Putting fibre in Ireland's comms diet
Outgoing BT Ireland CEO Graham Sutherland
Ireland is finally about to get to grips with the deployment of next generation network infrastructure. Outgoing BT Ireland CEO Graham Sutherland welcomes this but urges greater regulatory certainty and the need for cross-industry co-operation to ensure Ireland has the infrastructure to compete in the 21st century global digital economy.
If there is anyone who is expert on the realities of rolling out fibre infrastructure and future wireless technologies, it is former BT Ireland CEO Graham Sutherland.
Sutherland has been promoted to managing director of the BT Business Group in the UK, where he will preside over a stg£2.3bn a year business.
By next year, Northern Ireland will have 90pc of homes connected to fibre broadband, making it the most connected geographic area in western Europe. BT is currently building a Total Transmission network, which involves an advanced next generation fibre network in the Republic of Ireland being rolled out.
BT, which has deployed the bulk of Ireland's mobile networks for companies like Vodafone and 3, signed a multimillion deal two years ago to transfer BT's consumer, small business broadband and voice customer base to Vodafone.
BT continues to invest in local loop unbundling (LLU). With 50 exchanges now unbundled, the company has the capability to deliver high-speed broadband to more than 700,000 phone lines in the country.
As well as ICT and telecommunications infrastructure, BT has also played a critical role in supporting science at second-level through its steadfast support of the Young Scientist & Technology Exhibition over the past decade. It recently committed €2m to sponsoring it for a further three years.
I ask Sutherland how he views Ireland’s progress in terms of getting to grips with next generation infrastructure and empowering young people and young businesses to be able to direct their own economic futures.
“I think it is moving apace. Our young people are driving this agenda. I even feel more strongly about infrastructure and the speed of deployment now because I think how we do business and how we communicate, all those things are changing day by day and the future workforce of the next 10 or 20 years, for them to be successful it’s important you have world-class infrastructure.
“All the signs are pointing to that and the one thing we have in our country is by nature we are fairly innovative and entrepreneurial, we just need to make sure we have the tools to optimise that. I firmly believe that.”
In recent weeks Communications Minister Pat Rabbitte set up a high-level taskforce consisting of industry CEOs and department officials, and said he intended to see Ireland achieve EU Commissioner Neelie Kroes’ targets of 30Mbps broadband to all citizens and 50pc of citizens subscribing to 100Mbps by 2020.
Sutherland views this as a positive development. “It is particularly welcome and the work that has gone in for the first session of it has been really positive. The follow-up now for the next session is the key. We’re looking for targets to be agreed by the industry and the Government.
“Without that you don’t really have something to focus on and self-interest gets in the way. We still have to understand what’s not economic. The digital divide issue will manifest itself and magnify if you don’t deal with it.
“I do think eventually there has to be some funding and a tender that enables the non-economic areas to move forward at the same pace.
“What we’re learning from here is that the actual noise around broadband is increasing, both positive and negative. As we expand the infrastructure and capability everybody wants more. So until you get to as close as 100pc with high-speed broadband you’re going to get more noise, more demand, far more stakeholders interested in when are we going to be finished.”
Sutherland says that there will be pent up demand for consumers, businesses and SMEs as internet applications get faster and more demanding.
“If anybody doubts the need for this see what’s happening when you physically do it and start seeing demand rising. You get tremendous feedback from people who have it. I think it is quite amazing and I think the countries that get their first will have a tremendous advantage.”
The e-commerce imperative
At present only 20pc of SMEs in Ireland are active on the internet and transacting via e-commerce, compared with 40pc of their counterparts in the UK. Irish people spend €3bn online per annum, with €2bn of this being spent on products and services that originate outside the country. Isn’t it time that more was done to help businesses gain from the connected economy?
“I 100pc agree,” replies Sutherland. “And it’s not just the €2bn that’s going out, it’s actually what could be delivered from here out as well so you’ve got a double hit on it almost. We’re absolutely seeing more innovation coming from small businesses that have access to high-speed broadband who’ve moved from the 2Mbps or 3Mbps speeds to 30Mbps plus. That’s there to be seen.
“It’s transformational. I’ve almost become more passionate about it in the last few months as we get closer to finishing the job in Northern Ireland and I’m determined, particularly with the taskforce, to make sure that we can try and get past this.
“Everybody’s got their own angle. The reality is we have to get the job done and as we said all along, you’ll have open access questions and fixed and mobile will be key.
“I think it can be done, all the right people are at the table and there’s the potential to do this relatively quickly if we can get a common approach to it.”
But, Sutherland warns, other countries are steaming ahead with their plans and in the race for digital dominance those who move first have the most to gain.
“I think the UK is beginning to move quite quickly because all the parties are aligned and they have public funding set aside to do a proportion of it. The BT UK fund is stg£600m over two or three years added in to BT’s committed investment. Before anyone else does anything that’s over stg£3bn investment.
“In Ireland we think that €500m or €600m will get us across the line if you attract private investment on top of that. That’s to do the infill piece, so you look at what’s been invested by the private companies now, plus dealing with a tricky economy, the job could get done. It’s just the timing. If we can get the taskforce to agree targets quickly, that sets an agenda and gives a vision and a plan for what you can achieve. The key is to get Government and industry aligned and ComReg aligned too.”
Sutherland believes Neelie Kroes’ setting out of targets for 2020 for broadband penetration have been beneficial but leave scope for countries to take their eye of the prize. “If industry and the Government come together and set their own targets that we think are relevant to Ireland’s opportunity, it could add 1pc to GDP. That would be significant in the current environment.”
It’s about unlocking this mixture of private and public investment in a way that encourages things to be done much quicker, he notes - something that has already been achieved in Northern Ireland.
Bridging the digital divide
“If we can get the taskforce to agree on what it is going to do on infrastructure with its targets and delivery and execution, there’s nothing to say a similar approach round e-services for citizens, social inclusion and optimising the power of that infrastructure for the greater good could work well to be perfectly honest,” continues Sutherland.
“I think you have to bridge the digital divide to be able to deal with this on an even basis across society. I think a lot of the apps are there already and you’ve got loads of different examples whether its healthcare or general public services. But you do need to have a national approach to actually optimise it.
“Just allowing the market forces to decide, it will get there eventually, but there are competing priorities. If taken on as a national initiative, again I think you would get there much quicker.”
For the Government, Sutherland says it is vital to think of the savings that could be achieved and so any investment in time will work out as a self-funding exercise.
“You have to target a few areas first and demonstrate the benefit, but you do need an ethos and a policy. We need substantial improvements in infrastructure to deliver that fairly and effectively,” he concludes.
Graham Sutherland was until recently chief executive officer (CEO) of BT in Northern Ireland and the Republic of Ireland. He has just been promoted to managing director of the BT Business Group in the UK, where he will preside over a stg£2.3bn a year business.
He joined the communications and IT services company in 2006, and previously held the role of CFO. Prior to joining BT, he was managing director of NTL Communications in Ireland. His previous roles include director of finance and general accounting at Bombardier Business Jet Solutions; managing director at Maydown Precision Engineering; and finance director, Alex M Hamilton & Company.
Sutherland sits on the board of Business in the Community (BITC) in Northern Ireland and holds a BA in accountancy and finance from the Heriot-Watt University in Edinburgh. He is also an associate member of the Chartered Institute of Management Accountants.
Ireland's tech leaders will discuss Ireland's digital future at The Digital Ireland Forum on 30 September 2011.