Ireland’s broadband growth lags OECD

14 Oct 2005

Ireland now ranks 19th in the world, after the Czech Republic, in terms of the percentage of households with broadband access, according to a new Science, Technology and Industry scoreboard from the OECD. The survey reveals less than 10pc of Irish households have broadband, compared with South Korea where 86pc of households now have broadband.

In terms of business use of the internet and broadband, Ireland showed a mixed picture. While 95pc of Irish businesses have internet access, a mere 38pc of Irish businesses actually have broadband.

The league table, which charted growth in broadband access between 2000 and 2004, revealed that in 2004 South Korea led the world with 86pc of households and 96pc of businesses having a broadband connection. Iceland was second in the world in terms of broadband per household with approximately just under 50pc of households boasting broadband access. Our nearest neighbours, the UK, was revealed to have 20pc of households online.

Use of the internet by businesses (with 10 or more employees) has become fairly standard practise in most OECD countries. In 2004, Japan, Belgium and the Nordic countries all had access at greater than 95pc. A further eight countries reported access levels over 90pc. In terms of businesses that use broadband platforms to connect to the internet Korea led with 92pc of businesses having a broadband connection. It was followed by Canada (82pc) and Denmark (80pc).

It is understood that at present there are some 175,000 individual broadband connections in Ireland – far short of the 300,000 target for July this year set by the previous Minister for Communications, Marine and Natural Resources Dermot Ahern TD.

The poor performance by Ireland in the latest OECD league table was lamented by broadband campaigner Damien Mulley of IrelandOffline. Mulley said: “This information charts broadband growth over four years and shows that despite what has been said about our tremendous growth rate, we are getting nowhere. We’re still towards the bottom of the broadband table, no inroads have been made and with current weekly sign-ups decreasing we will not start jumping ahead of anyone.

“Ireland is like a Formula One car that has just been started up even though the race has been long under way. We’ve accelerated from 0-150mph in a short space, but so did every other car in the race when they started. This acceleration got us on the track and now we are going to have to catch-up but we’re six laps behind and going at average speed. What we need now is a turbo boost. What’s the turbo boost? Ministerial intervention,” said Mulley.

He continued: “While there’s no quick fix for something like this, we don’t even seem to have a cohesive long-term plan. Minister Dempsey needs to acknowledge and work off one of the many suggested plans from the Information Society Commission, Forfas or the Oireachtas Report on Broadband. He also needs to give more powers to the Commission for Communications Regulation (ComReg) to turn them into an aggressive player. These powers should include the ability to split Eircom into a wholesale and retail division, but only if it is needed.”

The commercial director of BT Ireland, Peter Evans, agrees with Mulley on the fact that Ireland is playing catch-up with other countries. “When you hear people saying Ireland is growing fast in terms of broadband, you need to realise this is from a tiny base. The rate of growth in Ireland is high but the numbers are much lower than other countries. Some eight million people in the UK have broadband, they could grow at a low rate and still grow faster than we can. We’re at less than 10pc on the household side which is poor. The most worrying point is we have observed that the rate of growth has slowed down in the last six months.

“While other countries have seen a constant upward curve and reached an inflection point, we haven’t hit that inflection point. While we are not plateauing, the rate has slowed down. You can see that clearly in the recent ComReg quarterly report. We saw big growth 18 months ago, but since then that’s all stopped and the rate of growth has slowed down.”

Evans continued: “There are people trying to defend Ireland’s poor broadband performance and they will say PC penetration is low at 45pc compared with the UK at 60pc. But by no means is that the only reason. Vat rates are high, prices are high. The key is getting Irish prices close to the European average around the €20 to €25 mark. We need to be at that level not the €30 point we are at today.

“And then there’s general awareness; people are not aware of the benefits of broadband. The industry is not marketing broadband very well. There is a lot of hype and buzzwords being bandied about but the ordinary ‘Joe Soap’ in Ireland is happy with dial-up and a little bit of surfing. They don’t see why they should spend three or four times what they are paying to get faster broadband. Last year, when people trialled broadband, many stayed but now inertia has set in,” Evans explained.

By John Kennedy