The history of information and communication technology (ICT) development in low- and middle-income countries shows that private-led, increasingly competitive markets are highly effective at extending new networks and services throughout the population.1 An alternative interpretation is that only those innovations that ultimately pass the market test are sustainable and considered successful. In numerous countries, chronic, acute telephone service shortages gave way to rapid growth once market-oriented sector reforms were adopted. Mobile phones, initially a premium voice service, now provide a platform for a wide range of information and communication services and applications, covering more than 80 percent of the world’s population. The Internet has been growing even faster.

Each new generation of communication services has diffused throughout the population faster than the previous one. Following sector reforms, the number of wireline telephones per capita took over 30 years to multiply tenfold, but it is now in decline worldwide. In contrast, the number of mobile phones took about 12 years to multiply tenfold, and the number of Internet users took only about eight years (Table 4.1).

However, differences in access to and adoption of wireline and mobile telephony have remained; the same is also occurring with broadband. Moreover, the private sector often has insufficient interest in investing in broadband in rural and remote areas, even with government incentives. Where market-oriented sector reform falls short of meeting all development needs, public sector support for the deployment, ownership, and operation of a broadband network may be deemed necessary. This may be particularly true where broadband infrastructure is viewed as an essential public utility in which the public sector, such as the local government, is responsible for deployment (ITU 2003, 45).

Thus in each country, policy makers should determine whether private sector–led broadband development in the context of market-oriented reform will achieve economic and social goals or whether more direct, targeted government intervention is necessary. Such an approach is reflected in the European Commission’s 2010 Communication on Broadband, which recognizes that, due to the critical role of broadband Internet access, broadband’s overall benefits to society appear to be much greater than the private incentives to invest in high-speed networks (European Commission 2010). As a result, stimulating investment beyond the current market-driven levels (while taking into account the recent economic downturn) is seen as key to achieving broadband goals. However, the communication also specifically recognizes that, where intervention is deemed necessary, it is important to limit the government’s role as much as possible so as not to distort well-functioning market mechanisms or discourage private investment.

4.2.1 Levels of Access

Countries have adopted various strategies to enable and facilitate universal access to broadband services. Some countries, particularly developed countries with extensive existing wireline penetration, have focused their broadband strategies on providing access to individual users, while other countries with less well-developed network infrastructure have looked more toward providing access to communities and key institutions.

4.2.1.1 Individual Users and Households

Many countries, some of which are discussed in this chapter, have focused on providing broadband access for individual users and households, including through the extension of universal service definitions and universal service obligations (USOs). In certain instances, these are developed countries that implemented policies to facilitate the deployment of extensive infrastructure and ease the path to high broadband penetration. Therefore, it is more feasible for them to achieve universal broadband by focusing on individual users and households. Finland, for example, was the first country in Europe to include broadband Internet access in its definition of “universal service” and to make broadband a legal right for every citizen.2 Finland, Ministry of Transport and Communications (2009); “Finland Makes Broadband a Legal Right,” BBC News, July 1, 2010, http://www.bbc.co.uk/news/10461048. Based on an amendment to the Finnish Communications Market Act,3 Amendment 331/2009, as integrated into section 60c of the consolidated Finnish Communications Market Act, http://www.finlex.fi/en/laki/kaannokset/2003/en20030393.pdf. begin_of_the_skype_highlighting FICORA, the Finnish regulator, designated 26 telecommunications operators as universal service providers. This designation requires such operators to provide, within their operating area, broadband connectivity for consumers and business customers at their permanent place of residence or business, with guaranteed connection speeds of at least 1 megabit per second (Mbit/s).4 FICORA, “1 Mbit/s Broadband for Everyone on 1 July 2010: Telecom Operators’ New Universal Service Obligations Enter into Force,” June 29, 2010, http://www.ficora.fi/en/index/viestintavirasto/lehdistotiedotteet/2010/P_27.html. Similarly, the Icelandic government required the country’s incumbent operator to guarantee broadband access to the 1,800 remaining unserved consumers in order to achieve universal broadband access (BEREC 2010).

