OECD Urges Governments to Drive Broadband Growth

A new OECD report urges governments to use competition rather than subsidies to promote the growth of broadband in remote areas. Subsidising national operators to roll out broadband in these areas reduces competition and innovation, and may mean that subscribers get stuck with an expensive, yet poor quality, service.

The OECD report, The Development of Broadband Access in Rural and Remote Areas, claims that the arrival of new start-up companies offering wireless broadband at low prices is causing established telecoms companies to speed up their broadband delivery process and cut prices. Indeed, this has already been seen in the UK to an extent, with BT’s suddenly rapid exchange upgrades and dramatic cuts to broadband subscriptions and local loop unbundling.

The number of broadband subscribers in OECD countries is expected to reach 100 million by Q3 2004, up from 82 million at the end of 2004 and 56 million at the end of 2003. Broadband penetration now extends to 75% of OECD household, with 1 in 4 already enjoying a service.

However, the report details that availability will continue to vary widely for at least the next few years:

  • Over 90% of households in Belgium, Denmark, Japan, Korea, Luxembourg, Spain, Switzerland and the United Kingdom can connect to broadband services. Other countries expected to join this group by the end of 2004 include Finland, France and Germany.
  • Countries with larger geographical areas such as Australia, Canada, and the United States are likely to have DSL coverage of between 80% and 90% over the next few years. In Canada and the US, broadband via cable modem already reaches 85% and 80% of households respectively.
  • A number of countries– such as the Czech Republic, Greece, Hungary, and Ireland – have only recently launched broadband services.

The OECD report

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Fraser Lovatt

Fraser Lovatt has spent the last fifteen years working in publishing, TV and the Internet in various capacities, and believes that they will be seperate platforms for at least a while yet. His main interests at the moment are exploring where Linux is taking home entertainment and how technology is conferring technical skills on more and more people. Fraser Lovatt was born in the same year that 2001: A Space Odyssey was delighting and confusing people in the cinemas, and developed a lifelong love of technology as soon as he realised that things could be taken apart, sometimes put back together again, but mostly left in bits or made into something the original designer hadn't quite planned upon. At school he was definitely in the ZX Spectrum/Magpie/BMX camp, rather than the BBC Micro/Blue Peter/well-behaved group. This is all deeply ironic as he later went on to spend nine years working at the BBC. After a few years of working as a bookseller in Scotland, ("Back when it was actually a skilled profession" he'll tell anyone still listening), he moved to England for reasons he can't quite explain adequately to himself. After a couple of publishing jobs punctuated by sporadic bursts of travelling and photography came the aforementioned nine years at the BBC where he specialised in internet technologies and video. These days his primary interests are Java, Linux, videogames and pies - and if they're not candidates for convergence, then what is?