b) Indirect investment: the privately run municipal network model (also known as public outsourcing, or concession model), c) Support of community-led initiatives: the Community broadband model, d) Operator subsidy (also known as gap-funding or private DBO). In this breakdown, the investment model – subsidies to operators to build a network – provides the broadest set of benefits for the current situation in the Czech Republic in relation to the building of access networks, and therefore appears the most appropriate investment model. The main advantages stemming from the use of this investment model are: • Directing investments into areas that are currently not commercially interesting to existing potential investors. In this way the amount of private investments into the building of access networks will also be strengthened, • Limiting the level of public aid to the electively necessary amount, while one of the assessment criteria for investor selection will be the amount of public aid needed, • The possibility to regulate the prices of wholesale services at the level of what is achieved in commercially interesting areas by not including public aid in the calculation of their costs, • Strengthening the competitive environment as networks built partially using public aid will also have to be equipped to provide wholesale services • Transferring risk to the public aid beneficiary, because the state as public aid provider is not directly involved in the deployment of the networks, • A relatively simple contractual arrangement between the beneficiary of the public aid and the donor, and therefore the possibility of relatively rapid project implementation. The fact that the state will not receive financial revenues from the project, which could then be reinvested into the building of future networks, may be considered a disadvantage. Another reason for selecting the Private Design, Build and Operate Model investment model is the fact that it will enable a specific investor to be selected for each area of intervention based on a selection procedure in which the amount of public aid required will be taken into account. The required subsidy amount will be one of the assessment criteria in the selection procedure. This will contribute to creating a competitive environment and an optimised use of public funds. The investment model was already selected in the process of drawing up the OP EIC and adopted by Government Resolution of 14 July 2014 No 581. It was approved by the European Commission’s Decision C(2015) 3039 of 29 April 2015. Public Outsourcing Model will also be supported, if possible and at the same time in compliance with the rules and objectives of the subsidy programme. NGA networks will be built by municipalities, mostly by “overlaying” while building other infrastructure (waterworks, sewage systems, public lighting, pavements, etc.). This synergy will lead to significant total cost savings. Municipalities will be the network builders and owners, with network management provided exclusively by private sector in the vast majority of cases. Thus the wholesale access to the supported network will be guaranteed. In future, the use of other investment models as well cannot be excluded. 30

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