Is Apple’s Athenry data centre project dead or alive?

6 Nov 2017

Athenry Dominican Priory. Image: Rihardzz/Shutterstock

As Apple’s Athenry decision hangs in the balance, Ireland has been taught a valuable lesson in how the fast will eat the slow in the digital economy, writes John Kennedy.

Every Monday across the world, in the majority of organisations, a ritual leadership meeting will take place, where roughly the same template will be followed to bring everyone up to speed on performance and progress.

In one such business, a gigantic tech company in California called Apple that is whizzing towards a trillion-dollar valuation, Monday morning meetings are held without fail.

The interesting thing about Apple is that, despite its size, its rate of innovation, its popular products such as the iPhone, its hundreds of millions of dollars in annual revenue, its almost $400bn war chest in terms of assets, its close to 500 retail stores worldwide and its 123,000 workers, it keeps things small, clear and uncomplicated at the top. That’s because what it does is complicated enough.

Despite the complexity of making devices such as the Mac and being at the forefront of engineering, finance and physics, as well as being a fast-growing cloud services business, Apple really only has a handful of core products. The management team at the very top is kept intentionally small and nimble, possibly for clarity’s sake. As well as CEO Tim Cook, we see each of those familiar faces rolled out on stage each year, such as Eddy Cue, Jeff Williams, Phil Schiller, Jony Ive or Angela Ahrendts, all commanding vast portfolios with vast responsibilities.

Each Monday meeting probably starts with familiar banter and gentle ribbing before everyone reports what’s going on and decisions are made for the weeks and months ahead. Today (6 November), they will probably ask Cook about how he got on with An Taoiseach Leo Varadkar, TD, who visited the Cupertino HQ during a whistle-stop tour of Silicon Valley tech companies. And maybe, just maybe, the question will come up about the proposed Apple data centre in Athenry, which has been held up by a farcical planning and legal jam for two years.

You see, it was also a Monday morning two years ago on 23 February 2015 that Apple announced it was building its €850m data centre in Athenry while also building a similar one in Denmark. I should know because, as usual on a Monday morning, I was up at the crack of dawn, and was one of the first to report the news.

But, two years later, despite recent jubilation among the local people in Athenry after finally making it to the High Court where the judge gave the project the green light, there is still no guarantee that it will actually go ahead.

The shock news on Friday evening as everyone headed off to the weekend was that Apple would give Varadkar no commitment that it was now actually going to proceed with the project.

Yes, that’s right, the two-year delay has given Apple ample time to reconsider the project. I had warned before that the train might leave the station.

Congratulations, Ireland. Your planning and legal system has succeeded in snatching defeat from the jaws of victory and now, the biggest capital investment project west of the Shannon hangs in the balance.

Everything pivots on what is decided in that boardroom in Cupertino. That decision might be made today, or in the coming weeks.

Who do we blame? I, for one, do not blame the three people who objected to the project for various reasons. In fact, I would defend to the death their right to object or appeal. That’s because this is a democracy and these people were exercising their rights.

The blame really goes to the system that could allow such a project to run the gauntlet of courts and procedure for as long as it did. These companies move fast, not ponderously slow like our centuries-old legal system.

Apple, a long-time investor in Ireland since 1980, probably had a sense of what was to come and asked for the case to be fast-tracked. Instead, the case was cancelled and rescheduled at least three times during the summer months.

Ironically, it is only last week that the Irish Government was able to confirm that planning permission for data centre projects will be fast-tracked under the tagline ‘strategic national infrastructure’. However, the fear is now that Ireland’s crotchety legal apparatus has upset the Apple cart.

How is it Facebook CEO Mark Zuckerberg was able to tell Varadkar last week that it is now building its third data centre in Clonee, Co Meath, which will be 100pc powered by renewable energy, while not a sod has been turned in Athenry?

Knowing the immense value of this infrastructure and the fact that players such as Interxion and CyrusOne are planning more data centre infrastructure in Dublin, the Government has to act.

It’s a pity it didn’t act sooner.

The Digital Agenda should be about sharing best practice

Data centres are indeed the engine rooms of the digital age and, with about 30 of them across Ireland, they are of pivotal value to the nation.

However, declaring them ‘strategic national infrastructure’ might be a step too far and lead to further time-delaying debate, because surely aren’t roads, hospitals, schools, broadband and water also strategic national infrastructure?

The issue isn’t about cherry-picking data centres as valuable infrastructure that should be fast-tracked above other projects, but why should things take so long in the first place? Why did the system fail the West, Apple and the State so deplorably? How can we learn from all of this and put in place systems that can give yes or no answers at a faster rate and save people and organisations so much trouble and cost?

If anything, why not look to Denmark and ask what worked there? Just like we should look to Germany and wonder why the health system there helps citizens much better than the one in Ireland, which sees €10bn or more every year pumped into a chronically sick system that never works? The Irish health system is the sick man of Europe. Meanwhile, Finland is making gains in education by getting rid of homework and treating teachers with better respect.

What are the other best practices that we can take from the rest of Europe and apply here?

Ireland is an ancient nation, but constitutionally a young country. Despite the injustice meted out by the EU during the financial crisis or the thinly veiled attack on our corporation tax through the €13bn fine levelled at Apple, the Irish are nevertheless pragmatic about all the good that being in the EU represents.

The EU Digital Single Market and the Digital Agenda are all about removing the frictions of doing cross-border e-commerce, getting rid of roaming rates and supporting EU start-ups. But it should also be about best practice.

The European experiment is working and there hasn’t been a war within the borders of the EU since 1945. It is Europe’s diversity that makes it strong. But, let’s face it, bureaucracy and perceived nimbyism, and not just national pride, are some of the real reasons the UK is opting out of the European experiment.

Where the Digital Agenda for Europe could really thrive is if we take the parts that work well and offer them as best practice. Surely that would achieve more and sort out more problems?

Europe will never be one giant homogenous market like the US, but it could learn to be nimble and move fast.

In the digital economy, those who move fast will devour the slow.

Ireland is learning that lesson. If it is lucky, it might not be too late for the Athenry project. But, as usual, as I caution with most Apple product stories, only Apple really knows.

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