Minister Naughten pledges to press ahead with National Broadband Plan, even after Eir exits process and leaves one bidder.
Even with one remaining bidder, Communications Minister Denis Naughten, TD, has made a pledge to get broadband to roughly 540,000 premises in rural Ireland in the next three to four years.
‘300 farms a week are getting broadband and I want to see that momentum continue. The plan is to see 40,000 premises a quarter get broadband until all 542,000 premises have broadband’
– MINISTER DENIS NAUGHTEN, TD
“Based upon the significant commercial issues and complexity within the tender process, together with growing uncertainty on a range of regulatory and pricing issues that reside outside of the NBP process, the company’s board has decided that the risks are too great for its continued participation in the NBP,” the company said in a statement.
“Therefore, Eir has reluctantly taken the difficult decision to withdraw from the tender process.”
The incumbent operator said its existing plan to reach 1.9m premises by the end of 2018 remains, which includes 300,000 premises in rural areas that were agreed with the Government last year.
Eir’s exit from the procurement process comes just a few months after Siro – the Vodafone and ESB joint venture – walked away from the project.
What’s next for the National Broadband Plan?
Naughten said he refused to accept any notion that the plan to connect rural Ireland with 21st-century digital infrastructure was in any way mortally wounded.
Speaking with media tonight in Dublin, spokespeople for the Department of Communications said that the Government is determined to press ahead with the plan and that the final deal hammered with Enet-SSE would represent good value for the taxpayer.
The officials said that, in terms of Enet-SSE’s ability to deliver fibre to 542,000 premises around Ireland, if and when it emerges as the final winner in September, it will be able to contract the build to contractors such as KN, which has already gained vast experience rolling out networks for Eir and other broadband providers.
Asked if the negotiations with Enet-SSE were not successful, the officials said that there was a plan B in place to continue to deploy the NBP regardless.
But the question came up as to whether the final bidder – the Enet-SSE consortium – has the State over a barrel.
Minister Naughten said he spoke with David C McCourt, the owner of Enet, who assured him that the NBP roll-out would be a pivotal win as his group plans to bid for similar deployments in Europe.
“There’s an incentive for Enet-SSE to get started and put shovels in the ground quicker. I spoke to McCourt today and he said he was anxious to deliver and that Ireland would be a shop window for securing other contracts in Europe.
“Scotland, for example, are going down this road. Enet plans to establish its joint venture base here in Ireland and the intention is to competitively bid for broadband contracts in Europe.”
Naughten said that it is not unusual for an incumbent to walk away from such a procurement process.
The Minister said that rural Ireland can rest assured that, even after five years of a wait, the NBP will begin in 2018.
“300 farms a week are getting broadband and I want to see that momentum continue. The plan is to see 40,000 premises a quarter get broadband until all 542,000 premises have broadband.”
The Minister added that checks and balances are in place to make sure the State will not be paying over the odds for broadband roll-out.
He said that the experience and expertise of players such as KN and others in deploying rural fibre so far for Eir and Siro have given more than 80 officials in the Department of Communications working on the NBP valuable insight.
Naughten also confirmed that the deal for Eir to connect 300,000 premises that were originally in the intervention area still stands.
The devil will be in the detail
Whatever the outcome of the enduring NBP saga, it is clear that whoever builds the network of at least 30Mbps broadband for 542,000 premises will still need to access the 76,000km of poles and ducts belonging to Eir.
It is understood that legislation designed to guarantee certainty for access to such infrastructure is in the works.
It is also understood that the Department of Communications is about to sign a contract for 25 years with Eir, to provide added certainty to anyone building the NBP network that they will have access to those poles and ducts. Access to each pole will be set at the ComReg regulated price of €20 per pole.
Department officials said they were confident that, over the next number of months through to September, work between Enet-SSE and 80 department planners will result in a final contract and that, within days of that, shovels could be in the ground.
Let’s hope their confidence is well placed, because 990,000 people in rural Ireland – including 380,000 members of the labour force – are on the wrong side of the digital divide.