A digest of the top business technology news stories from the past week, beginning with the news EU VAT rules that will affect digital services providers will arise on 1 January.
Dublin: 22.12.2014 08.35PM
When one of the internet world’s most powerful executives has something to say about broadband, a wise government would sit up and pay attention. Today, Google executive chairman Eric Schmidt told the Irish Government it was time to accelerate progress on broadband.
A year and a half ago, on a rainy day in Killarney, Schmidt calmly pointed out: “Broadband leadership will be a precondition for economic growth.”
On a hazy Monday afternoon in Dublin, Schmidt reiterated the same message in an equally calm and assured manner and called on the Irish Government to get to work on making sure the internet can be used to make Irish businesses more global.
A relaxed Schmidt complemented Dublin on the success it is having in being chosen by companies like Google (which now employs 2,200 people in the city), Facebook and Zynga for vital global operations. He noted the competition that exists for skilled talent and then launched into a reasonable argument for the country to get its broadband situation sorted for once and for all.
“Irish businesses are somewhat behind getting online to be where they should be. Google and other companies here should work hard to get more Irish companies onto the internet and then we should get out of the way. But we will also take an aggressive position in favour of the development of broadband.
“You are behind on fibre to the home and you guys are late with respect to 4G rollout. France, Germany and the UK are already ahead of Ireland with respect to citizens and businesses connected to the internet. You just need to do it.
“There are many things that the Government can do, but the thing is it is hard to work with telecoms providers to get more broadband. But these are the roads of the future. There are very few things that are better use of your money that serves the citizens of your country.
“Yes, I am very surprised, you were doing very well with broadband until the financial crisis hit,” he said in a reasonable tone that really means 'don’t mess around on this one'.
Schmidt said it was a message he will be making clear to Government ministers while on his two-day sojourn in Dublin.
“The economic benefit is to get Irish businesses global. The flow through is phenomenal, it creates jobs.
“The key is competition,” he said, pointing to how countries like Japan, South Korea and Singapore are steaming ahead.
“They are viewing broadband as a vital industrial policy and they are creating hyper-connected societies that are growing pretty well. This does matter.”
Schmidt said that objectives set out by the European Commissioner for the Digital Agenda Neelie Kroes of 30Mbps for all EU citizens and 100Mbps for half of the EU’s citizens were laudable targets. “We strongly support that aim and it’s good to have markers that should be achievable.”
Schmidt, who recently stepped aside from the Google CEO role after 10 years to let co-founder Larry Page step into the role, pointed to a McKinsey study that said that for every job lost in the economy another two can be created through investment in broadband.
The global head of advertising and general manager of Google’s Irish operations John Herlihy pointed out that less than 40pc of Irish businesses were online. “This is an economic engine, you don’t need to have all the technical knowledge to be successful online. But from a commerce point of view, it is important that Irish businesses don’t just have brochure ware on their websites but are equipped to compete with the best.”
Schmidt said Ireland’s economic problems have in no way dampened Google’s ardour for growing its Irish operations. The company came here eight years ago with the intention of creating 200 jobs – now it employs 2,200 people and last year announced 200 jobs focused on mobility apps.
“Our decision is nothing to do with the Irish economy, but everything to do with the Irish workforce. Ireland is a great place to run our business. We have access to creative, young people who see Dublin as a desirable place to work. People are coming to Ireland from other parts of Europe.
“We are growing significantly in Dublin. We are very committed here and we’re going to continue. There is nothing happening in the local market that would prevent us from doing that.”
Photo: John Herlihy, vice-president, Global Ad Operations, and the executive chairman of Google, Eric Schmidt