The Friday Interview: Tommy McCabe, TIF

12 Jan 2007

This week’s interviewee is Tommy McCabe, director of the Telecommunications and Internet Federation (TIF) at IBEC

The past few months have been punctuated by major capital expenditure announcements by both Eircom and BT. What effect will these have on the competitive telecoms landscape in Ireland in the years ahead?

The Irish telecoms industry as a whole is investing heavily in infrastructure. The Government and OECD have given definite targets and industry is making strong moves to meet those goals. For example, Minister for Communications Noel Dempsey TD, speaking at the Commission for Communications Regulation (ComReg) conference, announced that industry had hit his target of 400,000 broadband connections ahead of time.

The Eircom and BT announcements show that competition is heating up, with different organisations investing in the market and developing new and innovative product offerings.

In terms of the mobile arena, Vodafone and O2 are in the process of rolling out their HSDPA products and 3 has revealed plans for a mobile broadband product. Do you think that the mobile market may go in the same direction as that of fixed insofar as voice revenues will decline only to be replaced by broadband and infotainment revenues?

I think data and infotainment services will complement the current voice revenues rather than replace them. The reduction in fixed-line voice revenue is more due to the growth in mobile phone usage rather than consumers preferring data services.
Ultimately telecoms convergence will reach a point where all services are data but there’s still quite a long way to go before operators use a pure voice over IP business model.

At present, 85pc of the Irish country can be served with broadband. What do you think should be done to bring Ireland to 100pc?

There are a few strands to reaching the final outliers. Industry is investing in the infrastructure in order to give the widest reach that they can economically sustain.

This has required the innovative use of various network technologies, both wired and wireless. But that in itself will not get the full 100pc; Minister Dempsey announced that funding would be allocated to provide broadband to areas that are currently not economically viable but the mechanism for this has yet to be defined.

The TIF Broadband Taskforce is formulating recommendations as to how the process could be developed to the benefit of all stakeholders.

Despite a large proportion of the country already being serviceable by broadband, about 13pc of the population have signed up for broadband. Is it a demand problem or a supply problem?

We have to note the difference between 85pc availability and a much lower take-up.

That said, we have seen a real surge in penetration in recent months.

Broadband services come in a variety of prices and quality levels to suit all budgets; prices are certainly in line with EU averages. I think a few areas could be progressed: PC penetration; public awareness; more and better services provided online, both public sector and private sector.

Once businesses and residential consumers really see the benefits of what broadband can do, then we will see even stronger growth.

It has been suggested that in order to boost PC and broadband penetration, tax breaks and other benefits would be key. Do you agree?

The Department of the Taoiseach is currently examining the viability of a ‘home computing initiative’ to stimulate PC purchasing and to demystify the technical jargon for the average consumer.

They have not currently committed to any financial backing in terms of funding or tax breaks. TIF believes that financial measures could give the initiative more impact and we would like to see an analysis of what could be done and how it would benefit society and the economy overall.

By John Kennedy

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