Eircom will apply for Government funding this month to support a project to roll out fibre optic and digital subscriber line (DSL) technologies in the regions. The project represents a major U-turn for the firm, which in February pulled out of a similar €37 million (£29 million) State-backed scheme.
Eircom is seeking funding to deploy DSL technologies, which would enable people to connect to the internet at speeds up to 30 times faster than dial-up modems. It also wants to establish several internet protocol points of presence in the regions to enable it to offer telecoms and internet services to large businesses.
It will target a number of towns in the Border, midlands and western regions, which have been highlighted as priority centres for industrial development. The application for funding will be made to secure structural funds for the development of regional e-commerce and communications infrastructure.
More than €35 million is available under two separate National Development Plan programmes: commercial broadband roll-out and commercial DSL roll-out.
If successful, Eircom would have to supply 60 per cent of the funding for the project while the State would offer 40 per cent.
The deadline for inquiries about the funding call is today and the final closing date for applications is October 19th.
Sources close to the company confirmed yesterday that it would submit an application by the deadline. However, it is understood the scale of the project and the details will have to be approved at a meeting of the Eircom board or a subcommittee.
The project marks a significant reversal in policy for Eircom. In February, it withdrew from a similar State-backed project to develop DSL technologies in the regions worth €37 million. The firm pulled out of the project during a period of retrenchment, which saw the company shed more than 200 jobs from its multimedia department.
At the time, it also wrote off its investment in several Irish-based technology firms including Viasec, Nua and Ebeon.
However, in recent months Eircom has begun to invest in new technologies again and last month opened a state-of-the-art internet data centre in Dublin. In a recent interview with The Irish Times, Mr Alfie Kane, Eircom chief executive, said the concept of a State-backed DSL plan was not dead. He also confirmed the company was in talks with the Government about an alternative project.
"It's quite likely we wouldn't do the same project but look at a similar project in a different way," he said. "Neither the Government nor ourselves have any desire just to walk away and do nothing but both Government and ourselves need to think pragmatically.
"We must get value for money, we must do things that really move Ireland towards the idea and vision of Ireland as an e-commerce hub."
It remains unclear whether Eircom will face much competition for National Development Plan funding. The downturn in telecoms has already severely reduced the number of telecoms firms operating in the Republic.
A successful Eircom project may impact on a third element within this part of the National Development Plan. Last week, The Irish Times revealed that several local and regional authorities would submit their own applications for funding under the plan to roll out telecoms networks.
Some €20 million in funding is available to these bodies but the Government had indicated that it may offer additional funding if it were not taken up by the private sector. A successful application from Eircom may reduce the amount of money available for these types of projects.
