Noel Harrington (Cork South West, Fine Gael)
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I thank the Leas-Cheann Comhairle for selecting this very topical issue for debate in the Chamber regarding the possibility of inserting a branching unit to Cork on a new tier 1 express cable or broadband cable which it is planned by an investment consortium to lay between the United States and the United Kingdom, and to Europe. In the coming days we have a chance to make a decision on whether the south west region can connect to this tier 1 cable which is significantly important for the future development of the economy not just in Cork but the entire region.

Tier 1 international connectivity in the southern part of the country would present all regional hubs along the Atlantic corridor and the south west region as serious candidate locations for data-centric companies, Internet players and financial services organisations as a European headquarters or back-up location for their presence in other European locations, while at the same time protecting and promoting the competitiveness of indigenous and multinational industry in regional areas.

Much progress has been made to date to advance the prospects of the new tier 1 connector via the Hibernia Atlantic cable which would significantly enhance connectivity, improve latency and reduce telecommunication costs along the Atlantic corridor and the south. To do business on the telecommunications side is far more expensive in the south of the country than in Dublin, for example, or along the Dublin to Derry corridor. That must be addressed.

The Cork Chamber of Commerce and Cork City Council through its director of services in the docklands fully support the project, as does Cork County Council. Connectivity would present a significant opportunity to this country. I am also aware of a second proposal to link Cork and Dublin with France and onwards to Germany and back to the United Kingdom in a European-British-Irish route. The correlation of those two lines could potentially make Cork a significant telecommunications hub for data control or storage. I hope the Minister will be supportive of progressing the two tier 1 connector projects into Cork.

Some of the companies that have been attracted to Cork through the IDA are significant global multinationals that have based their European headquarters in Cork. I refer to Pfizer, Novartis, GlaxoSmithKline, Eli Lily, Schering-Plough, Stryker, Amazon, Centocor and Siemens as well as one of the most significant companies of all, EMC, and the Tyndall National Institute which are all located in Cork. If those two cables are connected then Cork could become the hub of interconnectivity for transatlantic traffic to all of Europe which would greatly enhance the capacity of companies to employ people in the greater Cork area.

There has not been much investment in this area by the State. In one case the company concerned is not looking for any funding from the State but is seeking State support through departmental assistance and significant administrative support. It would provide a competitive business environment in the south-western region, not just nationally where it is suffering but internationally where it is crucial to make progress. We have seen a company such as Dell decide to leave and go elsewhere in Europe without any regard for the communities and people who are left to suffer.

We must become more competitive and improve technology. I recall working in an old telephone exchange on the Beara Peninsula which had only four lines going out. Back then getting a telephone was a big issue. We have come a long way but we are still behind. The proposal to which I have referred is hugely significant.

Pat Rabbitte (Dublin South West, Labour)
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I am pleased to have the opportunity to address the House on the important topic of international communications connectivity. I am also pleased to have the opportunity to highlight some of the factors that must be considered by the Government before any decisions to intervene in commercial markets can be taken.

I am well aware of the Hibernia Atlantic Express project raised by Deputy Harrington. I can inform him that my Department has met with Hibernia Atlantic in recent months. There was a clear understanding that the company was prepared to install a branching unit to allow a subsequent link up. In recent weeks Hibernia has advised that the company would no longer be prepared to discharge the costs involved. I am happy for the Department to engage with Hibernia to ensure that the option for international connectivity is protected if that is possible. I am advised that Hibernia understands the procedures that the Government must comply with, especially in circumstances where there is more than one potential applicant.

I would very much welcome any investment that would lead to improved international connectivity. Indeed, we have seen significant investments by various market players in recent years, all of which have added to our international connectivity capacity. It is important to note that the electronic communications market is, and has been since its liberalisation, a commercial competitive market. Accordingly, the State can only intervene in the market in limited circumstances, for example, where the market is failing to provide services. In such circumstances, the State intervention can only take place following state aid approval from the European Commission and a public tender procurement process.

In addition, any such assistance would have to demonstrate that value for money would occur. Accordingly, proposed projects are required to meet the tests of capital appraisal. Affordability is also a key consideration, particularly in the current acutely difficult fiscal climate. I do, nonetheless, recognise the importance of electronic communications infrastructure to national and regional economic development. As the Deputy indicated, Cork city has a significant presence of electronic communications infrastructure. I understand that there are well-advanced plans to roll out additional backhaul infrastructure and therefore address the issue of making the region even more competitive.

It is the case that a direct connection into Cork would enhance the region's attractiveness for foreign direct investment. However, the international connectivity market is, as already mentioned, a commercial market. Any proposed intervention would have to avoid distorting the market and avoid undermining investments made by other market players. While I would, of course, welcome additional international connectivity to the island from other countries, I understand that the existing network owners have significant capacity available. I am also aware that other consortia are in the process of planning transatlantic connectivity with connections to Ireland. I am grateful to Deputy Harrington for raising this important question.

Noel Harrington (Cork South West, Fine Gael)
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I thank the Minister for his response. It is clear that significant issues are involved. There was a time-sensitive proposal. The underlying reason for raising the issue is for the Department to be proactive in attracting investment and facilitating where possible tier one connectivity to this country. We are an open economy and we need greater investment into tier 1 traffic, in particular for the southern region. I cannot emphasise enough that it costs more for companies in the south to do business in this sphere than it does for any other area of the country. That issue needs to be addressed.

I realise that I have been granted only four minutes to raise this matter. The Minister will appreciate that if I were to send this information through the transatlantic cable, the amount of data transmitted in that time would take 250 years to read out. That is the type of information deficit we have. It is a big potential for Ireland and a great need in the south-west region. I hope the Minister's Department will take that fully into account.

Pat Rabbitte (Dublin South West, Labour)
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I understand the Deputy's argument very well. In recent weeks, I met with the chamber of commerce along with the Minister for Agriculture, Fisheries and Food, Deputy Coveney, and other colleagues on this very subject. Yesterday, I answered a question from Deputy Ciarán Lynch on the same issue. My officials are anxious to engage with the company involved. Unfortunately, when Deputy Harrington talks about the proposal being time-sensitive, the company must appreciate that it cannot re-enter discussions with the Department to say that the previous understanding in respect of its willingness to discharge the cost of the installation of a branching unit has now changed, yet at the same time expect us to decide it in a matter of days. That cannot be done. There are procedures there, more especially where there is a second applicant, which there is. In those circumstances, we must be careful not just about issues like value for money, but also that we comply with the strictures applying to us. Other than that, I am entirely at one with Deputy Harrington.