BT gets sign-off to start €500m investment

4 Dec 2006

BT Ireland last week obtained sign-off from senior management to commence capital expenditure on the national rollout of next generation broadband services as part of a €500m investment package, the company’s chief executive Danny McLaughlin told

He also said that the company will commence trials of its BT Vision television service in Ireland in the next three to four months with a view to launching services commercially in the Republic of Ireland in the summer months.

BT this morning launched its BT Vision broadband-based television services in the UK and Northern Ireland that will pitch the telecoms giant against BSkyB and NTL/Virgin.

The service is delivered through a set-top box called the V-box which contains a personal video recorder (PVR) that can store up to 80 hours of television. Viewers can obtain freeview channels as well as digital TV stalwarts such as Channel 4, Disney, Dreamworks, BBC Worldwide and National Geographic.

“We’ve done deals with all the big studios but one of the more compelling aspects of what we’re doing is on the sports side. We’ve done a deal with Setanta that will allow us to show 45 live FA Premiership League and 60 Scottish Premier League games.

“This service is being positioned to attract viewers in the living room as opposed to solely broadband to the PC, which would be too niche. To get it right and achieve a combination of quality of service we are targeting it at our Total Broadband customers who would enjoy 3Mbps to 4Mbps of broadband,” said McLaughlan.

He explained that while the service will be trialled in Ireland in the next three to four months with a view to a summer launch, potential customers would need to enjoy at least 1.4Mbps of non-contended broadband, “which based on the present bitstream offering is just not possible right now in the Republic.”

He added: “Before we launch the service in the Republic we need to make sure that all the various content rights issues are resolved. But the more challenging aspect will be delivering the right speed of broadband to make it happen.

Last month BT announced that it was planning to invest €500m in its next generation network, which could deliver up to 24Mbps of broadband on a wholesale basis. However, at the time McLaughlin told that the slow rate of local loop unbundling (LLU) progress could impair the investment path.

“Delivery of such services depends on LLU and converting customers from bitstream to LLU. We’re very frustrated at the speed of progress on LLU in Ireland,” he said this morning.

However, he confirmed: “We are in contact with Eircom on the issue and last week we got the capital investment signed off on the project. We are ready to rock.”

He contrasted Ireland’s LLU situation, where BT has only 2,000 actual LLU customers despite unbundling 48 exchanges, with the UK where there are one million unbundled lines out of nine million broadband users.

“There are no technical reasons why LLU can’t be successfully rolled out in the Republic. My feelings are optimistic that the sports content will be available to Irish consumers in the summer. LLU is a high priority in this regard. The truth is that LLU is being resolved in every other jurisdiction around the world. We are here and we are committed to investing in infrastructure to get these services into Ireland as fast as possible.”

Referring to last week’s Forfas report which lampooned Ireland’s permanent position at second last in the OECD in terms of broadband penetration, McLaughlin was adamant that broadband penetration would accelerate exponentially if LLU became a reality.

“There is no question that LLU would accelerate penetration if we get to the promised sufficiency of LLU. We are working with the industry, government and regulator to resolve the problem. We want to get to 100pc penetration like we have in Northern Ireland. It is possible. There are no technical reasons why it can’t happen.”

Asked his perspective on the appointment of Mike Byrne as chairman of the Commission for Communications Regulation to replace Isolde Goggin, McLaughlin said: “Given where we are right now he has got a real opportunity to make sure his regime puts down its own stamp and get things back on track again.”

By John Kennedy