The Ministry has published the results of a survey on the need for broadband aid
On 13 March 2024, the Ministry of Transport and Communications published the results of a survey on the future need for broadband aid. The survey assesses previous broadband aid schemes, the current state of the markets and any need for a new aid scheme.
In Finland, the construction of communications networks is market-based, with the exception of the most sparsely populated areas. The survey indicates that a new aid scheme could promote digitalisation, improve regional equality and boost the vitality of municipalities.
In addition to the aid scheme, broadband construction receives support from the European Agricultural Fund for Rural Development (EAFRD). As stated in the Government Programme, the Government will assess the need to continue the broadband aid scheme for the construction of fixed broadband connections in areas where they would not be constructed on a market basis.
“Good connections across Finland are a prerequisite for smooth and safe daily activities. We will pay serious attention to this survey and seek solutions for strengthening communications networks in non-built-up areas. We will next discuss the survey in the ministerial working group on social transformation,” says Minister of Transport and Communications Lulu Ranne.
The target of Finland’s Digital Compass is that all Finnish households and businesses have access to 1-gigabit telecommunications connections and the 5G network covers the entire population in 2030. This target reflects the EU’s goal of offering gigabit network connections to everyone and ensuring wireless high-speed network coverage at least equivalent to 5G of all populated areas by 2030.
Funding is also available from the European Agricultural Fund for Rural Development
The Ministry of Transport and Communications has been implementing aid schemes to promote high-speed broadband connections since 2010. The most recent scheme ran until the end of 2023.
Broadband construction also receives support from the EAFRD through an aid scheme administered by the Ministry of Agriculture and Forestry. In village network projects, municipalities are not required to contribute to funding, and projects have been carried out based on voluntary work.
In Finland’s CAP Strategic Plan 2023–2027, EUR 53 million of funding has been allocated to broadband connections in rural areas. In 2014–2022, the EAFRD provided funding of approximately EUR 73.3 million to a total of 179 projects.
Finland’s communications networks are largely constructed on a market basis, but a boost is required in sparsely populated areas
In Finland, the construction of communications networks is mainly market-based. Mobile network coverage has developed well, and in late 2023, high-speed 5G networks covered 90% of Finnish households and 14% of the land area.
However, in international comparisons, Finland trails the other Nordic countries in high-speed connections, and especially in access to fibre optic connections. At the end of 2023, fibre optic networks were available to 61% of Finnish households, compared to 96% of households in Sweden at the end of 2022. Finland has also fallen behind the Baltic countries in this respect.
In cities and built-up areas with detached housing, the construction of fibre optic networks has picked up, as active new operators have entered the market and the range of networks has expanded. In the most sparsely populated areas, networks are unlikely to be constructed on a market basis, and further measures are required for their construction.
According to the post-assessment, prior aid schemes were successful
The survey indicates that adopting a high-speed broadband network, increasing its speed and expanding its availability has increased Finland’s GDP. High-speed data connections are important for both citizens and businesses, and their importance is expected to increase moving forward.
Good data connections are already considered part of the necessary basic infrastructure. With more and more services moving online, it is essential that data connections work smoothly also in rural areas.
The survey presents a post-assessment of previous broadband aid schemes conducted by Sitowise Oy. According to the assessment, broadband aid schemes had a significant impact on the construction of fibre optic networks in sparsely populated areas. Fibre optic construction has boosted competition in these areas and improved the areas’ mobile networks. It has also attracted new companies to the market.
The aid schemes were not found to have interfered with market-based construction. The aid has been successfully targeted at areas in which networks would not have been constructed otherwise.
What’s next?
As stated in the Government Programme, the Government will assess the need to continue the broadband aid scheme for the construction of fixed broadband connections in areas where they would not be constructed on a market basis. According to plans, the matter will be discussed in the working group for social transformation, chaired by Minister of Transport and Communications Lulu Ranta, on 15 March 2024.
Inquiries:
Sofia Lindbäck, Senior Specialist, tel. +358 295 342 165, [email protected]
Lauri Mustonen, Senior Specialist, tel. +358 295 342 252, [email protected]
