morethanfulfiltheDigitalAgenda’starget. reaching even subscribers of 15-20% another with product, Mbps 100 the for opt to expected be can 50% about these, Of more. or packages Mbps 100 taking subscribers cable of two-thirds of rate penetration a in in Central and Eastern Europe. Applying this development to a forecast of speed distribution in 2020 results broadband connections is expected to radically increase to at least 50% in Western Europe and even to 54% broadband products of 30 Mbps or more at the end of 2010. By 2013, the share of high and to ultra subscribe Europe high across subscribers speed cable of 20% significant a already that show survey 2010 the from in the coming years supported by the availability and attractive prices of cable broadband packages. Findings In particular, within the cable subscriber base, the migration to higher-speed packages is expected to continue 2009 * Splitin2006:<2Mbps,2-8>8Mbps;Source:EuropeanCommission, SolonCableSurvey to 73%ofthecablebroadbandsubscriberbase(compared29% thetotalbroadbandsubscriberbase). more (compared to 16% within the total base). In 2010, the high speed segment (>10 Mbps) has widened and Mbps 10 of packages speed high took subscribers broadband cable of quarter a than more 2008, By targets muchearlierthanrequired, assoondemandfollows. Agenda. Digital the in set as Therefore, target cable operators Mbps across Europe 30 are in the a comfortable of position to short meet the fall Digital Agenda’s just bandwidth only packages standard mass-market the Mbps, 25 of average an at And, 2010. of end the at Mbps) (100 target top-level Agenda’s Digital the broadband future applications. The maximum bandwidth packages of European cable operators either already meet or exceed and present for bandwidth sufficient supply to Europe across race the leading is Cable Cable´s contributioEUul 2006 21% 74% 6%

* European broadbandmarket

2008 13% 62% 25%

2010 29% 58% 13%

: overallmarketcomp 2-10 Mbps <2 Mbps 10 Mbps tra highspeed 2006 57% 42% 1%

European cableoperators ared tocablepera 2008 26% 23% 51%

argets 2010e 73% 18% 9%

tors <2 Mbps 2-10 Mbps 10 Mbps Cable has proven to be a flagship platform that attracts other consumers to very high speed broadband speed high very to internet. consumers other attracts that platform flagship a be to proven has Cable more. and Mbps all 100 with nearly packages have 2020 will 70% In to close packages. and Mbps, speed 30 least high at have of will subscribers terms in adopters early be to seem also subscribers Cable 2010 2009;SolonBroadbandSurvey Source: SolonCableSurvey * Highspeedin2008survey:≥20Mbps % ofcablesubscriberswithrespectivemaximumdownstreambandwidth Distribution ofspeedlevels 2008 24% 69% 7%

2010e 17% 55% 27%

2013e 13% 37% 38% 13%

2020e 69% 22% 7%

(>100 Mbps) Ultra highspeed ( High speed ( Medium speed (<10 Mbps) Low speed 30 Mbps) 10 Mbps)

Page 35 Ultra High Speed Broadband penetra- tion: Cable spurs high speed usage speed usage spurs high tion: Cable penetra- Broadband market shareofalternative infrastructureslower than20%. activelyusebroadband access. 13 12 Cable spurshighspeedusage Broadband penetra competition: Infrastructurecompetition: broadbandmarket shareofalternativeinfrastructures, thatiscableorfibre,largerthan 20%;service Intechnicalterms,werefertotheactual usageofbroadbandas‘broadbandpenetration’: the numberofpeoplewhoactuallysubscribetoand strong cablemarkets withinfrastructure competition. average Whereas in higher) 89% (or Bulgaria). 51% was it 2009, of and end the at countries these Romaniain households of 27% was penetration (Slovakia, market broadband the of share 20% than less for accounts cable where countries three only are there region, this In market. broadband the of development the to beneficial most been have to seems cable of impact the markets, European Eastern and Central In of development. path this following be to seemed also Luxembourg, and France as such markets, Other uptake. broadband broadband market share was slightly below 20%, yet fibre operators got a strong cable foothold and stimulated where the Finland, and Sweden are Examples competition. to contributed players fibre operators, cable to addition in when, levels, penetration high comparably reached only countries households, Low-cable of respectively). 63% and (77% penetration broadband high outstandingly an reached had Belgium, Netherlands and the as such markets, cable strong Especially reach. fibre strong a built already had markets few a also, cable; by driven was competition infrastructure markets, most In 55%). of penetration (average competition service on rely to had infrastructures, alternative of absence the in which, countries European other, strongerandfasterbroadbanduptake. aresupporting the on footprint, direct networks’ cable the and hand, one the on competition, infrastructure how discusses been taken up in specific European markets and the penetration levels that have been reached. This chapter strongly across Europe over the past few years, there are significant differences in how rapidly broadband has 5 o households. of 65% At the end of 2009, penetration in Western European markets with infrastructure competition was on average more attractiveproductsandpriceadjustments. speed, high in investment with suit follow to have incumbents particular,former in the and, operators DSL competitive, Tostay market. mass the for prices lower offering and products broadband faster in investing by incumbent the challenge to first the were operators cable and prevailed competition infrastructure cases competition,on the incumbent’s network. Even though regulation in initially many focused on service-based based competition service on rely mainly which peers, ‘low-cable’ their than penetrations broadband higher have so-called to tend networks the fibre) (and cable market, of presence significant multiple-infrastructure a with Markets competition’. a ‘infrastructure in competition is penetration broadband for driver key A penetra Imp 2020. by Mbps 100 above connections internet to A second prominent target set by the Digital Agenda is that 50% or more of European households subscribe act ofinfrastructurecompetitionbroadand tion 13 This was a significant 18% higher than broadband penetration in thoseWestern in penetration broadband than higher 18% significant a was This 12 lhuh rabn pntain a be growing been has penetration broadband Although tion: penetration levels broadband higher for driver key is competition Infrastructure broadband networks investing infaster by incumbent challenge the to first the were operators Cable

