French High-Speed Internet to Get Big Boost

Feb 26, 2013

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The French government recently announced a new initiative designed to give the country’s high-speed Internet a boost while the same time creating jobs and stimulating French economy. French president François Hollande intends to spend €17 billion over the next 10 years to connect every French household to super-fast broadband. Although Hollande's idea is seen as a new initiative, it really is just a larger version of a plan floated by previous president Nicolas Sarkozy. Ambition Numerique (Digital Ambition) is nearly 4 times the size of Sarkozy's earlier $4.5 billion plan and quite a bit more ambitious when you consider how rural some parts of France are. Some observers believe the large area of French countryside as compared to her major cities is the thing that has prevented such development in the past. They say that is also why the price tag for Hollande's initiative is so high. Building the infrastructure and running the fibre out to the countryside is nothing if not extremely daunting. According to Hollande and others, the need for nationwide connection to super-fast fibre is absolutely necessary if the nation's businesses are to compete with the rest of Europe. Given the pace at which cloud computing and demand-based networking is growing throughout Europe, such an argument is easy to make. The biggest question surrounding the plan is the funding. To finance the initiative Hollande plans three sources of revenue. One third will be funded by private industry sources, one third through private/public partnerships, and the final third from the state and local governments. Most of the private and community money will be focused on major cities while the state money will be spent on rural communities. The initiative has been structured this way specifically because of an unwillingness among private companies to invest in rural areas. That is the same reason why Sarkozy's plan never got off the ground.

Investing to Keep Up

The current state of IT services and fibre networking in Europe dictates that France really does not have a choice; they must invest to keep up. And due to the geographic and economic make-up of the country, it seems they would be unable to keep up without government participation. In the UK, things are a bit different… The fewer rural areas here means the private sector is much more willing to invest in fibre networks because there is money to be made. That is one of the reasons why the UK IT sector is the strongest in Europe. The continued development of super-fast broadband is certainly helping business and injecting some much-needed life into the UK economy. We hope, for the sake of the French economy, that Hollande's plan does indeed work. Nevertheless, in a country where drastic austerity measures have been needed to prevent a complete financial collapse, the question of whether or not the government will be able to meet its financial goals with Ambition Numerique will be a lingering one for the next 10 years. If they start and are unable to finish, things could end up being worse.