The German Government has decided to expand the funding of broadband roll out by adding another €1.3 billion, announced the country’s Transport and Digital Infrastructure Ministry. This will take the total investment in this sector to €4 billion. The new investment will be used for network expansion in “specifically underserved regions”, where it would be otherwise difficult to deploy the coverage.
In October 2015, Government already allocated €2.7 billion for the purpose stating that the country will deploy high-speed internet throughout the country by 2018. Precisely, Government vowed to provide all households downlink speeds of at least 50 Mbit/s by 2018. A share of this sum, around €1.3 billion, was collated from the revenue generated by the auction of mobile spectrum. Another €1.4 billion was taken from the state budget.
Commenting on this budget expansion, Alexander Dobrindt, minister for transport and digital infrastructure said, “We are investing in the development of the gigabit society. For this, we need superfast Internet for all, throughout Germany.”
Germany follows different funding models to make this possible. To say, the municipalities in the country can apply for funding and once allocated, it can be used to build their own infrastructure. They would then lease it to operators. Another way is to use the funding to plug the profitability gap of a private operator.
For any projects, Government awards a grant, which would cover the 50% of the project. In rural areas, this would be 70% of the project. For a project, the maximum grant is €15 million. But, it is possible to combine state funding with the support programs of the federal states.
Better internet access is necessary for the country’s Digital Agenda, which targets primarily on the digitization of industries by connecting the factory floors to the internet. Germany has many of its small-and-medium-sized companies located in the rural regions.