Page 37 Broadband penetration competition pushes pushes competition

Page 38 for fasterdiffusion infrastructure infrastructure of broadband broadband of Cable-driven Cable-driven % ofhouseholds,2009 Broadband penetra of thesemarkets, thedegreeofcompetitionandresulting broadband uptake fellfar behind. loop local after only accelerate most in Still, up. pick to competition service for space to sufficient provided and available became unbundling began uptake broadband a markets, with these peers In their of infrastructure. ahead dominant years 2.5 to close are markets cable-driven Europe, Eastern and Central In infrastructure competition are approximately two years ahead of markets with with markets a focus Europe, Westernon service competition.In level. penetration certain a can hit to it entity,requires each another time much as how seen place be takes competition service where markets other all and entity, single a as considered are competition infrastructure with markets national If diffusion. broadband faster a pushes also Infrastructure competition by cable operators does not only result in higher broadband penetration levels, but Source: Eurostat,Screendigest,Solon high degreeofinfrastructurecompetition, Note:EU-27 countries+SwitzerlandandNorway 3) Althoughcablemarket shareisslightlylessthan20% inSwedenandFinland, strongfibrepresencesuggest 2) Market shareofCableandFibre <20%, 1) Market shareofCableandFibre >20%, 62% 79% CH EE

56% 79% SE SI

3 51% 78% NO HU

Infrastructure competitio Infrastructure competitio 51% 77% NL PL

D 50% 76% L T K

50% 74% LV FI 3

tion inEurope U C 49% 69% K Z

63% BE 63% MT n n

1 1 58% A T Central andEasternEurope

51% ES Ø 65% Ø 51%

W 46% PT estern Europe

42% SK

26% BG

24% Service competitio Service competitio RO

n n 2 2 Ø 27% Ø 55%

Source: Eurostat,Screendigest,Solon % ofhouseholds,2003-2009 Case stud fibre networks)in2010,theGermanmarket competition. canstillbeclassedasamarket withservice for 1% (plus 9% only of share market broadband cable a With uptake. broadband accelerate significantly can competition infrastructure into start late a even that shows market broadband German the of case The Source: Eurostat,Screendigest,Solon Note: EU-27countries+SwitzerlandandNorway % ofhouseholds,2006-2009 Broadband upt competition duetolower 2006 27% 43% local loopcharges 2003 15% 6% 9% Increased DS

y German Markets withinfrastructurecompetition 2004 10% 21% 2007 39% 54% W estern Europe 18%

ake incableandnon- L

Cable operatorsaccelerate 2005 marketing ofbroadband marketing 17% 34% 23% : imp network upgradesand 2008 48% 59% ~2 years

act ofcbleompetitionroadandupt services 34% 2006 27% 43%

2009 55% 65%

2007 39% 54% cable ountries 50%

2008 48% 59% Markets withservicecompetition 2006 22% 55%

7%

Central andEasternEurope 2009 55% 65% 2007 12% 31%

Broadband penetration ~ 2.5years 2008 18% 39% Germany competition Markets withservice infrastructure competition Markets with

