Broadband Development in Ireland

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Broadband Development in Ireland

• Professor William H. Melody
• Managing Director, LIRNE.NET
• Center for Tele-Information
• Technical University of Denmark
• melody_at_lirne.net, www.lirne.net
• Presentation to
• Joint Oireachtas Committee on Communications,
  Marine
  and Natural Resources
• ICT sub-Committee
• 8 July 2003, Dublin

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Characteristics of 21st Century Economies

• Driven by the services sectors
• Founded on information/communication networks
  Internet e-economy
• Dependent on effective reforms in the telecom
  sector broadband infrastructure
• Strengthening links among local, national,
  regional, internatonal networks and markets

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Stages of Telecom/Information Sector Reform

• Telecom Liberalization (Participation, Univ.
  Access)
• Expanding Network Capacity (Broadband)
• Preparing the Network Foundation for New Services
• Developing New Services Applications Everywhere
• Applying Services Productively in Different
  Sectors
• Telecom Reform Regulation Key Driver for
  Implementing Policy Reforms for the E-economy

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The telecom sector value chain
Equipment Supply
Telecom Infrastructure
Service Development
Competitive Markets
Monopoly/duopoly/oligopoly
Competitive Markets
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Significance of Network Unbundling

• Industry Sectors - Equipment, Operator Networks,
  Services
• Fixed and Mobile
• Basic Network Layers
• Raw Facility Capacity
• Network OSS Management
• Communication Services
• Content

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The Dimensions of Convergence on the Information
Infrastructure
Convergence Sectors

• Drivers of Convergence
• Technology
• Industry-Supply
• Market-Demand
• Policies/Regulation
• Industry Specific
• Convergent

• Applications
• Finance
• Commerce
• Education
• Health
• Publishing
• Manufacturing
• etc.

Computing
Content
Telecom
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Irelands Convergence Contradiction

• The IT Celtic Tiger of Europe EU Leader
• most benefits to the IT sector
• Telecom Reform Broadband Development
• - Slow, EU Follower
• delayed benefits to economy society
• Why?

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Key Elements of Telecom Reform

• Establish an Independent Telecom Regulator -
  Comreg
• Privatise the Incumbent Telecom Operator - eircom
• Introduce Effective Competition to the Incumbent
  Operator
• Minimise Barriers to Participation of New ICT
  Network Services Suppliers

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Irelands Progress in Telecom Reform

• Delayed start (1996) compared to EU (1987), and
  especially the European Leaders
• Difficulties in working through some of the major
  required institutional changes
• Uneven performance slow Internet and broadband
  development but now a leader in mobile (80
  penetration) despite relatively high prices

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Irelands EU Status in Implementing Telecom
Reforms - I

• Independent Regulation established and
  functioning effectively as a member of the
  European Regulators Group
• Full privatisation process for eircom not yet
  complete
• Surplus eircom employment problem not yet solved
• Only limited competition has developed so far

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Irelands EU Status in Implementing Telecom
Reforms - II

• Limited development of wholesale markets for
  network services which restricts opportunities
  for new services development
• Relatively high prices for most network services
  in EU country comparisons
• eircom actively resisting implementation of EU
  and Ireland pro-competitive and pro-participatory
  policies

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Speeding Up Broadband Network Development in
Ireland - I

• Ensure the regulator (Comreg) has the resources
  and support to drive the telecom reform process
  forward
• Facilitate completion of the structural
  adjustments required of eircom in its transition
  from a monopoly protecting existing services to
  the leading player in a competitive market
  developing new services
• Wherever possible, lower the barriers to
  participation in new services development
  applications
• This is especially important as network
  management for new services in a broadband
  environment is migrating to the edges of the
  network in leading countries, i.e., away from
  centralised management by telecom operators

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Speeding Up Broadband Network Development in
Ireland - II

• Build the essential human capital
  support/establish multidisciplinary education,
  training research on ICT issues of supply,
  demand, applications, policy regulation
• Facilitate government institutions becoming
  leading edge users applying international best
  practices
• Enhance awareness and diffusion of best practices
  among SMEs

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Speeding Up Broadband Network Development in
Ireland - III

• Encourage experimentation in the development and
  application of new network services. Successes
  are rarely picked in advance
• Ensure there is sufficient spectrum allocated for
  wireless applications. They are likely to be a
  significant component of future broadband
  networks
• Be careful with direct government subsidies for
  broadband network construction. Experience
  suggests very limited benefits it can create
  uncertainty in capital markets and reduced
  private investments. Steps to stimulate demand
  and promote competitive conditions for supply are
  generally more effective policy paths to follow.

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• LIRNE.NET, www.lirne.net
• A Strategic Collaboration for applied research,
  training, policy and regulation support, relating
  to information infrastructure and new network
  economy development
• Center for Tele-Information (CTI), TU Denmark
• Economics of Infrastructures, TU Delft,
  Netherlands
• LINK Centre, Wits University, South Africa
• Media_at_lse, London School of Economics, UK
• Participate in the the World Dialogue on
  Regulation for Network Economies review and
  comment on the research, www.regulateonline.org
• For more information contact
  Merete Henriksen, WDR
  Coordinator, henriksen_at_lirne.net
  Tel. [phone] Fax [phone]