Adrian Weckler: 'Eir claims it can deliver National Broadband Plan for under €1bn but it can't and it doesn't want to'
CAN Eir deliver the current National Broadband Plan for under €1bn? No.
Does it want to re-enter the National Broadband Plan? No.
So why is the firm’s chief executive, Carolan Lennon, set to tell an Oireachtas Committee today that it has an alternative plan that could save the taxpayer a lot of money?
Is it a ploy to disrupt the process for its own long term gain? Or is everyone just misunderstanding its intent?
In case you missed it, Lennon is set to tell Irish TDs and Senators that Eir “can build rural fibre infrastructure at a lower cost than is currently envisaged in the plans as outlined at the same levels of quality and service as the 300k", a reference to the rural fibre broadband infrastructure it has almost finished.
There are a few background facts to bear in mind:
1. Eir’s actual draft NBP bid was far, far higher than €1bn. In fact, it was a “multiple” of this new figure, according to government officials. Eir won’t release details of its bid for its own reasons.
2. Eir is also already set to get around €900m of the budget planned for the NBP, which could be as much as €5bn between public funds and the bidder’s own investment. It strains belief that it could come close to a replacement set-up for the whole plan for the same amount of money.
3. Eir has entered a new, aggressive phase of its commercial existence. It is making big bets on replacing its ancient copper wires with fibre in cities. It has admitted that its mobile network lags others and is investing in this, too. It is taking no prisoners. It fired many of its external support agencies within months of the €3bn French takeover. It is moving at a speed that no previous incarnation of Eir has done before. But part of that may also be to play harder with external factors, such as the National Broadband Plan. Looking into the future, it may regard a high-end broadband service for a quarter of the country’s homes as a substantial challenge to its own commercial potential, one way or another.
4. Eir’s alternative appears to be based on a plan to replicate the system it uses to connect 300,000 rural homes. The service levels may not be to the standard of the NBP (which has a high level of service, contractually). It would also use Eir’s own infrastructure, which Eir suggests would somehow be at a discount to the costs faced by the current NBP bidder. It’s worth bearing in mind that Eir left the process primarily because the state wouldn’t countenance the massive rural network being run as part of Eir’s existing setup. (The reason for this objection is that there has been a decade of complaints against Eir’s wholesale operation over sub-standard performance and preferential treatment for its own retail division over other telecom firms.)
5. Politically, the company has some support. Fianna Fail communications spokesman Timmy Dooley appears to take Eir’s assessment at face value, tweeting as much. Dooley has repeatedly called for the National Broadband Plan to be postponed over objections to the current ‘preferred bidder’, Granahan McCourt. He, and one or two others, may now prefer to hand the process back to Eir. But the biggest hurdle to this is that Eir says that it doesn’t want to re-enter any form of the National Broadband Plan.