Written answers

Tuesday, 6 December 2016

Department of Communications, Energy and Natural Resources

National Broadband Plan

Photo of Michael FitzmauriceMichael Fitzmaurice (Roscommon-Galway, Independent)
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435. To ask the Minister for Communications, Energy and Natural Resources the estimated costs which will be incurred for utilising the existing infrastructure of national networks to roll out fibre to the home; the source of funding for any costs associated with upgrading this infrastructure to enable fibre to the home; and if he will make a statement on the matter. [38684/16]

Photo of Denis NaughtenDenis Naughten (Roscommon-Galway, Independent)
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The National Broadband Plan (NBP) represents a very significant capital investment project for the State and aims to deliver high speed services to every city, town, village and individual premises in Ireland. The Programme for Government commits to the delivery of the NBP as a matter of priority. On 5 July the Government selected the Commercial Stimulus Model as the optimum ownership model for the network that will be part-funded by the Exchequer. The Department has completed detailed costings, down to every individual premise in the Intervention Area and, on that basis, has modelled the likely cost of various technologies and ownership models. It would not be appropriate to publish the expected cost of building the network or the likely cost to the State while a major public procurement process is underway. I do not intend therefore to indicate the overall estimated Exchequer funding parameters. Ultimately, the costs will depend on the price that bidder(s) quote in the tender process.

On 29 September 2015, the Government's 6 year Capital Plan, Building on Recovery, was published. It includes an allocation of €275m for the National Broadband Plan (NBP). This allocation provides the initial stimulus required to deliver the Government's intervention and it is expected that further funding will be available over the lifetime of any contract(s).

The Department commenced the Invitation to Participate in Dialogue (ITPD) phase of the procurement process in July and is engaged in the formal dialogue process with the three qualifying bidders. Following the conclusion of the Dialogue Phase and an invitation to bidders to submit detailed draft proposals, the Department will issue final tender documentation to bidders. When final tenders have been submitted a winning bidder(s) will be selected for the contract which will comprise one or two lots as set out in the NBP Intervention Strategy.

The timing of each stage of the procurement is dependent on a number of factors including the number of qualified bidders and the complexities that may be encountered during the procurement process. It must be noted that bidders will need adequate time to prepare detailed proposals and their final formal bids and get the relevant shareholder and funding approvals at these stages of the process.

In preparation for the procurement stage of the process my Department investigated how different technical solutions could be used to deliver high speed broadband. In line with EU State Aid rules, the process must be "technology neutral" and it is not therefore possible to specify what technology should be used to build the network. Notwithstanding, the three bidders in the procurement process have indicated that they are proposing a predominantly fibre-to-the-home solution under the State Intervention. In cases where fibre is not viable, the bidders might opt for alternative technologies.

In the meantime, my Department continues to liaise closely with industry and relevant other Departments and agencies to remove barriers to assist in the commercial deployment of telecommunications networks. The commercial telecommunications sector has invested over €2.5bn to support the provision of high speed broadband and mobile telecoms services.

I have also secured €8m for RTE which will allow it free up the 700MHz spectrum band, to provide enhanced mobile services.

These initiatives should assist in significantly improving the quality of broadband and mobile phone services across Ireland, putting Ireland to the forefront internationally in terms of connectivity.

Photo of Michael FitzmauriceMichael Fitzmaurice (Roscommon-Galway, Independent)
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437. To ask the Minister for Communications, Energy and Natural Resources the reason his Department did not issue a policy directive under sections 12 and 13 of the Broadcasting Act 2009; his views on whether the failure by his Department to issue a directive since 2003 has impeded investment and the roll-out of competitive alternative high speed next generation access, NGA, services in the past three years; his further views on whether this lack of direction by his Department could be considered a breach of the State’s obligation to promote competition in the provision of NGA services under the State aid guidelines governing the national broadband plan, NBP, intervention and the impact of this on the NBP; and if he will make a statement on the matter. [38686/16]

Photo of Michael FitzmauriceMichael Fitzmaurice (Roscommon-Galway, Independent)
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438. To ask the Minister for Communications, Energy and Natural Resources his views on whether ComReg, which is obliged to implement Government policy directives issued to them by him in regulating the market, are doing so in the absence of a current directive on the national broadband plan, NBP, and are relying on an expired 2003 directive; his further views on whether the current award process is in line with the NBP and the State’s obligations to protect and promote competition in the market for next generation access services; and if he will make a statement on the matter. [38687/16]

Photo of Denis NaughtenDenis Naughten (Roscommon-Galway, Independent)
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I propose to take Questions Nos. 437 and 438 together.

