Remarks by the Auditor General Mr. Alar Karis about the audit report "Effectiveness of the development of a broadband network or high-speed Internet"

Alar Karis | 3/12/2015 | 12:00 AM

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"People who have no water at home because the supply network does not reach their house find no consolation in the fact that a hundred metres from their home there is a nice big pipe supplying others with water that meets all European quality requirements. As people often cannot afford to build utility lines, those not connected to the water supply system have to get their water from a well in the yard, which sometimes dries out and where the quality of water fluctuates.
At present, we are in a somewhat similar situation with the national plan, which is very much necessary and right for Estonia and aimed at guaranteeing almost every home with access to superfast Internet. The plan, which has already received 28 million euros in support from the state and which stands to receive another 41 million euros, was based on the assumption that the state would finance the construction of the basic network, and communications companies would then use it to build connections that take fast or superfast Internet to consumers, i.e. invest in cables and equipment or install the equipment required for the provision of fast Internet to mobile masts. The basic broadband network established with European Union support was planned in such a manner that it would be no further than 1.5 kilometres from 98% of homes.
However, communications companies have no clear economic interest in establishing connections from the broadband network to end consumers in sparsely populated areas where the number of consumers is small or building a modern access network based on fibre optic cables in areas of private homes in larger towns and cities. This is where the state should try to find a suitable solution to the market failure with an emphasis on the needs of people in the regions of Estonia whose stability and development should be given more attention. This would mean that the absence of a proper Internet connection would cease to be a reason why jobs that require a fast Internet connection cannot be created in certain places or why people leave their present places of residence.
Of course, the problem must be approached from the viewpoint of common sense and reasonable expenditure: it is understandable that taking superfast Internet to every corner of the country would not be optimal, but different technological solutions should be combined instead – online connections via cable, mobile Internet etc.
To date, communications companies that develop mobile Internet have benefited the most from the development of the basic broadband network, but the benefits for end consumers have also been significant – companies are now able to offer 4G Internet to people, which is not always an equivalent replacement for a cable connection, but is still a pretty good solution to many concerns.
At present, less than half of the planned 6600-kilometre basic network has been completed. Therefore it is high time for the government to cooperate with communications companies and consumers to create a plan to guarantee a high-quality fast and superfast Internet connection for a reasonable price to all homes and organisations by at least 2020. Let me remind you that the initial deadline was 2015."

  • Posted: 3/12/2015 12:00 AM
  • Last Update: 9/8/2015 12:19 PM
  • Last Review: 9/8/2015 12:19 PM

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