ake 2009 27% 51%

Page 39 Broadband penetration Page 40 uptake Broadband cable operators expectations of surpassing the the surpassing is constantly Cable broadbandsubscribersas%ofhomesconnected Broadband penetra expected tocontinuegrowingstronglyovertheyearscome,potentially upto65%by2020. for 2012, as stated in the 2009 survey. Driven by an excellent price-value offering, cable penetration can be expected operators cable level the reached already has penetration broadband cable European 2010 actual penetration regarding broadband uptake has been constantly surpassing the expectations. industry’s At 44%, strongly.Actual growing continue to expected is and years four just in doubled has penetration broadband networks; they also successfully market these high speed services to end consumers. Average European cable EU to broadband contribute penetration. Cable directly operators not also only successfully operators deploy very high cable speed technologies impact, within their positive competition’s infrastructure to addition In Cable´s directfootprntonroadandpenera option. second-best a as perceived be only therefore, can, infrastructure dominant single a on competition Service of Europe’s broadband penetration and digital competitiveness than single infrastructure, DSL-centric markets. In summary, markets with cable-driven infrastructure competition have contributed more to the development broadband penetrationofmarkets withinfrastructurecompetition. average the in gap the closed had Germany 2009, By markets. broadband European Western developed Subsequently, German cable operators are considered to be the main drivers in the catch-up race with more new momentum. Broadband penetration in 2007 jumped from 34% to 50%, compared to the previous year. forced broadband market of entry cable operators (starting in 2006) to give the German broadband uptake a the needed It again. down slowed already had 2005, in which, – uptake broadband stimulated briefly only 2003 in competition service of development subsequent and charges loop local lower of introduction The Source: Solon Cable Survey 2005, 2007, 2009; Solon Broadband Survey 2010 2005,2007, 2009;SolonBroadbandSurvey Source: SolonCableSurvey tion: const antl y surp assing expect

a tions Actual Forecast tion Survey 2010 Survey 2009 Survey 2007 Survey 2005 earlier, driven by cable-based infrastructure competition, incumbents and alternative fixed operators are operators forced toinvestinNGAnetworks andbringultrahighspeedaccess totheircustomers,too. fixed alternative and incumbents competition, infrastructure cable-based by driven earlier, outlined As though. story, the half only is penetration broadband on operators cable of impact direct The 2010 Source: SolonBroadbandSurvey m, householdswithinEU-27 Cable penetra limited networkoverbuildwithFTTBandFTTH. able to activate the current non-cable homes within their network reach. This would by be supported further There mightevenbeasignificantupsideofpossibly51multrahighspeedsubscribersifcableoperatorsare high speedinternetwillbefulfilledbycablesubscribers. by 2020. With this, already a quarter of the Digital Agenda’s target to connect 50% of EU households to ultra At least 27m, or 13%, of EU households are expected to subscribe to 100 Mbps+ cable broadband products Cable´s contributioEUpenera fibreinvestments. stimulate demandforhighspeedinternetthantosubsidisefurther to appropriate more appears it uptake, broadband low a with markets In penetrations. broadband higher The analysis high shows speed that networks the does wide not availability necessarily of translate very into (84%) orSpain(78%),areshowingpenetrationratessignificantly above average. of UK average the as significantly. such differ countries, rates Single penetration (an regions, these within even But peers 36%). European Eastern and Central their than 48%) average (on penetration broadband rates strongly vary across the different markets. Western European cable operators generally display a higher However,penetration the infrastructure, cable broadband upgraded of availability wide generally the despite 11 24 2010e 2

by cabl Homes reached To 0.5/ tal cablebroadbandsubs 1 e

tion throughoutEurope 2013e 6 To tal EUhouseholds:203m 4

tion t 2020e 27 51 5 1 argets 39 11 8 with >100Mbps: Cable broadbandsubscribers Base Scenario Best CaseScenario

2020 2020 by subscriptions 51m 100Mbps+ to up have might industry Cable

Page 41 Broadband penetration Afforda- bility: Low broad- band costs support uptake Low broadband costs support uptakeLow broadbandcostssupport Affordability the aggressive pricing of cable operators. The following analysis compares double-play packages, that is that broadband andtelephony, ofleadingcableoperatorsandtheirincumbents. packages, double-play compares analysis following The operators. cable of on pricing perspective aggressive impressive the more even an provides packages broadband similar of comparison direct The Current pricele vels Source: OECD,Solon Netherlands –cableonly) Note: averageisbasedonthepricedevelopmentinapproximately20countries (Greece, Italy–DSLonly, A Broadband pricedevelopment operators’ cable broadband costsperKbpswereonly36%oftheir2006costs,while DSLplayersonlyhalvedtheircosts. average the 2008, By peers. DSL their to compared adjusted significantly have Kbps operators per cable cost average 2006, Since costs. access broadband reducing in role lead a taken have strategy,this by Driven prices. lower at marketmarketpackages or the speed price at levels operators cable peers and, particularly, the incumbent. In most markets, cable operators, therefore, offer either higher speed DSL their than propositions price-value aggressive more for opted have operators cable compete, to order In Cost development levels. high current its reached have not would penetration years, past the of decrease price broadband strong the Withoutgroups. user income low to available broadband making to and services broadband of adoption the increasing quickly both to driver key a is packages broadband speed high very and high of affordability The verage priceperKbpsofrepresentative broadbandoffers,2005=100% 100% 2005

72% 2006 79%

: 2007 58% 50%

2008 46% 36%

Cable DSL market prices broadband down push opertors Cable

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0.8

ih rabn css r oe f h gets brir t icesd broadband increased to barriers greatest the of one are costs broadband high 1.2 the strong broadband uptake of cable subscribers was clearly driven by cable 27.6 DE 36.4 SK 3.0 Germany Slovakia -23% 21.0 DE -54% 17.0 SK 1.7

