Rapid advances in information and communications technology require up-to-date access networks connecting communities, which is considered basic ICT infrastructure. In March 2009, 2,090 out of Hungary’s 3,152 municipalities had access to a minimum of one fiber-optic network, but government intervention is necessary in order to ensure geographically balanced development across the country by supporting locations and communities that are less attractive for businesses – GKIeNET reported in a study published in August 2009.
In 2007 only 1,987 of the 3,152 Hungarian municipalities had fiber-optic access (core networks), reflecting a 63% coverage in terms of the number of municipalities. The March 2009 data indicate that 2,090 municipalities had access to at least one optical network, which reflects a 3.3 percentage point increase in coverage during a period of a little over a year. Theoretically, 194 additional municipalities are slated to get fiber-optic access within the framework of the Economic Operative Program (EOP) 3.1.1 promoting broadband infrastructure projects, however, the program fails to deliver the previously expected results given that a number of winning contractors pulled out.
Optical network coverage in a breakdown by municipality size
Source: GKIeNET Ltd.
18% of municipalities outside the current coverage area could gain access to the nationwide optical network within the framework of the Economic Operative Program 3.1.1. As a result, fiber-optic cables could reach 27% of the smallest villages (with a population of under 250) currently outside the coverage area and 17% of villages with 250-499 inhabitants. Nevertheless, 868 municipalities will likely continue to remain without access to a fiber-optic network due to lack of business interest.
Coverage does not necessarily mean that users are offered actual services through the available optical network, though. In March 2009, 425 municipalities within the coverage area did not actually have access to services due to various reasons, including the reluctance of local service providers to take advantage of the optical network citing high costs, or the lack of active equipment necessary for distribution, or even the lack of appropriate space for the active equipment (central offices, containers, air-conditioned outdoor storage units).
The lack of access to an optical network inherently limits the advancement of ICT services relying on broadband connection. The availability of fiber-optic infrastructure is also a basic requirement for third-generation mobile network coverage. On the following map showing Hungary’s optical network coverage by municipalities (including unincorporated areas within their administrative boundaries) their official outskirts), the colors red and yellow indicate areas currently offering very limited landline or mobile broadband internet access at the most. Government intervention will likely be the only way to offset the market’s failure, given that the private sector is apparently not interested in developing the fundamental infrastructure in these regions, which results in unfair distribution.
Hungary’s optical network coverage by municipalities (including unincorporated areas within their administrative boundaries)
Source: GKIeNET Kft.