Eircom’s €100m NGN plan to upgrade broadband for 1m

29 Mar 2010

Eircom has confirmed that a number of telecoms operators are signed up to access its next-generation broadband (NGBG) network that will give every DSL subscriber entry-level broadband of up to 8Mbps.

The incumbent operator this morning told Siliconrepublic.com that it will upgrade broadband users to eight times faster speeds than the lowest broadband service for free over the coming months, and the plan is to ensure that 1m people can receive 8Mbps broadband by the end of the year.

CTO Geoff Shakespeare told Siliconrepublic.com that the upgrade is, metaphorically speaking, a move from single lane highways to 16-lane highways in terms of speed.

He confirmed that the upgrade – which involves deploying transmission solutions to layer 2 and layer 3 parts of the Eircom system as well as migration from DSLAM to new Ethernet over WBN backhaul – represents an investment of some €100m.

Eircom broadband upgrade

CEO Paul Donovan said that Eircom’s entry-level 1Mbps broadband will automatically move to 8Mbps and that broadband customers on 1Mbps, 3Mbps and 7Mbps broadband will be upgraded for free.

The new speeds will be initially available in Dublin but the upgrade will be extended to all major urban areas, including Cork, Limerick, Galway and Waterford by the end of the year.

In terms of consumer products, 8Mbps NGB Basic (10Gb download allowance) will cost €24.99, including VAT. The 8Mbps NGB Regular (with 30Gb download allowance) will cost €29.99 a month and NGB Advanced (with unlimited downloads) will cost €39.82, including VAT.

For businesses, Eircom’s Business Lite Next Generation with up to 8Mbps with a 10Gb download allowance will cost €20.65 ex VAT, while Business Lite Plus Next Generation will have a 30Gb download allowance and will cost €24.78, ex VAT.

Donovan said that by the end of this year, 60pc of Eircom’s network will be upgraded to NGB.

One of the most important elements is the sea change in Eircom’s attitude to wholesale. Donovan quipped that previously you would never have seen an Eircom wholesale executive at a press conference.

‘An economic asset’

Wholesale manager John McKeown got straight to the point: “This is an economic asset. If Ireland is going to get out of the economic doldrums, it is important that this asset gets used as much as possible. We will be sharing this asset with wholesale customers.

“We listened to them and there were four key points: scale, capability, control and value. In terms of scale we can give them the ability to sell high-speed broadband to more than 1m phone lines. In terms of capability, under the existing regulatory regime, products were slimmed down and they weren’t able to specify the user experience to customers. With NGB, they’ll be able to specify speed and contention.

“In terms of control, the flexibility of unbundling model, without investment in all the network assets, they’ll have an open port without the big upfront investment. And in terms of value, with up to 8Mbps, they can specify products they want to sell from €4.90 wholesale prices. We consider this a good response that indicates Ireland’s digital nervous system will be in good rude health. We spent a lot of money building this network, we’d like them to use it. We’re open for business,” McKeown said.

Asked if the NGB plan will make use of Eircom’s Meteor mobile network to bridge broadband in areas not connected to DSL, Donovan said: “What we’ve done, it is very clear that there’s no point rolling out a ‘me too’ 2Mbps indoor experience. Given that mobile is a shared medium, we will have taken out the access contention issue. At this 150 of aggregation, sites are fibred up. In effect, 40pc of our mobile base stations are fibre ready.”

In terms of the road map for the new NGB infrastructure, Donovan said the next step on the road map is to move to 24Mbps speeds. “The reason why we have gone for 8Mbps to start with is to meet as many customer needs first.”

Fibre investment across Ireland

Donovan said the NGB is a precursor to the inevitable fibre investment that will be needed across the entire country. “Along with the other CEOs of incumbents around the world, we all want the same thing. We want to have an underpinned business model that can make sure that what will be a major capital investment will get a major return.

“We need to work out the regulatory models around fibre to lay that future down and reduce the amount of risk. I want to make it very clear that I don’t believe in the future Eircom will be the sole provider of fibre in this country.

“We need to make sure that access happens and that telecoms companies work together to reach as many households as possible.

“It would be a tragedy in the fibre world if we were to repeat the errors of the past, where networks overbuilt in certain areas where would be huge amounts of theoretical capacity. It is very much our challenge, as well as our partners’, in industry. We are coming at this with a much more open perspective than we would have in the past,” Donovan said.

By John Kennedy

Photo: Eircom CEO Paul Donovan

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years