New fibreoptic network may be installed

Global Crossing, the international data network and transatlantic cablelaying company, may install a high-speed fibreoptic network in Dublin, The Irish Times has learned.

Such a move would place the company in direct competition with existing fibre ring operators including Eircom, Esat and WorldCom and could be expected to drive down high-speed Internet access costs for businesses.

Mr Douglas Molyneux, managing director for Global Crossing Ireland, confirmed at a European press briefing that the company had held informal discussions with the Government regarding a Dublin ring network. Global Crossing is also considering extending fibre to Cork, Galway and Limerick, he said. "It's all about economics - is there a demand for it and do the economics work out. We've talked to the Government and we'll look at anything if it will benefit the country and the company," he said.

Global Crossing was a partner with the Government in a public-private partnership project that provides a direct broadband cable link to the United States and Europe. As part of that deal the Government bought about half of the capacity on the cable, which was resold to Irish carriers at well below market cost. The project was intended to kickstart the laggard Irish broadband market and encourage business to migrate towards e-commerce.

Global Crossing executives said on Wednesday that the company had decided to build out and manage local fibre rings in several markets to connect clients directly to its main international network "backbone". Mr Molyneux said "a range of issues" needed to be considered before Global Crossing would commit to building a Dublin ring. "Obviously [a partnership] worked well on the international connectivity project," he said. "If the Government were backing this in the same way, we could be in business."

However, a Department of Public Enterprise spokesman said that carrier companies needed to decide privately whether to install fibre in Dublin as the Government would be highly unlikely to provide partnership support. Some £150 million (€191 million) in Departmental funding is available, though, to encourage carriers to install broadband connections to rural, remote and island areas and to schools and other public bodies.

Global Crossing also announced yesterday that it has sold its GlobalCenter data warehousing subsidiary to rival and market leader Exodus in a $6.5 billion (€7.4 billion) share deal. It is understood that GlobalCenter is to announce the opening of a 100,000 sq.ft. facility in Clonshaugh, Co Dublin, next week, its sixth and one of its largest in Europe.

Under the deal Global Crossing will hold about 18 per cent of the merged company. It has signed a 10-year network services agreement with Exodus to supply connectivity, and will enter a joint services agreement in the Asian market.

"Before, Global Crossing owned 100 per cent of a small pie and now owns 18 per cent of a very big pie," said Mr Chuck Mancini, senior vice-president and general manager of GlobalCenter Europe. While he said that GlobalCenter had not made a final decision on locating in the Republic, he noted Exodus "has been looking at the Irish market as actively as we have" and "should be very interested in going forward".