At the beginning of 2023 the Ministry of Economic Affairs and Digital Transformation launched the UNICO Rural Demand program with a clear objective: connect 1.3 million homes and companies in rural Spain to the internet thanks to Hispasat’s satellite internet services. Two and a half years later the project has proven to be an absolute failure. The question, of course, is why.
The promise. Everything seemed fantastic in that project. The idea: offer a 100 Mbps connection at a price of 35 euros per month in those areas where there was no access to networks of at least 50 Mbps. To achieve this, satellite connections from Hispasat were chosen, and the project had a budget of 76.3 million in aid.
From objectives to realities. The objective was for the entire population of Spain to have access to 100 Mbps networks in 2025, and this program wanted solve this challenge for rural areas in which there was no access to lines of more than 50 Mbps. According to government estimates, the project would cover up to 1.3 million homes, but after all this time we have known the number of installations: 11,486. It is a spectacular failure.
Problems from the beginning. The Government awarded Hispasat —recently purchased by Indra— this contract to provide the wholesale service. 42 companies would be in charge of distribution and installation, but as soon as the project began, there was a big problem. Eurona, which was theoretically going to be the main installer of the service (65% of the registrations would be its own), entered bankruptcy proceedings and sold his assets in Spain Serenae.
Telecos did not help. The large operators have not been especially proactive, they say in five daysand they have preferred to promote their fiber or rural 5G solutions even if that meant longer waits for users. The profitability for the operators was very limited, and is estimated at around 75 euros per registration. Telefónica, which should have been the main protagonist of the project, has barely accounted for 10% of the registrations, and curiously small local companies such as Celver, Gesico or Bluetel have doubled that share.
Starlink is a lot of Starlink. Added to all this is the offer of the Starlink service, which is technologically very superior and also with a more attractive price. For 29 euros per month it is possible to access speeds of up to 300 Mbps and, above all, latencies of between 25 and 40 ms thanks to its constellation of Low Orbit (LEO) satellites at an altitude of 550 km. Hispasat satellites are geostationary, they orbit at 36,000 km high and this causes latencies much higher than about 600 ms, which means that videoconferences or online games cannot be held reliably in good conditions.
And now what. The failure has been so resounding that Hispasat has had to return 22 million euros of the total public aid. Of those 76.3 million that came from European Next Generation funds, 36 million were destined to finance the registration costs (installation, antenna, equipment, etc.). The remaining 40.3 million were theoretically invested in the marketing of a service that registered 128,120 eligibility consultations, of which 75,733 met and only the aforementioned 11,486 were executed. The figures are absolutely terrible.
Spain emptied, Spain poorly connected. This fiasco adds to that of other programs such as subsidies UNICO 5G Active Networks who have also had to face very serious obstacles. In March, the call 2024 of said program with aid worth 161.3 million euros to continue extending 5G infrastructure in municipalities with less than 10,000 inhabitants. According to the Government of Spainthis project will allow 326,000 people in small towns to have access to these networks. The funds will also be used to expand 5G coverage across 6,800 km of the road network.
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