eUnion boss tells it like it is

10 Apr 2003

Europe plays a vital role in Ireland’s vision for a knowledge-based society and the EU Commissioner for Enterprise and Information Society, Erkki Liikanen (pictured), who was in Dublin this week, gave an insight into its activities and its impact on Ireland.

Liikanen is the architect of Brussels’ eEurope initiative and his main priority is to create an information society for all Europeans. The programme was launched by the European Commission in December 1999, revised as the eEurope 2005 Action Plan and adopted by the European Council on 18 June 2002. This initiative is the DNA for Ireland’s information society – everything from broadband to e-government, from telecom regulation to research and development.

Liikanen admits that Europe has faced difficulties since its adoption of this action plan and he says that member states including Ireland face various challenges. “After a period of fast growth in 1998-2000, the technology sector is currently undergoing a severe adjustment. The challenge for policy makers is to provide an environment that ensures the development of the sector for the benefit of its users. The advent of broadband communications is radically changing the internet and it is essential for investment in Europe to continue if it is not to be left behind.”

In this respect, is the commissioner satisfied with Ireland’s progress on delivering its information society objectives? “In Lisbon in June 2000, the Irish Prime Minister endorsed the strategy to make Europe more dynamic and competitive in a knowledge-based economy. We have faced difficulties since 2000, but so have all other economies in the developed world,” Liikanen says, adding “Europe is well placed to become a centre for e-business and Ireland is well placed to thrive within our competitive and dynamic single market.”

The commissioner believes that the aspirations of Europe and of Ireland depend on the availability of world-class infrastructure and he means broadband. According to the latest broadband penetration survey carried out by Strategy Analytics, Ireland languishes in second last place out of 16 European countries in terms of broadband internet penetration, with a very poor 1.3pc penetration level – 4.8pc less than the European average.

“Ireland may at the moment have a lower deployment of broadband than some other EU countries,” the commissioner says, “but at the same time it might be in the position of deploying more advanced networks such as fibre-optic networks. It can also benefit from the experience of more advanced countries in this area such as Belgium or Canada.”

Liikanen acknowledges that investment in broadband has reduced as a result of the general difficulties currently faced by the telecommunications sector, and as a result, he believes local initiatives are vital. “Local governments may organise public procurement strategies to increase demand at an attractive level for private operators to invest in structural funds that can also be used to increase infrastructure availability in scarcely populated areas to reduce the digital divide.”

The commissioner also believes that Ireland will hold on to its position as the world’s leading software exporter. “I do not see why this situation should change. Even if software selling were to be conducted mainly via online markets in the future, the quality of the skills present in Ireland in the area of software production will sure secure the continued leading position of Ireland in this field.”

Accenture’s latest e-government leadership report published this week found that Ireland’s performance has slipped down from 10th to 11th place, primarily as a result of delay in the implementation of the Public Services Broker. Regarding the target of online public services, the latest New Connections report shows that 57 e-government projects are behind schedule. With all this in mind, does the commissioner believe Ireland will deliver on its e-government 2005 objectives on time and within budget?

“I do not think it is appropriate for the commission to comment on the delivery schedule of individual e-government projects in the member states,” he says. “These are national projects and, consequently, responsibility for them lies solely with the member states’ national administrations.”

Liikanen is, however, eager to point out that in Europe’s latest benchmarking exercise, Ireland was identified positively in many areas. “For example, e-government services to citizens and businesses for returns, job search, public procurement etc., the last eEurope benchmarking report identified Ireland and Sweden as performing best in the provision of these types of e-government services,” he says. “And in the Permits and Licences cluster, Ireland was the only country to score more than double the cluster average (92pc). Again in this benchmarking exercise, Ireland and Sweden were singled out as the countries with many of their e-government services moving to fill transactional status,” he adds.

Regarding the proposed Telecommunications Retention of Data Traffic Bill, Liikanen is adamant that Ireland will have to comply with EU law and questions the bill’s financial consequences on the telecoms industry. Across Europe, similar proposals on the mandatory and systematic retention of traffic data concerning all kinds of telecommunications for a period of four years are also being considered.

“If Ireland decides to adopt legislation on the systematic retention of traffic data on all users, it will have to comply with EU law. Necessity and proportionality are central in this regard. One key question is whether there is a further necessity to introduce general data retention distinctively for law enforcement purposes,” the commissioner says. “From an internal market perspective, member states should avoid a patchwork of diverging national laws and be cautious about the financial consequences of systematic retention on the industry,” he adds.

A Network and Security Agency for member states to boost cyber security and international co-ordination will come into operation next year and the commissioner denies speculation that Ireland’s Digital Hub is being consider as the location of this agency. “No specific location of the agency has been discussed yet – and due to the very nature of the activities of the agency it could be located anywhere in Europe.”

The 2005 eEurope framework builds on the 1998 directive to deregulate all of the EU’s communications markets. Liikanen explains how a balance will be achieved between the harmonisation of communications markets and the recognition of the needs of different states. “The new framework is designed to be flexible in view of differences in market development both in place and time. It is aimed at deregulation but accepts that under the current market circumstances a certain level of regulatory invention is still needed to foster competition.” He later adds, however, that if a proposed national measure was to be found incompatible with community law, the national regulatory authority can be required to withdraw it.

Going back to broadband, Liikanen says that national strategies must be based on competition, which, he says, remains an essential tool to achieve widespread broadband access through accessible prices and consumers’ choices.

“However, when competition is not effective, regulation kicks in,” he says. “Regulation remains a necessary toll to stimulate competition in broadband services in the short to medium term, as long as competition from alternative networks is limited. In the long term, once the market has taken off, effective competition between different networks will occur under competitive market conditions and ex-ante regulatory obligations will be lifted,” he concludes.

The commissioner’s comments will provide interesting food for thought for our e-minister Mary Hanafin TD, not to mention Etain Doyle at the Commission for Communications Regulation.

By Lisa Deeney