Does Spain have the slowest and most expensive internet broadband service in the whole of Europe? According to a group who should probably know better than most, the Spanish Association of Internet Users, it certainly does. In the first month of this year, the Association complained about the declining number of ADSL connections (the most popular type of broadband connection in Spain), which had fallen by 40% on the previous year. The Association is calling for a liberalisation of prices and the introduction of a benchmark maximum price.

According to recent estimates, fewer than 23% of Spanish homes have a broadband connection to the internet (via ADSL or cable), whilst a further 16% of homes continue to get by with a much slower (and in today’s technological terms, relatively antiquated) dial-up connection. This compares to the UK, where 56% of all households (14 million of them) now have a broadband connection and where dial-up connections are very definitely a thing of the past. According to the Spanish Association of Internet Users, there were 86,404 new internet connections made last November, which is down 40% on a year on year basis. This again compares unfavourably with the UK’s current 40,000 new connections each week or one million additional households every year.

Spanish internet users first began plugging in to ADSL broadband (which uses the existing system of telephone lines rather than dedicated cables) in 1999. The principal internet service providers (ISPs) are:

• Telefónica – the former publicly-owned state monopoly;
• Terra Networks – part of the Telefónica Group;
• Direct Telecom – which provides both ADSL and VoIP (internet telephony) services;
• Wanadoo – which started out as the internet branch of Uni2 Spain and now operates much like Terra, as a reseller of Telefónica’s ADSL services;
• Tele2 – which has bought out Colt Telecom and prides itself on offering faster than average connection speeds;
• Comunitel – currently operated by Tele2;
• Jazztel – the first of the ISPs to provide the faster ADSL2+ service throughout the country; and
• Ya.com – which was set up by Jazztel, but has since been bought by T-Online.

Although there is really no shortage of ISPs in Spain, therefore, the connection speeds they currently offer certainly lag quite a way behind the rest of Europe. The average ADSL speed on offer by all of these companies is a miserly 1024/300 kbps, with costs of about €20 to €39 a month – which is relatively steep given the slow speeds that are on offer. Faster connections offering a maximum 8 Mbps (probably the standard offer in the UK), are available but the price is considerably higher (expect to pay around €150 a month). A notable exception in terms of both speed and price is from those companies (notably Jazztel, Wanadoo and Ya) which offer a combined package of TV/Phone calls/ADSL for between €20 and €30 a month.

The consumers’ principal demands for increased speed and cheaper connections depend to a very great extent on the telecommunications infrastructure. ADSL, of course, relies on existing telephone lines, the capacity of those lines, and the price ISPs have to pay in order to gain access to those lines. The technology of ADSL (Asymmetric Digital Subscriber Service) is by now relatively straight forward and exploits the unused frequencies of the phone line (that is, the parts that aren’t needed for voice signals) to carry digital signals, in the form of electrical pulses instead of sound.

There is a maximum connection speed which can be achieved over such existing – conventionally copper – lines and that speed will be determined by the physical condition of the line itself and the distance the user is from the nearest telephone exchange. Put at its simplest, if you live a long way away from the nearest exchange, you shouldn’t even consider ADSL. In Spain, of course, that could affect large numbers of people and communities, leaving them with the far more expensive options of either cable or wireless provision.

It is precisely this telecommunications or “digital” infrastructure, of course, that is at the forefront of developments in the UK at the moment. It is recognised that existing, copper telephone lines are practically at saturation point and preventing the delivery of faster and faster connection speeds, where 50Mbps is already being explored by Virgin Media. The alternative and obvious successor to copper is a fibre-optic network, and this will obviously prove an expensive form of infrastructure either for the government or private enterprise (and it will probably take a mixture of the two) to provide.

One of the key areas for development in the UK, therefore, will be the replacement of existing copper networks with fibre-optics (which are capable of handling far greater traffic loads at faster speeds). Clearly, this will be a massive and expensive operation. Nevertheless, BT has recently announced a £1.5 billion programme to roll out fibre access to 10 million homes in the UK and the Prime Minister, Gordon Brown, has hinted that development of the “digital infrastructure” might be one of the areas ripe for government-assisted investment as policies are hatched to try to spend the country’s way out of recession.

In a recent consumer survey of UK users’ main concerns about their broadband ISPs, the following six categories were identified:

• Quality and stability of the home  internet service;
• Download times for files and webpages;
• The clarity of pricing and billing systems;
• After-sales support;
• Value for money; and
• Speed of service activation.

As Spanish ISPs – and no doubt the Spanish government – attempt to ensure that they do not miss out on the broadband revolution, they are likely to have to address exactly the same sort of issues currently under debate in the UK – namely the state of the existing telecommunications infrastructure and ways in which competing ISPs can gain access to that upgraded network in order to ensure that healthy competition continues to force prices down. The development of wireless networks, which can avoid the fixed telephone lines altogether, of course, will provide an even keener basis for competition amongst suppliers of broadband services.