04 März Boosting demand for optical fibre connections: a smart end-customer voucher can significantly reduce the need for funding
Cologne, 12th February 2025. For years, industry and politics have been discussing the usefulness of funding programmes for optical fibre expansion. In the new legislative period, old funding habits must finally be broken and new paths taken to significantly increase the demand for optical fibre connections. A well-designed voucher programme can help to ensure that billions of euros in funding do not have to be used in the first place.
For years, VATM has urgently warned of the severe consequences of a failed funding policy. Unfortunately, the development regarding the analysis of the potential for self-financing expansion, which the Federal Ministry for Digital Affairs recently updated, confirms these warnings. The past years‘ funding activities have led numerous municipalities to launch market exploration processes and submit funding requests that have impeded the market-driven expansion instead of accelerating it. Increasing civil engineering costs due to extremely high demand as a result of funding processes have further contributed towards the slower expansion speed. VATM Managing Director Dr Frederic Ufer emphasises: „Under no circumstances should the answer be a renewed expansion of funding“. Instead, we urgently need a smarter funding regime that enables expanding companies to establish large-scale expansion areas (‘clusters’) and reduces funding on the supply side to a minimum and to areas that cannot be economically accessed.
The self-financing expansion continues to be the driving force behind the optical fibre expansion. The key to achieving comprehensive optical fibre coverage is now to quickly and significantly increase the take-up rate, i.e. the number of optical fibre connections in use, throughout Germany. A well-designed, competitively compliant voucher for end customers of both expanding and network-based companies when signing an optical fibre contract could make a significant contribution to this. In this context, the funding must be used to ensure that it contributes to a wide range of providers in the interest of citizens instead of benefiting only a single company, explains Ufer. Furthermore, „the best protection against abusive overbuilding is undisputedly the highest possible utilisation of the networks.“
The managing director welcomes the fact that the study presented today by the consulting institute WIK Consult on behalf of the Federal Ministry for Digital Affairs, “Vouchers as an instrument for strengthening demand for optical fibre”, provides a good foundation for further discussion on the sensible use of vouchers. In its report, WIK comes to the conclusion that the greatest benefit of a so-called connectivity voucher can be expected in areas that are not profitable for self-financing expansion.
„With regard to the difficult budgetary situation currently faced by the federal government, which the experts are right to point out, the new federal government must decide on a concept in close consultation with the industry that offers citizens a strong incentive to switch to optical fibre while remaining justifiable from a budgetary point of view“, adds Ufer. „We firmly believe that an initially higher take-up rate can be supported by such a voucher programme and that this could make the cost-intensive densification from Homes Passed to Homes Connected – and any new funding measures associated with this – redundant.’