In Denmark, Canada, and Ireland, governments have focused on expanding universal access to households. In June 2010 Denmark announced an ambitious broadband goal of providing access of at least 100 Mbit/s to all households and businesses by 2020 (Denmark, National IT and Telecom Agency 2010). To achieve this goal, the Danish government stated that it would continue to pursue its market-based and technology-neutral approach, focusing on the deployment of broadband infrastructure in Denmark. Measures to promote broadband have included promoting competition in the access network and rolling out wireless broadband to cover hard-to-reach areas (Petersen n.d.). By the middle of 2009, out of 2.8 million households, fewer than 9,000 did not have access to a broadband connection, and by the end of 2010 all households had access to a broadband connection of at least a 512 kilobits per second (kbit/s).

Canada’s 2009 Economic Action Plan provided Industry Canada with Can $225 million over three years to extend broadband coverage, with the biggest component of this strategy being the Broadband Canada: Connecting Rural Canadians Program. The program sought to extend broadband service to as many unserved and underserved Canadian households as possible, recognizing that, since communities vary greatly in size, the fact that a community has broadband access does not always mean that service is available to individual households.5 Government of Canada, “Canada’s 2009 Economic Action Plan,” http://www.actionplan.gc.ca/eng/index.asp.

Ireland has attempted to ensure nationwide provision of broadband through its National Broadband Scheme (NBS).6 Ireland, Department of Communications, Energy, and Natural Resources, “National Broadband Scheme,” http://www.dcenr.gov.ie/Communications/Communications+Development/National+Broadband+Scheme.htm. The NBS was a government project funded under the National Development Plan to provide broadband coverage to areas in Ireland in which broadband services were deemed to be insufficient. Under the scheme, users’ connections must be “always on” and capable of 1 Mbit/s downloads and 128 kbit/s uploads. The lowest possible cap on downloads was defined as 10 gigabytes (GB) per month, and the connections had to support virtual private networks and voice over Internet Protocol (VoIP) applications.

4.2.1.2 Communal and Institutional Access

Providing universal access at the individual user and household levels may not always be possible, particularly in developing countries or even in developed countries with significant rural or hard-to-reach areas. As a result, some countries have opted to give greater attention to communal or institutional solutions for providing broadband to end users, especially service to unserved or underserved areas. These projects are often funded, at least in part, by resources from universal service funds (USFs). While traditionally these funds were used primarily or exclusively to support the deployment of telephony services, they have been expanded to support broadband deployment. In certain instances, these USFs are aimed at facilitating the supply of broadband services and are often coupled with initiatives focused on generating demand for such services.

For example, in India the Universal Service Obligation Fund (USOF) is used to support communal access by providing wireline broadband connectivity to rural and remote areas of the country from the existing rural wireline exchanges of Bharat Sanchar Nigam Limited (BSNL).7 “Universal Service Obligation Fund Supported Scheme for Wire Line Broadband Connectivity in Rural and Remote Areas,” http://ittripura.nic.in/USOF_broadband_scheme.pdf. BSNL provides one kiosk connected to each designated rural exchange, and the connectivity is subsidized by the USOF. The kiosk maintains a workstation with facilities to provide Internet browsing and support other broadband applications such as video chat, video conferencing, telemedicine, and online learning.

Similarly, in Jamaica the Universal Access Fund (UAF) Company was established in 2005 to accelerate the deployment of broadband through public access in high schools, public libraries, post offices, and other government agencies or institutions. In April 2011 the UAF Company funded a J$543 million (US$6.37 million) project with telecommunications companies LIME (Cable and Wireless) and FLOW (Columbus Communications) to build out a high-speed, islandwide broadband network, again focusing on all secondary schools, post offices, and public libraries in Jamaica.8 “Deal Reached to Build Broadband Network across Jamaica,” Caribbean 360, April 7, 2011, http://www.caribbean360.com/index.php/business/329864.html#ixzz1PFlD7XJNhttp://www.caribbean360.com/index.php/business/329864.html#ixzz1PFke9Ck7.

