Broadband situation is deteriorating, says Forfás

5 Dec 2005

Ireland’s position in the broadband stakes has deteriorated from 18th out of 21 in 2004 to 19th out of 21 in 2005, the Irish State’s economic think-tank Forfás warned today. The country is now the second lowest of the EU-15 countries in terms of DSL coverage by population.

In a report issued today, entitled Bencharking Ireland’s Broadband Performance, assessing Ireland’s competitiveness in terms of broadband availability, take-up, quality and choice, Forfás acknowledged a significant growth in take-up of broadband from 63,000 in Q2 2004 to 175,500 in Q2 2005.

It also noted a decline in prices and the continued rollout of the government-backed metropolitan area networks (MANs) and county and group broadband schemes. However, in spite of these developments, the nation’s broadband take-up performance has not improved.

At the end of Q2 2005, Ireland ranked 25th out of the 32 countries for broadband take-up. When the comparator group is limited to 21 countries benchmarked in the 2004 study, Ireland’s position has deteriorated from 18th out of 21 in 2004 to 19th out of 21 in 2005.

In terms of broadband costs, the cost of entry-level DSL in Ireland has decreased significantly since the services were launched in 2002. Based on the amortised monthly costs for 1Mbps DSL, Ireland currently ranks 7th cheapest out of 32 countries benchmarked.

However, in terms of broadband take-up by SMEs Ireland ranks 17th out of 20 EU countries for take-up by companies with a workforce of between 10 and 49 employees and 19th out of 20 for take-up by companies employing between 50 and 249 people.

Broadband availability in Ireland was also claimed to be poor with DSL coverage based on population standing at 72pc, making the second lowest of the EU-15 countries.

A broadband innovation index used to measure quality of services (bandwidth capacity/choice of advanced products) ranked Ireland 21st out of 30 countries.

Despite the fact that broadband take-up in Ireland is increasing, the chief executive of Forfás Martin Cronin warned that take-up in other countries has also growing and as a result Ireland’s relative performance has not improved.

Cronin said: “Broadband is of key strategic importance to economic growth in all sectors and particularly with respect to improving Ireland’s productivity performance. In light of this, continued poor broadband performance will have serious implications for our future economic success and competitiveness.”

He continued: “Greater competition both between infrastructure platforms (such as cable and DSL) and within the DSL market, as well as initiatives to drive demand, for example, the integration of ICT into the education system, have emerged as the key factors driving broadband take-up in other markets.

“To bring about the change needed to improve Ireland’s broadband performance requires the engagement of all stakeholders from government, the telecommunications industry and broadband users. Forfás is engaging in further consultation with stakeholders to develop detailed policy recommendations that will effect the change required,” Cronin said.

The Forfás report makes disappointing reading says IrelandOffline spokesman Damien Mulley: “This report is one Christmas present that Santa can keep. 2005 has been an annus horribilis for broadband in Ireland. Last year we looked towards 2005, hopeful it would be a good year but after court cases and immense stalling we seem to be even further away from the [Communications] Minister’s conservative target of 500,000 connections.

“What we all need to do is admit that the 500,000 target, like so many other targets before it, will not be reached. Instead of setting another target we must all, along with the Minister, critically examine how we got to this shameful position in the broadband world and start taking immediate action,” Mulley said.

By John Kennedy