0.8

y offers:cableomp 33.9 3.4 ES argets: higherpenetra 24.7 2.5 PL Spain Poland -41% 19.9 1.7 ES -19% P 20.1 2.0

L

1.4 34.9 FR ared toincumben France Czech Republic 27.6 CZ 1.7 -17% 29.9 FR -34%

18.3 1.2 0.7 CZ

tion Mbps Price per Cable Incumbent Mbps Price per Cable Incumbent ’s DSL

Electronic

Telephony and broadband double-play offers: cable compared to incumbent’s DSL Monthly subscription fee and price per Mbps in EUR, price difference in %, 10/2010 commerce: Cable supports entrepre- neurship Page 46 to speed high ultra So brings affordable affordable brings H Cable industry industry Cable os and S and os Cable supports entrepreneurship Cable supports ELECTRONIC COMMERE: ME s 2011 Examples: cabroadandoffert Source: Companyinformation, Solon such as data security software, multi-sitehostingsolutionsorintegratedbusinessapplications. such asdatasecuritysoftware, segments business various for specifically packages service value-added introduced already have operators offers of fixed-line operators for many business customers. The list below indicates that many European cable high 30 Mbps to 100 Mbps in 2020, making cable broadband access a viable and attractive alternative to the large cable operators. Upload speed levels offered to B2B customers are expected to increase from a current some by provided also is access symmetric bandwidth high Very customers. business for essential is which European cable operators are widely capable of providing ultra high speed internet with 100 Mbps and more, equally. by incumbent underserved telco players. Some cable operators target SME customers and large corporations been traditionally,has and, market;it residential the to similar most segment market the is it reasons: two for operators cable for point entry natural the is segment (SoHo) office office/home small the market, B2B the Within years. few last the over rapidly base customer business their growing been have operators cable Several operators. fixed-line by dominated historically were which segments, (B2B) business-to-business the towards expanding progressively is industry cable European economy.the EU mind, the in this Keeping throughout growth and productivity of supporters largest the of one as seen is access internet Broadband UPC Czech Aster UPC Polska Cablecom UPC NL Ziggo UPC Ireland KDG Unitymedia telenet UPC Austria

SoHo Segments SME Corporate argeting thebusinessmarke Ultra highspeed internet (>100 Mbps)

symmetric access Highbandwidth Services

Security H osting applications Business Source: Solon Cable Survey 2010 Source: SolonCableSurvey in Mbps,%ofsubscriberbase Cable B2Bandwidth offerngandconsumpti 2020strategy.clients andsuppliers,asexplicitlydemandedintheEC’s with collaboration online increased or sales and purchases online more of terms in it be online, business their of more move to SMEs encourage increasingly will This opportunities. business of range new whole a speeds, as well as low latency times of cable broadband access, will provide SoHo and SME customers with receive an improved access to higher speed levels at an affordable price. The ultra high download and upload will businesses these services, broadband cable to subscribing By network. broadband cable innovative an to access from profit will operators, DSL particular,large in the customers by SME undervalued traditionally Affordable broadband access is a prerequisite for in successful electronic participation commerce. SoHo and Cable´s contributioEUelectronicommere 2010e 120 30 B2B bandwidthconsumption B2B BandwithOffer 120 2013e 60 2020e 200 100 (Mbps) Speed Upload Standard (Mbps) Speed Upload Maximum

Ultra highspeed Medium speed (>100 Mbps) High speed ( ( 30 Mbps) 10 Mbps) B2B bandwidthconsumption

2010e 20% 75% 5%

2013e 10% 55% 35%

argets 2020e 20% 80%

Page 47 electronic commerce Digital inclusion: cable operators take social responsibi- lity Cable operatorstake socialresponsibility Digit • • identified bytheECini2010 initiative: well as Switzerland. Its “Digital Inclusion Framework” is built on three pillars corresponding to the key areas example is Liberty Global/UPC. In Europe, the company operates cable networks in 10 EU member states as One goals. policy public support that programmes inclusion digital launched actively have operators cable European divides. digital reducing in role flagship a played has industry cable European the years, recent In Cable asadrivingforcebehinddigitalinclusion progress intheseareas,andwillcontinuetodoso. sector,private to The contributed substantively has players, broadband and media of range a especially and • • • • has identifiedandformulatedtheneedforpolicies.Itfocuseson: In order to facilitate the progress of reducing digital divides, the on report “Europe’s Digital Competitiveness” internet andmorecomplexapplications. prohibitive access costs and lack of skills are equipment, still of the lack need, most of lack Perceivedimportant gap. factors social next hindering the be the to uptakeseems transactions) of eCommerce and broadband common, the adoption of complex functionalities (for example, using internet banking, eGovernment services more becomes internet the of use basic While phenomenon. new a is Divide’ Digital ‘Second so-called The Agenda. Digital the for target a remains therefore, and, progress little sparsely very shows areas in remote and living rural populated people the of inclusion time, same the At groups. socio-economic disadvantaged most the of inclusion the increasing to regard with made been has progress Significant inclusive. more become has it and 2008 in population the of 56% to 2005 in 43% from increased has internet the of use Regular regions. less-developed of residents the and unemployed the education, lower with people women, disabilities, with people people, older are groups socio-economic excluded digitally context, this literacy.In digital and use disadvantaged groups and the general EU population, especially in relation to two key areas: regular internet specific targets were set in the “Riga Ministerial Declaration” of 2006 aimed at reducing disparities between of number society.A information inclusive digitally more a of promotion the declared initiative i2010 The enhancing skills (facilitatingdigitalliteracy); widening access(facilitatingregular useofinternet); encouraging theacquisitionofskillsandcontinuouslearning. reducing financialbarriers; facilitating accessfortheoldanddisabled; possibilities andbenefits; encouraging the use of the internet by reducing psychological barriers and increasing familiarity with its al incl usion: social gap re-open functions D ‘Second dedicated projects many with inclusion supports industry E uropean cable cable uropean ivide’: complex complex ivide’: D igital igital

