The head of the Alternative Licensed Telecommunications Operators (ALTO) has poured doubt on Eircom’s assertion yesterday that Ireland is on the fastest growth curve in Europe for broadband take-up. The organisation has urged the national carrier to reduce wholesale prices for operators as it proceeds with its plans for 100pc broadband coverage of Irish towns.
It has been nothing short of a momentous week for broadband connectivity in Ireland. Last Friday, the same day as an Information Society Commission report called for acceleration of broadband connectivity, the Minister for Communications, Marine and Natural Resources Dermot Ahern TD pledged to invest €35m per year between now and 2007 to broadband-enable 88 towns with populations in excess of 1,500 people.
Not to be outdone, national carrier Eircom revealed its own plans to provide 100pc of all towns with broadband connectivity by 2005, two years ahead of the Government’s plan. The former state carrier urged the Government to spend its money instead on towns of less than 1,500 people. Eircom also claimed to have 30,000 broadband customers in Ireland and 50,000 customers using flat-rate internet access. In addition, the company said that broadband penetration was up from 1pc to 2pc of the population in the past three months and claimed that “Ireland has the fastest growth curve in Europe for broadband take-up”.
However, ALTO chairman Iarla Flynn, while welcoming Eircom’s long awaited initiative, said that Ireland is far from being the fastest growing market for broadband penetration in Europe. He added that a definitive statement needs to be made in terms of wholesale prices to alternative carriers who would be hoping to compete in a broadband-positive environment.
“If both the Government’s and Eircom’s plans go ahead, the overlap would actually benefit the consumer, the business and the alternative carriers. However, in terms of broadband, Ireland is coming from a really low base and for Eircom to say we have the fastest market growth is completely missing the point,” he said.
“Ireland needs a five-fold increase to catch up with the best in Europe who are actually at 10pc population penetration. At the present growth rate, the Government has a target to be amongst the best in Europe by March 2005. By that stage Ireland would need a 12pc broadband penetration or some 450,000 broadband lines enabled.
“There is a long way to go for Ireland to catch up. There are discrepancies in what Eircom is saying. Broadband still costs too much. We would urge Eircom to lower wholesale prices and allow other operators to offer broadband services. Whether Eircom will do that or not at this stage is very unclear. There is a role there for Minister Ahern to take action on this front.
“The two investments [Eircom’s and the Government’s] complement each other in terms of fibre rings, colocation facilities and hopefully an end to the last mile problem. However, we do not expect the Government to agree with Eircom’s call to focus only on the sub-1,500 towns. We would hope the Government will continue to roll out its plans as it means that alternative carriers are guaranteed an opportunity to access regional areas.
“Eircom is still in a command position. Broadband throughout Europe is taking off and one day will be as ubiquitous as mobile communications. Eircom’s track record in recent months shows that price decreases do work and have a positive impact on adoption.
“If we want broadband to succeed, we will need Eircom to upgrade its networks and exchanges, reduce wholesale rates and provide people with competition and choice. Fundamentally, the price of broadband right now will have to come down substantially,” Flynn said.
In a speech welcoming Eircom’s initiative, Communications Minister Dermot Ahern TD made no indication of having accepted Eircom’s recommendation to spend Government structural funds on sub-1,500 towns. Instead, he insisted that the Government and Eircom’s plans actually complement each other and that there would be no duplication.
“I want to stress that the measures outlined by Eircom will greatly complement the Governments’ Broadband Action Plan, released on Friday,” he said. “It is important to stress that there will be no infrastructure duplication in the towns which feature in both the Government and Eircom plans. Government investment will be in future-proof fibre and colocation facilities only – DSL relies on older, copper infrastructure.
“We will be constructing Community Broadband Exchanges which will allow all telecoms companies access the Eircom network competitively and easily. We will also be providing easy-access to backhaul fibre and laying strategic future-proof fibre in these towns.”
“Low prices and cross-platform competition is the key to broadband rollout. The Broadband Action Plan is about cutting prices by facilitating competition and cross-platform competition by giving wireless and other broadband providers easy access to fibre and backhaul in towns throughout Ireland.”
“Eircom’s move today should be welcomed by all who share our vision for a broadband enabled Ireland,” the Minister said.
By John Kennedy