Some countries take a hybrid approach by establishing a general universal access plan focused on connecting individuals or households while also targeting access at the community level. For example, the U.S. National Broadband Plan (NBP) generally seeks to ensure affordable access to at least 100 million U.S. households with 100 Mbit/s or more download speed and 50 Mbit/s or more upload speed by 2020 (United States, FCC 2010). The NBP additionally seeks to ensure that every U.S. community has affordable broadband Internet access at speeds of at least 1 gigabits per second (Gbit/s), highlighting the importance of having institutions (such as schools, libraries, and health clinics) both serve as anchors for these local communities and deliver digital literacy, job training, continuing education, and entrepreneurship programs with support from government funds.

4.2.2 Universal Broadband Targets within the Broadband Strategy

Achieving universal broadband access is a challenge for all countries. In the case of developing economies, broadband is also seen as a key component of fostering growth and supporting the provision of a range of services to rural regions. To this end, countries are defining more comprehensive universal access and service (UAS) strategies and aiming to set universal broadband targets in the context of the country’s UAS and overall development strategies. As detailed in Box 4.1, the Dominican Republic’s e-Dominicana Strategy focuses on the long-term promotion of universal access to ICTs, with the objective of ensuring that the country’s population develops the necessary skills to use ICTs through the creation of conditions, such as the availability of ICT resources and infrastructure at a reasonable distance from the place of residence and at affordable price levels. The strategy also puts particular emphasis on the link between the development of ICTs, long-term economic growth, and the development of human capital (ITU 2008). In the United States the NBP advocates an expanded funding commitment to the Community Connect Program, which provides free Internet access to residents with the goal of facilitating economic development and enhancing educational and health care opportunities in rural communities. The European Commission, in line with the European Union’s common interests of territorial, social, and economic cohesion, has indicated its support for state financial resources to assist in providing broadband services to those areas currently un-served and where private investors do not have plans to deploy broadband networks in the near future (European Commission 2009).

As these examples show, it is becoming increasingly important for UAS policies and broadband policies to influence each other.9 InfoDev and ICT, “ICT Regulation Toolkit, Module 4, Universal Access and Service,” sec. 4.1.3, Relationship to Broadband Policy, http://www.ictregulationtoolkit.org/en/Section.3258.html. UAS policies can promote the spread of broadband services and stimulate demand. Broadband policies can use a range of regulatory and fiscal options to reduce costs (for example, international gateway liberalization) and facilitate broadband network investment, which, in turn, leads to better access at lower prices.

Although several countries have separate broadband and UAS policies (India, Jordan, Malaysia, Pakistan, and South Africa), the boundaries between UAS and broadband policy are not as clear in other countries. Recent trends, however, show that policy makers are increasingly merging the two topics to accommodate universal broadband challenges. UAS and universal broadband availability have become fundamentally linked in nearly all countries’ universal access strategies, except in least developed countries (Dymond 2010). As shown in Box 4.2, Chile has a new Information Society Universal Access Policy. The new policy brings together Chile’s broadband policy and the Universal Access and Service Fund (UASF) and seeks to enable rural communities with productive potential to participate more effectively in the economy through innovation and increased competitiveness.

A universal broadband policy should be a central part of the ICT framework and not construed as simply a result of corporate social responsibility or acts of “goodwill” by investors in the ICT sector. Policies and measures should be formulated carefully, and universal broadband policies should be given a proper space in the national policy and legislative frameworks for development as well as in the institutional framework for telecommunications regulation. Thus it is important not only to set universal broadband targets in the context of the country’s UAS policy, but also to take account of the country’s overall development strategy. Universal broadband targets should be developed based on the country’s short- and long-term goals for economic growth and broadband deployment. Development policies (for example, e-education) should also consider telecommunications-specific regulations and policy goals, such as competitive parity between players (Atkinson, Correa, and Hedlund 2008, 19).

As illustrated in a World Bank study on the Republic of Korea, a key factor in achieving widespread broadband access was the country’s holistic approach to defining and implementing numerous policy developments and initiatives, including policies to promote universal access to broadband. The Korean government has sought to promote ICTs, particularly broadband networks and services, by implementing a series of “master plans” that extend over several years and provide strategic, long-term development frameworks. Each framework has set out overarching policy objectives, as well as the supporting policies to achieve these goals. Among the key elements taken into consideration were the policies promoting universal access to broadband (Kim, Kelly, and Raja 2010, 20–21).