Page 49 Digital inclusion Page 50 wouldcontinuetousethe computerandinternet. andatrainingprogramme).Insurvey, computers,software saidthey 71%oftheparticipants Mediaprovidessheltered housingwitha‘getonline’package (freebroadbandaccessfor ayear, two •Elderlypeople:togetherwithDigitalUnite,anorganisation that helpsolderpeoplegetonline,Virgin securityfortheirparents. areprovidedwithfreeinternetaccessandgivenaninformation packononlineusageandinternet •Childreninlowincomefamilies:collaboratingwithafoundation, childrenacrossfiveUKcities hy r treig aiu gop o dgtly xldd epe wt a ou o cide, h edry and elderly the children, on operatorsandprogrammes includethefollowing. women. Exemplary focus a with people, excluded digitally of groups various targeting are They inclusion. digital supporting are and responsibility social taking are operators cable European other Many inclusion framework;inmanycasesthesehavebeenextendedtomultiple countriesacrossEurope. The below summary shows select initiatives that have been launched by Liberty Global/UPC within its digital • Example: initia • Global/UPC,Solon Source: Liberty opportunities Creating skills Enhancing access Widening securely andeffectively). safely, services and products digital use to qualified and able are users (ensuring opportunities creating Virgin Media(UK)

tives withinLibertyGlos frameworkfordigit bal/UPC’ Ziggo UPC Netherlands UPC Hungary UPC Poland Liberty Global/UPC Liberty Global/UPC UPC Romania UPC Romania Te Te Company lenet (Belgium) lenet (Belgium) Company launchedtwomajorprojectsin2008.

impaired Blind andvisually Elderly Elderly Children teachers Children, parents, organisations Non-governmental Low-income families children andadults Mentally challenged children Underprivileged Ta rget group

Internet accessof256Kbps mation (forexampletalkingbooks) (approx. 350,000)toaccessarangeofspokeninfor- A issues inaneducationalmanner rents, teachersandchildrentoexploreonlinesafety Printed familytoolkit(socalled‘eSafetyKit’)forpa- Providing >300NGOswithfreeinternetaccess Of Te Te computer literacytoseniors provide practicalcoursesondigitalawarenessand A aged 50andover(socalled‘E-Senior T 2010 tohelpprotectchildrenwhileusingtheweb An interactiveeSafetywebsitewaslaunchedinFeb room forunderprivilegedchildrenatthe youth centreinNov2009 classes formentallychallengedchildrenandadults ‘M@turity intheNet’) eaching digitalliteracyandinternetusagetopeople programme called‘ClickonitGrandma’ special internetconnectionthathelpsthesepeople fering low-incomeCA lenet FoundationfundedaprojecttoprovideIC lenet Foundationraised Description TV customersfreebasic 15,000 tobuildacomputer

al incl

Academy’ Antwerp-based in2006to usion and T

society. digital more-inclusive a for push the in role important an plays industry cable the activities, these Through These examples can only highlight a few of the wide range of activities the cable operators have undertaken. • • al oeaos r rahn ot o iavnae scoeooi gop ad epn te acs the access them helping internet. and groups socio-economic disadvantaged to out reaching are operators cable programmes, inclusion digital of range broad a With operators. most for enough not is access broadband priced aggressively affordability.offering on But chapter the in outlined as access, broadband cable of cost low the is ‘approach’ important most The inclusion. digital supporting of means two have operators Cable Cable´s contributioEUdigit • also provide customers with tips on how to find information on topics that interest them. DNA also DNA them. published aseniorguide. interest that topics on information find to how on tips with customers provide also Employees solutions. customised providing and problem their to listening patiently by attention special technologies work, and allows them to try outdifferentproducts. technologies work,andallowsthemtotry insights intonewdigitalopportunities. The website demonstrates how multimedia technologies and services work and gives easy-to-understand DNA- Multimedia Polska (Poland) ws (Austria) Liwest W elho (F elho inland) anhd n nomto cmag fr hs oe 5 yas l t epan how explain to old years 50 over those for campaign information an launched provides a special customer care service for its elderly customers that devotes that customers elderly its for service care customer special a provides launched a multimedia portal to encourage women to use digital media. al incl usion t argets

