It should be a very big issue for this federal government. In the coalition agreement, the traffic light promised: “We want something new.” And: “Our goal is the nationwide coverage of fiber optics and the latest mobile communications standard.” The message was clear: the new government made up of SPD, Greens and FDP wants to finally accelerate Germany’s digitization. In particular, the fiber optic expansion and thus faster and more secure Internet connection should soon lead to almost every corner of the country.
The fiber optic network is considered the pillar of Internet acceleration. It offers particularly powerful and fast connection. So far, however, the connections are more of a rarity than a rule. At the beginning of the year, according to the Federal Network Agency, the proportion was only about one fifth of households. The responsible Digital and Transport Minister Volker Wissing (FDP) has therefore made a lot of plans. Wissing announced that half of all households should have a connection by 2025.
But four months after taking office, there are increasing doubts in the federal states and municipalities as to whether Wissing will be able to turn the tide. In mid-March he had presented the key points for his so-called “gigabit strategy”. It is intended to accelerate the expansion of fast Internet and mobile communications. But even the paper that is supposed to be the basis of his strategy has met with resistance. A first federal state urgently warns that Wissing’s planned conversion of fiber optics production could not accelerate the expansion, but bring it to a standstill.
So far, the state has subsidized where the economy is not active
There is great excitement in the state government of Baden-Württemberg. “The federal government’s considerations of massively reducing and extending funding is a serious mistake – yes, it’s actually a scandal,” says Baden-Württemberg’s Interior and Digital Minister Thomas Strobl (CDU). Süddeutsche Zeitung. “Obviously, the following now applies: concerns first, digitization second.” The federal government is developing into a digital brake. “The technology, innovation and area state of Baden-Württemberg cannot accept that under any circumstances,” announced the minister. There are also warnings from countries such as Bavaria and Rhineland-Palatinate to change the existing funding.
For years fiber optic connections have been subsidized nationwide with a lot of money where the economy is not pushing ahead with the expansion. A mixture of federal and state funds is often used. In this way, municipalities can take charge of the expansion on their own if companies do not want to do this. In 2018, the previous government released twelve billion euros in special funds for the fiber optic infrastructure for four years, which should be allocated by the end of the year. That’s an average of three billion euros a year.
It has been clear since mid-March that Wissing wants to restructure the funding. As a result, less money should flow from the federal government in the future. Because Wissing plans to cap the funding amount at one billion euros per year. However, Baden-Württemberg alone already has a need for federal funds of 500 million euros each for the next two years.
The minister wants to prioritize the eligible regions
In addition, additional hurdles for the use of subsidies are under discussion. Wissing would like to introduce a prioritization of eligible regions. The state could then only intervene in certain areas, in others the economy would have the right of way when it came to expansion. The pace of this, however, is already known in the communities.
Wissing’s ministry rejects the criticism. The gigabit strategy is designed to accelerate the expansion, the response is “very positive”. “Measures are also planned” in the area of subsidized expansion. However, the ministry admits that there is “still a need for discussion” on individual points. The Ministry does not respond to the question of how faster expansion can be achieved with less funding. In this context, a spokeswoman refers to the promises made by industry to invest more in the expansion of the network.
In countries such as Baden-Württemberg, it is also considered sensible to encourage private investment. But they are said to have reached their limits. Without government funding, rural areas would be digital nirvana today. In a joint paper, the municipal, city and district councils of Baden-Württemberg warn against restrictions on funding across all parties. Adequate funding is also needed in this legislative period, according to the paper that the associations are sending to Berlin these days. Helmut Dedy, General Manager of the German Association of Cities, is convinced that the municipalities are best able to assess the local situation. You should therefore decide where telecommunications companies will expand and where funding will be necessary.
Apparently, however, Wissing’s ministry is also concerned that the funding could get out of hand. So far, mayors have been able to ask the network operators whether they want to expand broadband networks in the next three years. If nobody registers for such an area, the municipality can advertise funding. So far, this only applies to regions in which citizens can only book connections with a transmission speed of 100 megabits per second. From next year, the rule will be extended to all regions where there is no fiber optics. A ministerial from Berlin is certain: In view of the increasingly tight budgets, federal policy is probably also being driven by concerns about an even larger wave of funding.