Thank you to the organisers of this event, The Sunday Business Post and iQuest, for the opportunity to address you here in the Croke Park Conference Centre this morning.
It’s a good chance to review progress in the telecoms sector over the last year and to look to the future the undoubted changes and challenges we face. The telecoms industry is constantly changing
I congratulate you, on your progress in this dynamic sector. I believe this sector contains the seeds of the knowledge economy. Some commentators will only focus on the negatives. There is undoubtedly still work to be done – there always will be in such a dynamic sector.
I think it is important that we reflect on the significant progress that has been made to date. Recently, we have seen a merged cable sector, new 3G services, and new providers with innovative broadband services and prices.
By the end of last month, there were approximately 320,000 broadband subscribers in Ireland. In fact, the numbers of broadband subscribers has tripled since I set the Government target in late 2004. In the twelve months of 2005, we saw growth of over 100% - that was twice the rate of growth in the EU. The price of broadband is now 20% below the EU average – and it continues to fall. It now costs €20-€30 per month, compared to over €130 in 2002. The speed of broadband continues to improve. One megabit is now the standard basic broadband, but speeds of three and four megabits are widely available. Broadband is currently available to over 75% of the population.
In terms of large corporate customers and foreign direct investment, we have amongst the lowest costs in Europe in terms of international connectivity and private networks and the Government’s open-access MANs ensure that large businesses throughout Ireland can get competitive priced services.
I don’t list these figures to give us all a warm feeling. I’m highlighting the fact that we have made significant progress. We have started a process that will end with Ireland being a leader in the new world that technology is shaping all around us.
Competition will drive this process. To achieve increased competition in the market place, Government has two major instruments- investment and regulation.
With regard to investment we have and are making significant progress. The first phase of Metropolitan Area Networks have been completed. In little over a year since completion, these MANs are already carrying commercial traffic. Their customers are the large businesses that have chosen to locate in regional towns across Ireland as well as the public sector. The MANs will facilitate new entrants, new services, and more competition throughout Ireland.
The second phase of the MANs programme, which was recently endorsed by the European Commission, is underway. The Commission took the view that these carrier-neutral, open-networks will enable all operators to offer high-speed broadband services to businesses and citizens in the towns concerned and that the programme will boost competition and is fully in line with the Commission’s policy to promote broadband in areas which would otherwise miss out.
This investment opens up the possibility of Next Generation services and future-proofed networks throughout the country and will help combat any regional digital divide.
In addition to Government intervention, the market is also intensifying competition. Significant private investment has been made in DSL, wireless broadband, cable and satellite broadband. All of these platforms are experiencing very strong growth. I envisage that all delivery platforms will continue to compete and thrive in the coming years and drive more broadband take-up.
The other arm of the Government’s telecoms policy, regulation has proven to be less muscular. Obviously the appropriate regulatory framework is a significant factor in creating the right environment to foster competition and improve broadband numbers.
Despite the best efforts of the regulator, I am convinced that we haven’t the regulatory framework in place that will allow for the creation of competition in a speedy and timely manner.
Nowhere is this more evident in the area of local loop unbundling. Full local loop unbundling is essential. It increases competition, innovation and choice on the DSL network for consumers. It is also a legal requirement under the EU regulatory framework. Without it Ireland will never reach its potential.
Because of this the Government has given approval to the heads of legislation which gives enhanced powers to ComReg to allow them to enforce regulatory decisions with the aim of improving competition in the sector. I expect to publish this legislation within the next few months.
In the context of the current legislation, I will bring forward proposals to give ComReg concurrent competition law powers in the telecoms sector similar to the UK model. This will allow ComReg to investigate and take action in issues such as abuse of dominance.
It’s not all about regulation. Consumers can play a large role in speeding up broadband rollout. But we must stimulate that demand by clearly communicating the benefits of broadband to everyone. There is enormous scope for quickly expanding this level of take-up.
There are over half a million people who already access the internet today who are not using broadband. It is imperative that this segment of internet users are convinced and incentivised to switch over. It is for this reason that my Department along ComReg will be hosting an event in the Autumn aimed at raising awareness of broadband and some of its practical applications. I look forward to your input and support for that event.
There were other welcome developments in the telecoms sector this year. Many companies in the mobile sector are eliminating cross-border charges, and I would hope that trend continues across more services.
I applaud the foresight shown by these early movers in eliminating these tariffs and hope it leads to stronger more cost effective business relationships across our borders.
The mobile sector also saw significant changes last year with the widespread rollout of the 3G networks. This will have a massive impact on our ability to do business outside of the office. Yet while the changes have been immense, ‘change’ is never finished. As a country positioning itself as a leader in the global knowledge and ICT marketplace we must continue to seek new changes. And there are many new and evolving challenges for both the telecoms industry and the economy as a whole.
- We need to keep Ireland attractive to continue to entice world-leading companies such as Google, Dell and Yahoo to invest here.
- And we need to continue to develop infrastructure that allows our businesses & economy to thrive in a globalised world.
- We need to roll out enabling technologies and skills to those in our education sector, to ensure the long-term future of the knowledge base our economy has been built on.
This Government invested in international connectivity many years ago. It ensures that our industry can compete with the best in the world. That investment and yours over the past few years will continue to attract the Microsoft’s, Google's and eBay's of this world to Ireland.
This Government has not gone for short-term ‘soundbite’ initiatives in the telecoms area. It has gone for responsible long-term investment:
- it has invested in international connectivity to this island;
- it is investing in open-access networks throughout the country; and,
- it is investing in our people for a knowledge-based future.
In this increasingly connected but competitive global economy we should not lose sight of what it takes to stay ahead. I firmly believe we should acknowledge the significant progress made to date. Equally, we also need to accelerate and deepen efforts in key areas where ground needs to be made up. We need to keep up, not just catch up!
ENDS