Page 51 Digital inclusion Policy implica- tions Policy implica consumer isto be thewinner. can do on its own. Ultimately a mix of technologies needs to be deployed in the European marketplace if the telecom cable to that something not is targets compared penetration and coverage full the Yet, cable reaching mobile. and incumbents of footprint small relatively the considering remarkable is broadband target the penetration of 27% least at reaching of contribution potential Cable’s goals. key achieving Agenda’s in Digital role the crucial a plays industry cable European the networks, fast ultra powered, fibre its With Cable Industr inthedailylivesofEuropeancitizens. leading part citizens is something that should not be underestimated. The social value of connectivity continues to play a cable operators and their ICT peers industry have role in providing The access to information assess. and content to to European impossible nearly are an values whose also goods is cultural of but sharing growth, the for economic engine on important focused only not is market ICT the that recognise to important is It • • • • • • a moderninformationsocietyfortheEU’s500mconsumers. Europe’spath to becoming the DigitalAgendashowcriticalrolecableoperatorsaretakinginsupporting Both the analysis of the European cable contribution industry’s to the i2010 initiative and its perspectives on Digital Inclusion:cableoperatorstake socialresponsibility. electronic creative commerce venturesandSMEs. connecting by entrepreneurship supports cable commerce: Electronic Affordability: uptake. lowcostofcablebroadbandaccesssupports Broadband penetration:cableoperatorsspurthebroadbandpenetration. Ultra highspeed:100Mbpsandmorewillbethecablestandard. Broadband coverage:cablealreadybringsbroadbandto50%ofEU households. Digital Inclusion Electronic Commerce Broadband penetration Broadband coverage commerce medium enterprisesinelectronic and Support participationofsmall to internetconnectionsof100Mbps 50% ormoreofEUhouseholdssubscribe Europeans by2020 30 Mbps+internetaccessforall Europeans by2013 all Broadband internetaccessfor disadvantaged peopleby2015 disadvantaged Foster digitalinclusionof y`s contributioheDigit

+

for small/homeoffices Rollout ofbroadband 0.5% 2010 41% 50% tions al Agenda`s overallt medium enterprises Expansion tosmall/ 2013 52% 51% 4% medium enterprises Full offerforsmall/ argets 5 2020 55% 27% 5%

