‘This generation’s appetite for online must be matched by education system’

15 Jul 2009

Future generations will want Ireland to be a science and ICT leader – Telefónica O2’s Danuta Gray.

One of the advantages Danuta Gray, chief executive of Telefónica O2 in Ireland, gets from her role is a world view and where Ireland sits in the global scheme of things. She can see how this country and others like Singapore, Malaysia, Australia, the UK and the Nordics are all positioning themselves to be the next Silicon Valleys.

As the second-largest mobile operator in the Republic, with 1.4 million subscribers, Telefónica O2 is battling its way through a tough climate. Service revenues up to the end of March were down 5.6pc year-on-year to €210m. Data revenues now account for 10.3pc of overall service revenues. Average revenue per user is down 9.3pc year-on-year to €39.30. At the same time, the company is seeing growth in mobile broadband subscribers, which now stands at 105,305.

Telefónica O2 is facing the same challenge as other operators across the industry, but at the same time a portal is opening to a vibrant new future where smart phone devices such as the iPhone and consumer and business users’ appetite for always-on connectivity will fuel growth over the next decade.

But it is as a parent of two boys, aged 11 and 13, that Gray is also gaining insight.

“If they want to find out more about something they learnt at school, they just Google it. Their expectations are of a more interactive, more visual world where they can create things and upload them for the world to consume. I suspect this generation’s appetite for the online world isn’t being matched by the education system.

“I get worried when I see that less than 20pc of students are sitting honours maths in the Leaving Cert. If we don’t create the foundation for people who have a genuine desire to do science, technology and computing studies, we won’t have the raw skills needed to take advantage of the innovations and ideas that will be part and parcel of this exciting new world we’re in.”

Gray points to Ireland’s successes with the IFSC where the taxes, the grants and the educational pieces of the jigsaw were put in place.

“That industry had a sexy image and therefore attracted the talent. But when it comes to science and ICT, those pieces aren’t in place. We’re not making heroes from the kids in Ireland who have gone through the education system and are designing games or creating software.”

Gray, who has a science background herself and is chairperson of Barretstown and a non-executive director of Aer Lingus, urges we promote young heroes.

“If a 19 year old like Patrick Collison can build and then sell a company for around $5m, we need to be championing another 100 like him. If we really want to make this smart economy a reality, it’s about the whole country buying into the vision as well as putting the right infrastructure in place.”

Her view is that a truly long-term vision or development plan needs to be implemented. “I used to live in Munich. Forty years ago, Bavaria was very much an agrarian society. They decided that a long-term plan was needed to develop the region and for 40 years focused on technology, with the creation of technology clusters and brilliant research being at its core. They made heroes from scientists, engineers and mathematicians and stuck persistently to their vision.”

The prize, Gray says, if Ireland does this, will be enormous. “But I look at Ireland with its large geography and low population and have to be realistic. If we focus on a few specific things and make priorities, as you would with any business plan, we can make great headway. Is it nanotechnology, biotechnology? Do we need a super-fast fibre infrastructure? Yes we do. If you have a plan that’s too broad, there are risks and you could still be just talking about it in three years. An action plan is needed.”

The mobile business that O2 is in is morphing into a complete telecoms industry, where operators will provide both wireless and fixed services as well as advanced IT services and home entertainment if necessary. It is an era of profound change for an industry that, in reality, is only a decade or so old.

Having won the global competition to be the exclusive provider of Apple’s ground-breaking iPhone – now in its third generation – and lately Palm’s new Pre handset, Gray says that advanced internet connectivity on the move is transforming the mobile business.

“It’s not just the function and the features on its technologies, but Apple combines this with a genuine intuition for how people do things.

“The iPhone and the new generation of smart phone devices have changed the way people see the internet on the move. Now it’s real. We see a strong future for other devices, as well from low-cost netbooks to mobile internet devices, because the true value of knowledge on the move has been unlocked.”

In terms of the business world, the move to cloud computing – software for businesses via the internet – is something Gray is keen to embark on, but will do so by partnerships with specialists in the field.

“The large companies are able to move rapidly in this direction, but the reality on the ground is that small businesses are fighting for survival and are concentrating on cash flow. This is making them conservative and unwilling to take too large a leap of faith. So it will be a longer process.”

Like all telecoms operators in the Irish market, Telefónica O2 has its eye on next-generation networks and evolutions in the world of 3G towards super-fast wireless services such as Long Term Evolution and WiMax. And like all operators in the market, investment hinges on what the Government is going to do in terms of rolling out a future fibre infrastructure and what the industry will do itself.

“It’s all about return on investment. Shareholders need a degree of certainty, so regulation is critical for this. A decision needs to be made. Will it be a top-down investment by the Government or will it be industry working in co-operation and collaboration? If it’s the latter, then the regulatory environment needs to be urgently put in place.

“Ireland’s future will pivot on a number of things: ICT, science, a secure energy supply and an enabling environment for its young entrepreneurs. This isn’t something that can be done with a three- or four-year plan. We’re talking about a vision for the next 20 or 40 years,” Gray concludes.

By John Kennedy 

Pictured: devices like the iconic iPhone 3G S and the forthcoming Palm Pre are inspiring a new class of consumer and business user who will require information on the go, says Danuta Gray

This story is part of the Digital 21 campaign to encourage Ireland to develop a National Digital Development Plan, ensuring the country and its economy are strategically well placed to thrive in the 21stcentury. For morestories, and to add your comments, visit www.digital21.ie.