The provision of telecommunications services, including Next Generation Access Services, is undertaken by telecommunications service providers operating in a fully liberalised market under licences provided by the Commission for Communications Regulation (ComReg). The regulation of telecommunications operators is the statutory responsibility of the ComReg, which is independent in its functions.

Both policy and regulation have contributed substantially to the roll out of high speed broadband networks in the last number of years. ComReg's NGA decisions in 2013 created the framework to drive accelerated investment in high speed broadband, which is now available to approximately 1.4m premises in Ireland. ComReg's multiband spectrum auction in 2012, has also allowed the extensive roll-out of 4G networks with at least one operator now having in excess of 90% population coverage. From a policy perspective the National Broadband Plan is also driving investment, and legislation passed by the Houses of the Oireachtas to allow ESB to use its network to deliver high speed broadband services, has resulted in fibre-to-the-home services being rolled out currently in 17 regional towns.

In October, I signed Regulations which will allow ComReg to auction spectrum in the 3.6GHz band (Wireless telegraphy (3.6GHz Band Licences) Regulations, 2016 (S.I.  532 of 2016)). The liberalisation of this band is an EU requirement and the adoption of the 3.6 GHz EC Decision is mandatory for all EU Member States, including Ireland. This Decision is service-neutral, technology-neutral and expressly obliges Member States to allow the use of the entire 3.6GHz band fixed and mobile services. The release of spectrum in this band will provide an 86% increase in total spectrum available for mobile and/or fixed wireless services, leading to better quality voice and data services to customers across Ireland.

ComReg is independent in its functions and I have no role in the process for allocating the spectrum which is now underway. Having regard to the independence of ComReg in the matter and the fact that a process is underway, it would not be appropriate for me to comment further on the matter at this time. I would note however that the allocation process followed extensive public consultation by ComReg over almost a two year period. I have no reason to believe that the process being currently undertaken by ComReg will not result in the fair allocation of any future spectrum assignment and I expect the outcome of the process to provide a level of certainty and transparency for all stakeholders. A policy direction is neither necessary nor appropriate in the circumstances.

Investment decisions by the commercial telecommunications networks providers in the electronic communications market, including investment decisions on the roll-out of Next Generation Access (NGA) are taken purely on commercial grounds by each network operator, having regard to the predicted investment cost and the anticipated revenue returns from any such investment. The State can only intervene in this market in cases of clear market failure. In this regard the National Broadband Plan aims to bring competitively priced quality services to rural areas, through a State intervention to build a new high speed broadband network. It is envisaged that this network will offer wholesale services to multiple retailers, who can in turn offer competitive, affordable and high speed broadband to users.

The Plan aims to deliver high speed services to every city, town, village and individual premises in Ireland. The Programme for Government commits to the delivery of the NBP as a matter of priority.  This is being achieved through private investment by commercial telecommunications companies and through a State intervention in areas where commercial investment has not been fully demonstrated.

The Department is now in a formal procurement process to select a company or companies who will roll out a new high speed broadband network in the State Intervention Area comprising over 750,000 premises in Ireland, covering 100,000 km of road network and 96% of the land area of Ireland. The procurement process is technology neutral. All three bidders involved in the competitive dialogue process are proposing a predominantly fibre-to-the–home network solution to connect rural Ireland. Wireless technology may also play a role in part of the overall solution. It is a matter for the bidders in the process to put forward the technologies they believe are most appropriate to meet the NBP objectives.

Accordingly, I do not propose, nor do I see any necessity, to issue any policy direction to ComReg in this regard.

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