Dáil debates
Tuesday, 10 February 2009
Other Questions
Telecommunications Services.
4:00 pm
John Deasy (Waterford, Fine Gael)
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Question 81: To ask the Minister for Communications, Energy and Natural Resources if the management contract for the MANs network phase II has been signed; and the return on investment that the State is receiving in financial terms from the MANs II. [4618/09]
Eamon Ryan (Dublin South, Green Party)
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A total of 58 of the 60 phase II MANs, which provide state-of-the-art, fibre, open access networks to 64 towns across the country are now completed. Construction of the Edenderry network will be completed this year while the Kinsale network will be constructed in parallel with planned main drainage works next year.
All completed phase II networks are being managed, maintained and operated on an interim basis by the technical services firm Magnum Opus on behalf of my Department. Magnum Opus will manage the phase II MANs until such time as a management services entity is engaged for the phase II MANs — MSE 2.
The engagement of MSE 2 is currently the subject of a procurement process, which is expected to conclude before the end of March 2009.
The widespread provision of broadband services continues to be a priority for the Government. In that regard my Department has undertaken a variety of initiatives to address the gaps in broadband coverage. Previous initiatives such as the Global Crossing deal, the group broadband scheme, grant aiding ESBT, and MANs phase I, as well as current initiatives such as Project Kelvin, the national broadband scheme and MANs phase II, have all underpinned the pro-competition policies that are now bearing fruit.
Policies built on the cornerstone of competition provide the investment certainty that the electronic communications market needs. Service providers fully understand that Government intervention, by way of funding infrastructure, will only occur where the market has failed to bridge a digital divide.
Such policy and intervention initiatives, including phase II of the MANs programme have helped to facilitate the development of the market to the point where over 60% of Irish households now have a broadband connection. ComReg's quarterly report for Q3 2008 states that 61.1% of those households have a connection in the speed category of 2 -10 mbps. At the end of Q1 2008, 83% of Irish SMEs had a broadband connection. Over 70% of those SMEs, according to ComReg's report, have a connection in the speed category of 2-10 mbps.
It is important to consider the MANs in the context of these market developments. They have provided all service providers with access to local markets and encouraged the roll-out of DSL in the relevant towns. They have assisted the IDA in the attraction of foreign direct investment and, more recently, are being considered by mobile broadband operators who wish to deepen the fibre in their networks to cater for the rapidly increasing demand for bandwidth by mobile users.
While information regarding the revenue generated from the phase II MANs is commercially sensitive and I do not propose to release details of the revenue generated at this time, I do believe that the MANs will play an ever increasing, and crucially important, role in our competitive electronic communications market.
Simon Coveney (Cork South Central, Fine Gael)
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I would appreciate it if the Minister could stick to the question, which is specifically about the metropolitan area networks phase II. We can have the debate on some of the other issues the Minister raised on another day.
My concern here is that in July last the Department chose a preferred bidder to manage MANs phase 11. Some 58 metropolitan area networks under phase II are completed. It has cost the State approximately €80 million to provide that infrastructure. The Minister tells us, because it is convenient for him, that he cannot tell us the revenue he is getting from that €80 million of expenditure on the 58 MANs that are waiting to be lit up and add backbone to the broadband infrastructure across the country.
The reason the vast majority of them are not being used at all is that we do not have an entity managing this infrastructure on behalf of the State. I asked the Minister last November why his Department had not signed a management contract to allow the preferred bidder — or somebody else, I do not mind — to manage that infrastructure on behalf of the State.
MANs phase I is bringing in a great deal of money to the Government in terms of usage. The MANs phase I are being used by all broadband providers in Ireland with the exception of one or two, yet MANs phase II, at a cost of €80 million, is not being used at all. The MANs phase II are not being managed properly because the Minister and his Department are delaying putting a management contract in place. Why is that delay continuing?
Eamon Ryan (Dublin South, Green Party)
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It is very simple. We want to get the right deal for the Irish people. One tries to manage the negotiations or arrangements so that one gets a proper deal.
Simon Coveney (Cork South Central, Fine Gael)
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It was due in July last.
Simon Coveney (Cork South Central, Fine Gael)
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It is eight months late.
