The reality is that four years after the telecoms market was deregulated, one incumbent telecoms player still rules the roost and much future progress depends on how much leeway that telecommunications company (telco) is going to give others in freeing up the local loops and last miles that will see the Government’s dream of 5Mbps to every home and business by 2005 realised.
This 5Mbps by 2005 vision was not the misbegotten musing of a government civil servant, but is an actual directive from the European Commission as part of its e-Europe plans.
In meeting such ambitious directives — well in this country’s case at present and certainly ambitious — the Government earlier this year allocated €200m to a National Broadband Strategy under the auspices of the National Development plan that would see high speed metropolitan area networks (MANs), or fibre rings, built around some 67 towns, creating a network of some 56,000 fibre kilometres.
Recent cutbacks by Finance Minister, Charlie McCreevy TD, have put this €200m vision in jeopardy as the Government performs a balancing act between over-generous spending during the past five years and the need for moderation in a world blighted by recession.
In the most recent Book of Estimates, the government department responsible for broadband rollout, the Department of Communications, Marine and Natural Resources, saw its annual estimate for 2003 cut by 9pc to €484.4m, some €46.2m less than expected. For 2003, a department spokesman told Digital Ireland that these cuts would have no impact on the first phase of the project involving 19 principal towns and an investment of some €44m. “We are able to draw down the money required for this phase in the coming year,” he said.
In terms of the remaining 48 towns earmarked, the spokesman claimed that the overall strategy is still in place and that the remaining towns are not an objective until a further two years. “We are still committed to bringing broadband to the regions,” he said. Cynics would suggest that as with most such projects, 19 towns will get the broadband and be trumpeted in the same way as the Ennis Information Age town was, while competing projects will gather dust and be forgotten.
Optimists, however, would suggest that with the telecoms equipment market in the state that it is in, it is a favourable time for the Government to acquire the materials and equipment it needs at knock-down prices. So far, some €10m has been spent by a central procurement body at the Department of Communications on material ranging from fibre and ducting to manholes. “It’s a good time to be installing these networks as the equipment needed has rarely been cheaper,” a spokesman recently commented. A decision is looming on the appointment of a managed services entity (MSE) that will administer the 19-town project.
Despite the apparent willingness to press on, the reality is that digital subscriber line rollout in Ireland has come very late and is occurring at a perilously slow rate. Eircom, the incumbent, began by focusing on Dublin but now delivers its service to Cork, Limerick, Kerry and areas of Galway, Mayo, Sligo and Westmeath. Esat BT is also taking on the regions, while at the same time relying on Eircom to surrender space at local exchanges. One-time consumer broadband champion, NTL, has decided to quit the residential telecoms market. A recent report of the National Competitiveness Council, placed Ireland 15th out of 16 countries in terms of expensive broadband infrastructure.
This situation contrasts harshly with that of South Korea, a country that, like Ireland, prides itself on its prowess at technology and has had to survive alongside the economic sore that was the Japanese economy over the past decade.
In 1999, Public Enterprise Minister, Mary O’Rourke, expounded plans about how Ireland was going to be the e-hub of Europe, a broadband powerhouse that US firms could base themselves in to serve the European market. At the same time, Korea responded to similar aims with a National Information Communication Plan called ‘Cyber Korea 21’ involving stringent efforts and heavy investment.
Today, the entire nation is crisscrossed with a fibre optics network, and over half of its population, some 25 million people, use the internet. An average penetration rate of broadband internet speed of over 1Mbps is reported to be the highest in the world, according to the OECD. The same OECD report placed Ireland 27th in the world. South Korea was also the first country in the world to commercialise 3G services and today some 28 million people access 3G over code division multiple access technology.
Compared with our policy of 19 MANs around Ireland, while so much unused fibre lies dormant along railway lines and looks likely to be left unused, the Korean government established a five-year plan to develop a countrywide high-speed fibre optic network and then continuously amplify it (from several tens of gigabits to several tens of terabit by 2005). This makes our present plans of 5Mbps to every home and business by 2005 seem miniscule, while even today some homes in South Korea currently enjoy broadband speeds of 13Mbps.
The recent fifth annual report from the National Competitiveness Council warned that infrastructural deficits such as telecoms and electricity as well as rising wage costs and escalating prices could fatally affect Ireland’s competitiveness. To counter this disappointing cycle, the council recommended that the Government press on with its 19-town rollout but, in light of the tighter fiscal situation, the development of a single public private partnership should be accelerated to leverage the maximum private sector finance and participation. It also recommended the creation of a specialist broadband planning office to co-ordinate and manage public and private bodies involved in the Regional Broadband Investment Initiative.
The council also called for the transposition into domestic law of the EU framework for telecoms to be accelerated, focusing particularly on the insufficiency of fines for errant telecoms firms, put in place an appeals mechanism and maintain a regulatory oversight of market areas where competition is yet to develop. It also recommended that the Government come up with ways of stimulating the take-up of broadband services at a faster rate than competing countries.
Pictured: St. Patrick’s St., Cork