BROADBAND POLICIES
FOCUS ON THE ITALIAN GOVERNMENT
ACTION PLAN
Daniela Battisti
Member of the Executive Committee for Broadband Action Plan
Ministry for Innovation and Technology (Italy)
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Agenda
- Do we Need/Have a Broadband Definition?
- e-Europe2005 and the Sevilla Summit
- The Italian BB Action Plan
- Focus on Public Demand
2
TO BEGIN WITH…
One day, the elephant said to
the bird: “I wish I had wings”
–
And the bird: “No problem.
Just get them!”
The elephant asked again:
“But, how do I get them?”
“I do not know! I just do
policies.” The bird
exclaimed.
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DO WE NEED/HAVE A BROADBAND DEFINITION ?
Broadband communications refers to the
technological enviroment that permits the use of
digital technologies at maximum levels of interactivity
(Source: Italian Broadband Report, Feb 2002)
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SHALL GOVERNMENT ENACT POLICIES TO
PROMOTE BROADBAND ?
 E-EUROPE 2005 ACTION PLAN (SEVILLA 21 JUNE 2002)
 ALMOST ALL EUROPEAN GOVERNMENTS ARE
ADOPTING POLICIES TO PROMOTE BB BUT FEW HAVE
AN ACTION PLAN
 THE ITALIAN BB ACTION PLAN (PHASE 1,2, 3)
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BB APPROACH IN ITALY
Accordingly, the development of broadband in Italy
is considered an economic policy objective priority.
In such an environment, the Government must
intervene to ensure that the development of
broadband is as homogeneous and rapid as
possible nationwide.
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The Principles for Action (Italy)
• Government has included the Broadband Plan in the
Economic and Financial Planning Document for the period
2002-2006.
• Plan will: 1) assess, 2) identify the key importance of
broadband, 3) formulate measures 4) ensure implementation
• Interministerial Broadband Task Force, (1st phase
executed), has reaffirmed that BB is a prerequisite for the
economic development of the country.
• Objective of 2nd (current phase) is to formulate a plan.
• 3rd phase will consist of the implementation of the plan
itself.
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3 Main Macro-phases
1
Macrophase
Owner
Time
horizon
Deliverables
2
Vision
3
Planning
Broadband Task Force
Implementation
Executive Committee for
the definition of a
Broadband Plan for Italy
(to be defined))
...
September
2001
Broadband Report
June
2002
March
2002
Broadband Plan
...
Medium-term operational
projects and rapid actions
(pilot projects)
Final phase
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What Actions can ensure BB Development
by 2005
Current situation
(planned)
Additional actions
INFRASTRUCTURE
INFRASTRUCTURE
PLANNING OF ACTIVITIES
PUBLIC SECTOR
DEMAND
PUBLIC SECTOR
DEMAND
MECHANSISMS FOR
IMPLEMENTATION
PRIVATE SECTOR
DEMAND
PRIVATE SECTOR
DEMAND
MECHANISMS FOR CONTROL
Snapshot of situation
hitherto
Objectives
Levels of
interactivity &
evolution over
time
Evaluation of the
impact on
productivity and
the national
income
The objective of the plan is the development of the
market within the established time frame (2005)
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The achievement of objectives requires public
intervention to enhance infrastructure and
generate public and private demand
Scopo
degli objectives
interventi
Coverage
• 85-90% of government buildings
• 65% of businesses
• 35% of households
Lines of intervention
A
B
Infrastructure
Private Demand
C
Public Demand
Purpose
of interventions
Purpose
of action
• generate incremental investment by private-sector operators over
and above that invisaged in current declared business plans
• generate an incremental market which will create a substantial
and permanent increase in tax revenues
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A
Infrastructure
The special nature of the Italian infrastructure
situation makes enabling and stimulus action
essential
• Lack of alternatives to copper-based connections for access networks and, particularly,
the absence of cable modems
• Copper-based network delivers better performance than the European average (better
quality, lower average distances in the local loop)
technological • Development of fibre optics could be fostered using existing conduits owned by the
Special nature
of Italian
infrastructure
incumbent
• The building of extensive enabling infrastructure for the development of WiFi
• The development of experimental telecommunication services that are delivered
through the electricity grid
competitive
• A sufficient level of competition has not been reached in the market,
Enabling and preliminary actions
Necessary
actions
Regulatory measures
Administrative simplification
Stimulus activities
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B
Private Demand
Actions to boost private demand are aimed at both
consumers and businesses producing content,
services and applications
• Public support for the production of content, services and applications
Objectives
• Support the expansion of demand for services with a high degree of
interactivity
Supply-side fiscal
measures
Actions
• Incentives to content,
service and application
producers using measures
similar to those introduced
by the “Tremonti bis” law
Demand-side fiscal
measures
• Fiscal incentives to
consumers in the form of
tax endowments
Funding
• Use of Community
financing (participation in
eEurope projects)
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C
Public Demand
Public demand is essential for the development of
Broadband
• Public demand:
Role
- Brings about an expansion in direct demand from government offices as well as indirect
demand from the users of the applications
- Demonstrates the utility of new technologies and improves the likelihood of them being taken up
- Creates a critical mass, including in those areas where the market is least developed, which
fosters the supply of connectivity, services and applications, and reduces prices
• The potential of public demand can be tapped by using demand aggregation methods
• Public demand should be able to make use of structural funds and other available sources of European
financing (Ten Telecom, IDA, IST, etc.)