Eamon Ryan (Dublin South, Green Party)
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In the arrangements we had in place where we were still completing certain MANs and where the ones that were finished were available through the interim operations, Magnum Opus managed them.
Simon Coveney (Cork South Central, Fine Gael)
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They are not available.
Eamon Ryan (Dublin South, Green Party)
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It was appropriate for us to try to get a best possible deal for the State and for the people in order to open them up. That is what we are doing. In March of this year, as I stated in my reply, I hope to be able to sign off on that if we can get a good deal for the State. Part of the job of Government——
Simon Coveney (Cork South Central, Fine Gael)
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What is the delay?
Eamon Ryan (Dublin South, Green Party)
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——is to work in the taxpayers' interest.
Brendan Howlin (Wexford, Labour)
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Does Deputy Coveney have a supplementary?
Simon Coveney (Cork South Central, Fine Gael)
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Absolutely. The Minister speaks of looking after the taxpayers' interest. We have spent €80 million of taxpayers' money on this infrastructure and it is not being used. This is dark fibre sitting in the ground not being lit up——
Simon Coveney (Cork South Central, Fine Gael)
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——because it is not being managed.
Simon Coveney (Cork South Central, Fine Gael)
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The Minister has not given a satisfactory explanation for the time delay between July last and now. He now states that we will not see it until the end of March because he wants to get a better deal for the taxpayer. The taxpayer is losing by the day because we do not have a satisfactory broadband infrastructure across the country, partly because we have a great many wires and fibre in the ground that are not being used because of delays in the Minister's office.
Maybe he could tell us how many of the 58 MANs phase II under interim management are being used at present. He stated they are available for use and I dispute that. How many of the 58 are being used and why is the Department delaying putting a contract in place for the proper management of this expensive piece of broadband infrastructure?
Eamon Ryan (Dublin South, Green Party)
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This infrastructure will be used effectively because, as I stated in my response, we will see mobile operators and others availing of it. We will not leave it there stranded in the ground.
Simon Coveney (Cork South Central, Fine Gael)
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The Minister has done so for nearly a year.
Eamon Ryan (Dublin South, Green Party)
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No. It is proper for us to get the market arrangements right for that so that we get a good deal for the State. I would prefer to do that and take the time to get it right rather than get a bad deal quickly.
Noel Coonan (Tipperary North, Fine Gael)
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They will be obsolete before then.
Eamon Ryan (Dublin South, Green Party)
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They will not. The reason for this long-term investment is that in the medium term, which is a ten-year horizon, fibre will become increasingly important and we will see a range of services connected to that.
Simon Coveney (Cork South Central, Fine Gael)
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Did he choose a preferred bidder in July last?
Simon Coveney (Cork South Central, Fine Gael)
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Did he choose a preferred bidder in July last?
Eamon Ryan (Dublin South, Green Party)
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One does not negotiate in public. One does not go out and do the business of the State in an open timeframed way.
Simon Coveney (Cork South Central, Fine Gael)
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I am not asking the Minister to do that. I am asking him to negotiate and come to a conclusion.
Eamon Ryan (Dublin South, Green Party)
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One negotiates to get the best deal. I believe we will get that in terms of management of the MANs II. This infrastructure will provide a vital role among a range of different support measures the State is taking to provide broadband across this country.
P J Sheehan (Cork South West, Fine Gael)
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The Minister is dillydallying. Dunmanway does not have the infrastructure.
Eamon Ryan (Dublin South, Green Party)
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I am not dillydallying at all. In the past two years broadband numbers have gone from approximately 0.5 million up to 1.25 million.
Brendan Howlin (Wexford, Labour)
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Minister, I called Question No. 82.
Simon Coveney (Cork South Central, Fine Gael)
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No thanks to the Minister.
Eamon Ryan (Dublin South, Green Party)
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I will quite happily sit on that record.
Noel Coonan (Tipperary North, Fine Gael)
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The Minister will be sitting on the MANs.
Brendan Howlin (Wexford, Labour)
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I take it the Minister proposes to take Questions Nos. 82 and 96 together.
Eamon Ryan (Dublin South, Green Party)
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I beg your pardon, a Leas-Cheann Comhairle.