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Broadband boon for society

Many governments realize how critical universal broadband access has become to the economic health of their nations. Few, however, understand which technology works best - or where.

July 7, 2006

It turns out that governments can often get the best and most objective broadband technology advice from the industry players themselves.

Peter Dahlström is project leader for Länssamverkan Bredband, a Swedish organization charged with awarding public broadband subsidies to local jurisdictions. "We are not engineers or technicians," he says. "When a new technology is launched, it's very difficult for us to position ourselves.

"Right now, we're uncertain what capacity radio solutions have in rural areas," Dahlström says. "With 10 to 15 percent of homes and businesses in Sweden beyond the reach of fiber, is radio the solution? Hearing from Ericsson was very valuable. They gave us a new dimension that we're including in our final report."

As a vendor of broadband networks, Ericsson can benefit financially from developing strong relationships with regulatory agencies. But that is not the only thing that prompted Hans Höglund, strategic marketing manager for Ericsson's Business Unit Broadband Networks, to provide information to Dahlström's group.

In May, Höglund and Andrei Dulski, marketing manager at Ericsson's Business Unit Access, arranged for a presentation to Länssamverkan Bredband, discussing new broadband technologies that are entering the market today and explaining how they can serve the public in an efficient way.

Holistic approach
"They had already had presentations from other parties that came to explain their particular technology," Höglund says. "I told them we wanted to take a more holistic approach. We took more of a consultancy role to try to make sure that they understood their various options."

The so-called digital divide - the gap between broadband haves and have nots - remains a challenge in Scandinavia and beyond. Rural areas have difficulty attracting the high-speed connections they need to participate in the new economy.

The main obstacle is cost. Operators can not make enough money in areas with few customers to justify broadband investments. That leaves it up to government to finish the job, usually through public subsidies to operators.

In Sweden, the total public subsidy from the national government has totaled about SEK 5 billion (approximately USD 685 million) over the past six years.

Some local jurisdictions in remote areas embraced the project enthusiastically - only to realize after a few years that their goal of bringing fiber to every home was not economically feasible, even with generous government subsidies.

So Dahlström's group is investigating less expensive radio alternatives. High on the list are wireless broadband technologies such as HSPA (High Speed Packet Access) and WiMax (Worldwide Interoperability for Microwave Access). 

Ericsson's HSPA solution may eventually be chosen in some areas because it can be deployed for a fraction of the cost of laying fiber in the ground, Höglund says.

"We don't know for sure that we will be the ones supplying it, but we know it would be good for society," he says. "We know the solution will be very cost-efficient, and Ericsson will be out there competing with everybody else."

Dahlström adds, "The timing of Ericsson's presentation was just right."