Development of fibre in France: the final stretch
In France alone, the bank has been involved in the financing of 25 fibre optic projects with all the major private operators, enabling the connection of 16 million homes and businesses.
Reducing the digital divide
Having a good Internet connection has become a basic need, just like access to electricity or water. It’s indispensable for everyday life in the modern era, from education to online shopping to telemedicine to working from home. And yet, across Europe, there is still some way to go to reach the EU Commission targets of covering all European households with a Gigabit network and all populated areas with 5G.
To reduce the digital divide in France, the French government was an early-mover, reflected in the launch of its Very High-Speed Broadband Plan in 2013 to bring fast connection to all metropolitan areas by end-2022.
All lights are green
2021 marked a turning point. For the first time, fibre subscriptions surpassed ADSL subscriptions, reflecting the progress. It means internet speeds for those households and businesses that have made the switch are now 10 times faster.
“Fibre coverage is constantly improving and now covers most cities and more and more rural areas in France,” says Laurent Chabot, Co-Head of Infrastructure Finance at Societe Generale. “Since the launch of the Plan, deployment has accelerated and the mobilisation of investors and private lenders has been massive to finance this work, which represents the largest infrastructure project in France outside of Greater Paris.” After a decade of work and more than 20 billion euros invested, the 80% mark for population coverage via optical fibre will be reached in the first half of 2022.
Closing the gap
But the final stretch is often the most delicate. The most remote areas of the country still need to be connected, where 2 million households in rural areas still do not have internet access, and the lack of coverage in smaller towns still needs to be addressed: this last step is the most complex and the most expensive, “but deployment and commercialisation are accelerating”, says Laurent Chabot.
For instance, in the first quarter of 2022, Societe Generale acted as financial and ESG advisor to TDF Fibre, its long-term client, enabling the company to develop existing, outdated, networks and supporting future needs through the takeover or deployment of new networks.
"Projects like this are critical to supporting the development of very high-speed networks in sparsely populated and rural areas, facilitating the development of the socio-economic fabric, reinforcing equal access to information and culture, but also laying the groundwork for a modern digital society", explains Olivier Lafuma, Head of Business Operations - TMT Finance at Societe Generale.
This loan dedicated to the development of fibre coverage in low-density areas in France benefits from the "Social Loan" label (principles published by the Loan Market Association "LMA", the Loan Syndications and Trading Association "LTSA") and thus contributes to reaching the home stretch in bringing country-wide fast internet access across France.
With more than 49 billion euros raised in financing for 51 FTTX projects in Europe, Societe Generale is the leading bank for transactions related to fibre deployment. In France alone, since the first large-scale project financing in 2016 with the "Alsace Broadband Project" including the design, construction, and operation of a broadband infrastructure in the Alsace region, the bank has been involved in the financing of 25 fibre optic projects with all the major private operators, enabling the connection of 16 million homes and businesses.