Actions
• The objective is to take some of the funds set aside for the development of the information society and
channel them into projects that will bring broadband to the most disadvantaged areas
• The Department for Innovation and Technologies must act as a coordinating body to avoid duplication,,
encourage cooperation, capitalise on the intersectoral features of the projects of other government
departments and maximise synergies.
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C
Public Demand
To act as a stimulus, public-sector demand must
expand from current broadband coverage of 20%
to more than 80% by 2005
Current situation
Number of buildings
Objectives
Narrowband
Broadband
Narrowband
Broadband
Central govt 1
10,000
6,300 (63%)
3,700 (37%)
500 (5%)
9,500 (95%)
Local govt 2
13,000
7,900 (61%)
4,300 (33%)
1,000 (8%)
12,000 (92%)
Schools3
42,000
34,500 (82%)
7,500 (18%)
6,500 (15%)
35,500 (85%)
20,000
18,600 (93%)
1,400 (7%)
3,000 (15%)
17,000 (85%)
85,000
67,300 (79%)
16,900 (20%)
11,000 (13%)
74,000 (87%)
NHS buildings4
Total
1) Source: CT RUPA and individual departments
2) Source : individual regions
3) Inclusive of central and local governments. Source: Ministry of Universities, Education & Research (targets set on basis of eEurope 2005
plan)
4) Source: Ministry of Health (targets set with reference to strategic goals of National Health Plan and eEurope 2005)
Figures compiled by Roland Berger Strategy Consultants
Increase by 2005 of broadband coverage of government from current level of 20% to
’87%, with at least 15% of connections at speeds over 2 Mbit/s
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The actions will have an impact around the
country, especially in areas with the lowest
Preliminary
development potential
Distribution and impact of actions
A Areas with high
development potential
B Areas with medium
development potential
C Areas with low
development potential
Public-sector demand
Tax relief (Tremonti bis)
Infrastructure contributions
-
Subsidised infrastructure loans
State contributions to structural funds
-
Incentives for private demand
Low
High
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The Government will provide €1,200 million in
funds for public demand and €600 million for
infrastructure building and private demand
Cost of Incentive Plan*
200
• Economies achieved by
demand aggregation
Incremental spending 2003-2005 (millions €)
State budget Local gov budget
1,200
Public
demand
1000
• Public demand entails
total costs of €1,000 –
1,200 million, with
reference to the savings
achieved through
demand aggregation
Central govt
Local govt
Schools
Infrastructure
550
Hospitals
Total
Private
demand
150
100
• Total investment €100 million (minimum value)
500
• Total investment of €500 million to
leverage private resources worth
€2,500 million
700
Total
150
150
150
100
650
250
250
500
1,000 – 1,200
* The resources activated make it possible eventually to achieve tax revenues sufficient to ensure full coverage of the costs incurred
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Public sector demand / and broadband
Public sector demand is one of the main levers for the development of the BB market, calling
for models of demand aggregation
Public sector
demand
ALL ACTIVITIES
1.
Mapping public sector demand for connectivity (Unified Government Network (RUPA)-Regional
networks- e-government in local authorities), and digital services, and mapping the related
implementation plans (drafted by the Department for Innovation and Technologies, other
branches of central government, the regions and e-government in local authorities)
2.
Processing of information received and identification of current and projected public sector
demand in terms of advanced interactivity
3.
Selecting models for actions (demand aggregation)
4.
Incidence of public sector demand on the economic situation of operators (business plan) and
the planning of actions
ACTIVITIES UNDERTAKEN TO DATE
Mapping central and local
government departments
Demand aggregation
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Regions/Local Government were Requested to
Provide Detailed Information
MAPPING SPACE
INFORMATION
REQUESTED
• Regions
• Provinces
• Municipalities
• Schools
• Logistics of
offices
• Connectivity
• Digital services
• Hospitals
8,100 municipalities have been addressed + all the Regions
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Mapping Public Administration is a Key Step…
Mapping of Unified Government Network (RUPA)
Main peripheral offices of ministries, local noneconomic government bodies and other
agencies
Geographically referenced database
All offices of ministries, local non-economic
government bodies and other agencies
INFORMATION REQUIRED
• Logistics of
offices
• Connectivity
• Digital services
Ministries
• Ministry of Education,
Universities and Research
• Ministry of Justice
• Ministry of Health
• Ministry for the Economy
Direct involvement in
Public Demand
Committee
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… While Contributing to the Acceleration of BB
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Impact on the market for broadband services
of combining public with private-sector demand
4
Possibility of defining minimum bandwidth
standards for the entire public administration
Benefits of
aggregating public
sector demand for
broadband services
3
Greater penetration of broadband in the
public sector at low operating costs
2
Increase in demand for
broadband fromwithin the public sector
1
Greater efficiency in government procurement
and consequent economies of scale
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This ‘telephone’ has too many shortcomings to be seriously
considered as a means of communications. The device is
inherently of no value to us
-- Western Union 1876
Broadband:
In the absence of substantial demand
does it matter?
We believe it does
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