FTTH Council determined to get funding flowing to regional fibre projects

By Sooraj Shah
22 Jan 2013 View Comments

The idea that broadband projects face a struggle to find finance is a myth, according to the director general of non-profit organisation FTTH Council Europe, Hartwig Tauber.

"Because of the financial crisis, people say there is no money for fibre broadband, but it has been the other way around. Those institutional investors who are looking for long-term secure investments are also starting to look into fibre as a long-term proposal," he said.

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However, Tauber conceded that there is a mismatch between projects and investors.

"Investors are looking for big projects worth €200m to €400m, and the kind of projects in Europe we're seeing are worth around €30m, €40m or €50m, which are small in comparison," Tauber said.

He said the bigger investors tend not to be aware of smaller projects like Broadband 4 Rural North (B4RN), a community effort to provide fibre to homes in the Lune Valley and Trough of Bowland in Lancashire. Meanwhile, those leader such community projects are unsure of how to approach these bigger investors. Tauber said that this is a problem that the FTTH Council is attempting to rectify.

"We believe if we make the right match it could work out, and if this becomes a trend then the whole issue of deploying fibre could be taken away from the incumbents, leading to a dynamic market on the regional side of things," he stated.

Tauber explained that in Germany, this type of relationship had already brought results, with a regional investment bank supporting several smaller fibre projects.

The UK

While BT claims it has no other choice but to reuse copper lines, as it makes financial sense,  Tauber believes that the UK should have followed Sweden's lead and turned to fibre earlier.

"Sweden had a good copper network as well but they turned early (in 2001) to fibre. If you sum up all the networks, it would have been cheaper to go for a full fibre network immediately, that's why now the incumbents have to make smaller investments," he said.

He said BT's ambition is being held back by short-term commercial targets and a need to keep shareholders happy.

"It's not the long-term vision of the company for [the key executives], but how can I quickly increase revenues and shares to make sure that the shareholders are happy," he said.

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