Thursday, 19 October 2006
Question 3: To ask the Minister for Communications, Marine and Natural Resources the revisions he intends to make to the construction of the second phase of metropolitan area networks to ensure cost effective last mile connections for the end user and a backhaul connection from the MANs to the broader telecommunications network. [33854/06]
The second phase of the metropolitan area networks, MANs, programme will give rise to the construction of open access, high-speed fibre broadband networks in more than 90 towns. Some 22 networks are already under construction and the remaining MANs will commence later this year and early next year. As in phase one of the programme, each network includes a co-location facility situated near Eircom's local exchange. In addition to facilitating last mile connections, the co-location facility allows service providers adequate space to house their equipment.
In designing the second phase networks, the local authorities were asked to identify all businesses in the towns and estimate their likely demands for telecommunications services. This exercise will help to identify the potential end users of each network. Connections to these users are included in the network designs.
Backhaul is available to all the MANs through Eircom's network. Some MANs are also connected to alternative backhaul networks where they are available. My Department is currently exploring options to enhance competitive backhaul connectivity.
The first phase of the programme is not working. It has cost approximately €80 million and its reported annual turnover was cited as €3.5 million in April, a poor return on a State investment by any measure.
From presentations to the relevant committees by the operators of the MANs, it is clear that a different system is needed. According to Mr. Conal Henry, the chief executive officer of E-Net, the operators need to connect directly to the buildings through which the MANs run. I have heard nothing different today. The cost to isolated areas in County Donegal, for example, means there is no effective and competitive backhaul network.
Companies like Smart Telecom are pulling out of the broadband business and Eircom announced 100 new broadband roll-outs today. Why are we spending €170 million to duplicate fibre already in the ground without a return? The Minister must consider taxpayers' interests rather than an ideological commitment to this project. Are we getting value for €170 million and why are we digging up roads to put down fibre optic cables that are already there or in a neighbouring road? Will the Minister change the project before the Committee of Public Accounts examines the matter in a year or two and determines it was a mistake, that we built something based on a positive idea and that it did not work? As the MANs are not working, what will the Minister do differently?
The Deputy has amazed me because he normally examines all sides of a proposition before making statements on it. He sounds like a spokesman for a well known company that has opposed the MANs from day one because they would provide it with competition in various places.
The programme will not pay for itself in one, two or three years. It is a long-term investment, as was the investment in the Atlantic crossing that connected us to international broadband services. The PAC examined the crossing and decided that the investment of €80 million was a good one. It has not repaid the State since it started operating.
The MANs programme does not duplicate fibre in many places. Indeed, the programme is providing fibre to many places that would never have had fibre otherwise. We started the project because there was no roll-out of broadband by the incumbent. Instead of taking the incumbent's route of copper wires, we decided to put in place fibre optic cable, which is the cable of the future. In five to ten years, we will be trying to complete a full fibre optic network. Whether this will be done by the State, the telecommunications companies or a combination is open to debate, but it is the direction we must take if we want the type of broadband roll-out referred to. I am sure the Deputy is anxious to have this done and I urge him to be more careful in his assessment of the programme. It is not meant to have repaid the State by this stage and it will not do so for another ten or 15 years. It is not in direct competition with DSL or copper-based lines. Rather, it is providing a future-proof network.
I am not standing here on behalf of Eircom. I would never have sold Eircom. I would even have bought back Eircom. However, I recognise the reality that Eircom still holds all the cards and that the Minister's attempt to set up an independent network will not make any sense unless one can go the last mile and unless there is a backhaul network. The Minister is doing neither and he has not answered that pertinent question here.
The Minister stated in September that he is now looking at some other new innovative ways, possibly using the private sector, to provide broadband connection. Can he give a brief outline of what they might be?
If I conveyed the impression that I was accusing Deputy Ryan of being a spokesman for Eircom, I am not and I accept his bona fides in that regard. I also accept that MANs Phase I is not perfect and will not be perfect, and the issue of backhaul must be addressed. The issue of the fibre to the kerb must be addressed also. If Deputy Ryan was focusing on those particular issues, I do not have a significant difficulty with that but the MANs project will not be, as he described it, a waste of taxpayers' money. I accept that there are issues with MANs which need to be addressed and they are being addressed.