Ultra-fast internet: Demand and supply dimension of broadband policy in the EU

Doctoral thesis, 2015

With the fast pace of technology development in the telecommunications sector, the benefits of fast and ultra-fast internet have been recognised by public sector, private sector and academia in the recent years. The European Union (EU) has acknowledged the importance of fast and ultra-fast internet by including fast and ultra-fast internet as a part of the EU Digital Agenda. To achieve the targets on fast and ultra-fast internet, a number of broadband policies need to be implemented for both broadband access and broadband adoption. Broadband policy which relates to broadband infrastructure or broadband access is called supply side policy while the policy which deals with broadband adoption and the content and applications can be seen as demand side policy. This thesis has two main purposes. First, it aims to recommend possible broadband policies for the EU to achieve its targets on high speed broadband access (supply side) and broadband adoption (demand side). The second purpose is to suggest the benefits of high speed broadband to the economy. Four appended papers have been conducted to address the first aim while one appended paper has been done to support the second aim. Finally, the cover paper is written to connect all five appended papers and illustrate the whole idea of the topic. This compilation thesis is a cross-disciplinary research based on the disciplines of applied economics, policy as well as social science. Econometrics estimation is the main approach used in three of the five appended papers while economic frameworks and concepts are the basis of the document analysis conducted in the remaining two papers. The findings of this thesis have shown that, in relation to the first aim, both supply and demand sides of broadband policy are important. They are interrelated and reinforce each other. Thus, policy makers should encourage not only supply side but also demand side of broadband policy because these policies complement rather than substitute each other. In addition, there are 28 member states in the EU which differ in terms of broadband coverage and adoption. One broadband policy tool may fit with one member state but not the others. In addition, the focus of using supply and demand side policy can vary depending on the stage of broadband development. On the findings relating to the second aim, the study has found that there are significant positive impacts of transmission speed on the economy. The findings from the second aim also imply the importance of broadband policy which ultimately affects the economic outputs.