Page 53 Policy implications Page 54 Create regulatory regulatory Create on infrastructure infrastructure on framework that that framework M supports supports aintain focus focus aintain investments competition 14 C(2010)472. NGA • • • consider thefollowingaspects. attractive an maintaining and driving investment climate for in cable and many key other infrastructure players. is A supportive regulatory framework competition should infrastructure-based prioritises that policy A Europe’s economy. market playerswhoseinvestmentdeterminesthewell-beingof bythevery proof’ are alsoconsidered‘future but regulation, better in studies case only not are rules that ensure to crucial is it infrastructures, NGA as positioned equally are networks mobile and FTTx HFC, that fact the accepting When recognised. widely be the incumbents. The Commission’s “Broadband Communication” with compete to positioned well very are and Europe in NGAs first the of one represent therefore, networks, markets. high speed packages of Some up operators to are 120 already Mbps. offering Upgraded very cable networks are at the forefront of these developments in Europe, with 100 Mbps being available in close to all Cable targets. 2020 Agenda’s Digital the reaching in crucial be will NGA of deployment encompassing The cableasleadingNGA Supporting especially criticalforthefuturedevelopmentofEuropeancableindustry. are areas policy Six enterprises. and households both to broadband speed high very bringing and market European and national policy-makers should support the cable industry in reshaping the European broadband A core lever is the development of incentive-compatible pricing of the dominant operator’s wholesaleoffers. A coreleveristhedevelopmentofincentive-compatiblepricing ofthe dominantoperator’s infrastructure. own their in invest to operators alternative Futureencourage to continue also must regulation focus onthefixedmarket. regulatory forces marketplace to efforts look at further the of importance respecting competition law and less at prescriptive rules that only ICT European of ever-changing mix the a in convergence between Yet, competition vital. of is importance technologies the underscoring date, to achieved progress regulatory of light In broadband. fixed challenging increasingly also is broadband mobile spectrum, for uses new Given greatly increasingbroadbandpenetration, reachingever-higher speedlevelsandlowerprices. keyfor a driver been has operators, cable and incumbent the competition,between Infrastructure especially ofinfrastructurecompetition Continued support Treating fiber powered cable and pure FTTB/FTTH networks equally when it comes to supportis to comes it when equally preferable tofocusingtheuseofpublicfundsonfibrenetworks. networks pure FTTB/FTTH and cable powered fiber Treating be overregulated bysymmetricalortechnology-specificregulation. not should such as and contender the still is and cable that invest recognise must to policy The operators innovative. be cable discourages, than rather encourages, that policy NGA an Developing with achancetowork. Creating a regime regulatory that spurs investment in NGAs and provides real infrastructure competition 14 shows that this perspective is starting to down tohowcompaniesshould managetheirnetworksinaworldofrapidlyincreasinginformation flows. boils essentially debate The affected. negatively been actually have citizens that Europe in evidence little is society due to claimed network capacity. While the heated debate continues on both sides of the Atlantic, there information Europe’s from excluded or disenfranchised being potentially citizens around centre debate this in Thereareprobably moredefinitions for ‘net neutrality’ than there are network operators. far,So the concerns Moving towardsabalancednetneutralityapproach • • • NGA pre-existing of acknowledgement the is NGAs competition. for support funding well-guided of precondition A efficient from investment. benefit to able also are initiatives the funding are who citizens the that guarantee will This broadband. mobile or networks fibre pure it be infrastructures, get NGA alternative therefore, as consideration must, same the networks HFC of modernisation and rollout efficient the highly in a Investments strategy. following investment are operators cable approach, rollout demand-driven, evolutionary, the With State aid:carefuluseofpublicfunds • • • Typical incentivesforinfrastructurecompetitioninclude: private investorstodeploytheiraccessnetworksthere. for profitable is it that so lower-populationdensity a with towns to network trunk a funding of form the takecould aid state scratch, from consumers end the to network full a building by initiative private out aids should be proportionate to the market failure they intend to correct. For example, instead of crowding State guaranteed. be must proceedings neutral technology and transparent granted, is support public If more important. even funds public of spending careful makesthe It concerned. is inclusion where Agenda Digital the of component critical a is areas populated densely less and rural Connecting infrastructure. NGA in invest to providers infrastructure private any by initiative commercial of lack persistent a by characterised are failures, market to due that, areas those in networks of development the on focus must Publicfunding to investincable. competitionandreducetheincentive preferred accesstoductsorsubsidies,hasthepotentialdistort by it be networks, fibre future incumbents’ the of especially support, One-sided networks. or LTE fibre National as well as local policy-makers should support cable operators with the same dedication as other between variousplatforms,beitfixed,cableormobile. competition infrastructure of lack a is there when useful only are models access open that recognising increasing terminationfeesforhighspeednetworks,suchascableor FTTx; infrastructures; NGA new in invest to willingness the reduce not does that level a to access regulated of costs setting initiatives commercial of lack if only support Public quality network manage to opportunity with operators Provide

