A utility based price model for high capacity rural networks in the European Union

The European Union has been battling against the digital divide for several decades now when trying to mitigate the risk of social exclusion arising from the lack of broadband access, preventing citizens from full social and economic participation in the society. This has been done in the past by ensuring that a minimum set of services would be available to all end-users at an affordable price. However, various aspects of the rapid advances in technology, market developments and changes in user demand as well as the evolution of the telecommunications infrastructure (5G, IoT, Cloud, gigabit access, etc) increase the risk that citizens of rural areas are facing a severe risk of digital exclusion. To avoid this risk, the concept of subsidised rural networks was created by the European Commission. The idea as such is laudable, but the price tag remains unknown, which severely violates its implementability. In this article, based on the actual cost in a subsidised, but competitive, environment, we suggest a novel approach to realistically determine fair end-user's prices.