Thursday 22 August 2019

Dooley: Go back to Eir for rural broadband, we'll all save money

With the National Broadband Plan crawling towards a signed contract, Fianna Fáil communications spokesman Timmy Dooley still believes Eir has a strong alternative. He spoke to Adrian Weckler

Rethink: Fianna Fáil’s Timmy Dooley suggests Eir’s plans should be reassessed
Rethink: Fianna Fáil’s Timmy Dooley suggests Eir’s plans should be reassessed
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Adrian Weckler technology editor

Adrian Weckler (AW): Eir came in at the 11th hour with a proposal that it could provide an alternative to the National Broadband Plan for under €1bn. You appear to give that plan a lot of credence, despite Eir's track record. Do you believe the company's proposal is a bona fide one?

Timmy Dooley (TD): I certainly think that it can deliver broadband an awful lot less expensively than what the National Broadband Plan's procurement process is now delivering. It has succeeded in rolling out high-speed broadband to 300,000 rural homes, so I think it has the capacity to do it. And I think it could be done more cheaply.

AW: Wouldn't it be an extraordinary coup for Eir, having divided up the NBP intervention area, to come back and persuade the Government to stall or abandon the plan - which itself has probably become more expensive because of that deal to carve out 300,000 rural homes - in favour of a plan allowing it to get the rest on its own terms? And then also to give the company €1bn of taxpayers' money?

TD: That is a valid question. But if I go back to the base principles of what we are trying to achieve here, it's high-speed broadband as quickly and affordably as possible to 542,000 locations throughout the country.

I felt that the entire process was broken when Eir pulled out. Because with its experience, infrastructure, footprint and scale of business in the country, I could never see how anyone was going to beat it in a procurement process.

It wasn't allowed to factor in certain resources that it had available to it. When you're asking an incumbent to tie one hand and two legs together and to compete with somebody [Granahan McCourt] who's not in the place at all, just for the purpose of saying we're having a fair competition, the only one that ultimately loses out here is the taxpayer.

AW: But what you call red tape here is surely department officials being careful with taxpayers' money, isn't it? Don't they have a duty to make sure that the process is as solid and watertight as possible? Would you really go with a potentially lesser standard from a company that many across the political spectrum still blame for Ireland's broadband problems in the first place, ever since it was privatised in 1999?

TD: Well, the Department [of Communications] gets defensive when I raise questions about Granahan McCourt and whether or not it has the experience, the capacity, the capability, and all that goes with it. The department says that it will only be paid when it has delivered. And that if the company goes away, or disappears and leaves the country, that we get the assets. The same could apply in a relationship with Eir.

The minister and the department should be having a much more involved conversation with Eir about this. With the best will in the world, the department has set about building a gold-plated procurement process for very good reasons.

I don't think the motivation was at all incorrect, particularly because of issues that had happened in the past. There had to be checks and balances. But I think it was overdone.

I would agree that the privatisation of Eir created a problem. And if we knew then what we now know about the development of the internet and all that goes with it, I certainly don't think it would have been privatised.

But I go back to the fundamental point. Why would you want to create a separate service for the 500,000 homes that's any different to the 300,000 that are done?

AW: But would the prospect of giving Eir a new bigger, longer-term monopoly under those conditions not be something you'd worry about?

TD: Why does that matter to the consumer? Eir is a regulated entity. It's not like it would be the Wild West for the 540,000. And you can increase or reduce regulation in line with the rules.

But the bit that's important to me is there's market failure, so you can intervene, and you do intervene.

Robert Watt, who has responsibility on the other side for taxpayers, is saying that this can be done more cheaply.

Setting up this super-structure is going to require a massive amount of unnecessary oversight in my view, because you already have oversight through the regulator.

AW: You're on the Oireachtas Communications Committee investigating the National Broadband Plan. But the Government looks like it has made its decision and will sign the contract with National Broadband Ireland (Granahan McCourt). Will the deliberations of the committee really matter?

TD: They may or they may not. But I am the opposition spokesperson. And I have a responsibility in that role and to the broader public to question and hold the Government to account.

I suppose I'd be happy in two or three years' time if my analysis at this point was wrong; if Granahan McCourt is rolling out broadband at a rate of knots and people are happy with the service and we get it less expensively than what is currently predicted. I'll happily put my hand up and say, 'you know what, I was overly cautious'. But when I saw Siro pulling out, at that stage I said, it's time to look again at this.

And it was pushed back by the Government, which said that it would delay the process. That was 18 months ago and they still haven't signed the contract.

AW: If there was an election in October and you became minister, wouldn't you do a 180-degree turn and run with the current process, in a similar way to how Denis Naughten and then Richard Bruton, both of whom were sceptical about the National Broadband Plan process, got into the ministerial seat?

TD: No, I don't think I would. The Department of Finance is saying that we don't have the €3bn. There are so many other projects around the country that are not funded. We're facing Brexit too.

There is additional cost here that is not funded three, five years out. And this is a long-term project that requires very significant demand and resources.

So it's not there. We could afford the €1bn [that Eir is proposing]. And I can assure you that if I was the minister, in advance of the signing of any contract, I'd be sitting down with Eir.

I'd also be sitting down with the regulator. I think we'd very quickly figure out whether Eir was serious or not. I don't think the Government has done that.

AW: On another topic, do you still intend to pursue a tax on digital advertising through companies like Google and Facebook?

TD: Yes, there's an existential crisis in traditional media. Advertising revenue has shifted to the digital platforms.

AW: How much would the tax be?

TD: I don't know, but it would probably start off small.

AW: So would that apply, for instance, to all advertising revenue booked through Google's or Facebook's Irish accounts?

TD: It would be Irish revenue. I'm conscious that these digital companies are very well-versed in tax management.

I would see it as a levy on the Irish advertising component. It would be revenue that's sourced here; that has traditionally been in our media.

To hear an extended version of this interview, listen in to The Big Tech Show podcast at independent.ie/podcasts or any major podcast platform from Friday at lunchtime

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