Page 55 Policy implications Page 56 fragmentation and reach criticalsize H e m o c r e v o elp cable cable elp consolidation moves. the to relative operators cable incumbent. Even strengthening so, consideration of competition in the TV market still and stands in the way to many to necessary structures means market a broadband as consolidation sustainable cable developing embrace to started have authorities competition and Policy-makers brands andproductofferings. national develop and reach, national with operations and networks into consolidate can they if competitive more remain speaking, generally will, operators Cable small. comparatively still are operators cable largest the even Vodafone, or Orange Telekom, Deutsche Telefonica, like giants telco international or incumbent NGA leaders and drive infrastructure competition. Yet,the compared to become their competitors, industry be it to the telco managed have operators cable European investments, and innovation of level high a With cableinreachingcriticalsize Supporting those whobreaktherulesasopposedtoregulatinganentiresector forapotentialissue. to sanctions appropriate applying between distinction important anti-competitively.an behave is that There There are excellent tools in the new “Telecom Package” and competition rules for tackling individual companies guidance toregulatorsandstakeholders alike inthisarea. consultation that served as a basis for the sweeping reform of the European telecoms legislation and provides online experience, regardless of platform or package. It is also important to recall the exhaustive nature of the positive a users business and consumers both guarantee to designed are that practices management traffic transparent and legal of role important the recognised has Commission European the that noting worth is It association, CableEurope,donotblockcontentorapplications. industry to a basic internet offer or opt for Toa premium service. this support experience, members of Europe’s cable Fibre-backed cable broadband access improves the internet experience for consumers, whether they subscribe operators. ever-increasingof the light in network for challenges pressing most the of beone to out traffic turns services these of functionality and quality capacity.the network Ensuring greater for need the push to continue will are placing pressure on some networks. Advanced activities two-way such as gaming and video applications Downstream online video offers such as YouTube and Netflix/Lovefilm are examples of the heavy data flows that the strategicoptionstopromotedevelopmentofbroadbandmarket. Source: BelgianInstituteforPostal andTelecommunications Services (4/2009):Consultationattherequestofministeron incumbent Belgacom. telecom the with competition infrastructure head-to-head in engage and invest to mass critical the have could operator Walloniansingle cable consolidated, a only that assumed WallonianIt market.fragmented cable the of consolidation the supporting evaluate suggested study to the measures, office, other Amongst regulatory market. broadband Belgian the improve the IBPT,could that by options different commissioned was study A products. broadband attractive and WallonianThe marketbroadband market Flanders the behind lagging penetration significantly broadband was of terms in Example: consolida tion ofcabletosupporinfrastructureompetiti 15 Over-the-top: Platformindependent, webTVoffers. the high-quality services thatmeetboth needsandbudget. the high-qualityservices deliver best can platform which considering when seat driving the in consumer the puts platforms between the explain to helps This Competition competition. infrastructure-based of performance. importance the of message like and drumbeat industry’s cable price on compete to forced are players as offerings service diverse more create marketplaces Competitive possible. market competitive most the offering by consumer The cable and industry those devising regulation and competition policy share a common goal: to protect the end oftheeffectslegislationgoverningEuropeanmarket. or competition rules, the recognises cable that industry the European consumer is ultimately at the receiving sound building of importance the of consumer.neutrality,the net around is aware legislation legislation concern protection the data Whether reviewing keenly is industry the that reason very These the Union. are European relationships the in consumers million 67 its with relationships direct has industry cable The Bringing itbacktotheconsumer • • an overarchingpoliticalobjectivetogetprivacyrulesright: cable) thatmainlytargettheconsumerwiththeirbroadbandoffers.Itis,therefore,abusinessobjectiveand as (such businesses to paramount is trust consumers’ growth, in has industry ICT the that role the Given new ones. attracting keeping and by satisfied customers them existing onto holding on based are that models business of lifeblood the is it this: in role large Trusta experience. has user positive a for cater abide they which by rules the and companies both that ensuring for formula a is rules the of centre the at consumer the Placing personal dataareuptodateandfunctioningproperly. rapid change in information technology will also push the need to ensure that rules and legislation governing Yetago. decade a even imaginable been have not would – scale their and – information of exchanges The manner.balanced a in managed are protection data and privacy as such values European fundamental that crucial remains it change, faster even to catalyst a as acts technology where society changing rapidly a In Data protection:trustasfuelfortheigitalAgenda • • • simple sanctionsshouldbeinplacetoprovideremediesforcustomers. sanctions as serve decent deterrents to the abuse of personal data. Wherever rules are broken, clear and companies mustensurethatconsumers’privacyanddataareadequately protected; offers over-the-top and networks TV hybrid IPTV, by Driven supported asameanstosustaininginfrastructurecompetitioneveninanNGAenvironment. supported Further consolidation of regional cable operators into operators with national reach should, in general, be situation inthebroadbandmarket makinghigherspeedlevelsavailableatlowerprices. At the same time, infrastructure competition from cable operators has significantly improved the overall is deterioratingrapidly. significantly in the traditional cable TV business. The formerly-assumed market power of cable operators 15 cmeiie rsue s increasing is pressure competitive , of personaldata and sanctionabuse protection consumer E nsure adequate adequate nsure

Page 57 Policy implications Abbrevia- tions Abbrevia VDSL P2P NGA LTE HFC GPON FTTH FTTC FTTB DSL D 3.0 DOCSIS B2B ADSL Very highspeeddigitalsubscriberline Point topoint Next generationaccessnetworks Long termevolution(4thgenerationmobilenetworks) Hybrid fibrecoaxnetworks Gigabit passiveopticalnetwork Fibre tothehome Fibre tothecabinet Fibre tothebasement/building Digital subscriberline DOCSIS 3.0 specification interface Data overcableservice Business tobusiness Asymmetric digitalsubscriberline tions

Page 59 Abbreviations Page 60 Munich Solon ManagementConsultingGmbH&Co.KG cable operators,telecommunicationandmediacompaniesaswellbanks andprivateequityfunds. from the development and implementation of range corporate strategies Services industry.to M&A media transaction and support. Clients telecommunication include European the for consultancy leading the is Solon Solon ManagementConsulting byDr.The preparationofthisstudywassupported FlorianHottner, AndrásSóstóiandNagy. Team: Project Leader:Dr.Nick Dorothea vonWichert- www.solonstrategy.com Phone: +36188033-00 Hungary Andrássy út2.,1061Budapest Budapest Phone: +442070879000 United Kingdom 12a SavileRow, LondonW1S3PQ London Phone: +4989210388-0 Germany Kardinal-Faulhaber-Strasse 6,80333Munich member atCTAM Europe,themarketing organisationofEuropeancableoperators. largest strategic and the benchmarking Survey,study of Cable European cable. European Finally,Solon Dorothea biannual is a board the behind force driving the is Dorothea investors. their and companies media telcos, operators, cable for advice regulatory as well as development business new and strategy support, M&A includes work project Dorothea von Wichert-Nick is Managing Director at Solon Management Consulting. Her www.solonstrategy.com