Mobile technology is solution to rural broadband fiasco

Stalled rollout of fixed broadband permits Ireland to race ahead with 5G

October 11th, 2018: Taoiseach Leo Varadkar asked Denis Naughten to resign as minister for communications after he revealed he had four private dinners with the key bidder in the broadband procurement process. Video: Oireachtas TV

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The Government’s rural broadband project has become a runaway bandwagon. Rural businesses and individuals have lost patience with the interminable wrangling and finger-pointing that has been the main feature of the project. Rightly or wrongly they feel that politicians are less interested in solving the problem of rural broadband than in scoring political and ideological points ahead of a looming general election.

The wisdom of continuing with the project now needs to be re-examined irrespective of whether the independent review to determine whether the integrity of the procurement process has been undermined.

The reasons are developments in technology and changing economic considerations since the project was launched. Not least the low level of take-up in areas where high-speed broadband has been rolled out.

Fixed broadband may have been the most logical solution to Ireland’s rural connectivity deficit back in 2013 or 2014, when 5G – the latest incarnation of mobile technology – was early in its development path, but this is no longer the case. It is now a fully developed international standard, delivering connection speeds of over 1,000Mbps, and rollout plans are well under way internationally.

The delay in rolling out fixed broadband may be a blessing in disguise

5G is now a viable solution that eliminates the need to award a licence to a fixed-line broadband player at all, and is likely to offer both the fastest rollout and least expensive solution for Irish rural broadband users, telecoms operators and the Irish taxpayer.

It’s not that long ago when the fixed telephone line was the centrepiece of any Irish home’s communications capability. Now almost everyone has a mobile phone, and the use of fixed-line phones is on the decline. Fixed broadband is going the same way, with cheaper, faster and more convenient services being made available over mobile networks.

Broadband timeline

Developments in the saga between August 2012 and October 2018 VIEW NOW

Blessing in disguise

The delay in rolling out fixed broadband may be a blessing in disguise, as 5G mobile broadband speeds will soon be delivered to homes in Ireland more cheaply, faster and in a more environmentally friendly way than fixed broadband. For home-based broadband services, it is possible to deploy a mobile router in homes that takes the signal from the air and repeats the signal within the home as a wifi signal.

Comreg has already commenced the process of issuing 5G licences in Ireland, which will allow mobile players like Vodafone and Three to roll out 5G networks, as an upgrade to their existing 3G and 4G networks. Unlike previous generations of mobile networks, 5G brings the capability to match and exceed fixed-line broadband in terms of speed, data throughput and coverage, at lower cost. Fixed broadband may have been plan A for the Government in 2015 when the rural broadband project was launched, but time and technology have moved on, and mobile broadband has caught up.

Typically, the 5G radio spectrum licensing process would be expected to bring in hundreds of millions of euro in spectrum fees for the Government. Usually, the mobile operators will roll out cities first, with rural locations taking a lot longer, and some locations not getting covered at all.

According to the research, the Republic comes in 116th place overall with an average broadband package price of €56.92 a month.
According to the research, the Republic comes in 116th place overall with an average broadband package price of €56.92 a month.

Put the country first this time, rather than the cities. By building it into the licence conditions, Comreg can ensure that operators roll out 5G faster to the areas that currently don’t have high-speed broadband and can penalise mobile operators that don’t extend services to rural locations quickly enough by applying what are known as universal service obligations (USOs) to telecoms operators.

Unlike the licensing process for previous mobile technology generations, Comreg has already committed to ensuring that 5G licences are based on geographic coverage, rather than population coverage. This is an important distinction, because population coverage commitments from mobile operators deliver far less coverage in rural areas than geographic commitments.

Better option

This may depress the licence fees obtained by the Government, but this is surely a better option than having to heavily subsidise a fixed broadband provider. The existing mobile operators have every incentive to accept USO rural broadband licence conditions, as they otherwise risk being left out of the next generation of mobile networks, eventually resulting in their existing networks and entire business becoming obsolete.

The obvious thing for the Government to do now is to scrap the existing rural fixed-broadband procurement process

The mobile operators won’t be enthusiastic about a USO obligation, because it likely serves to lengthen the payback period for their investment in 5G infrastructure. However, these players are in the strongest position to undertake this investment, since they have strong balance sheets from profits derived from previous generations of network investment. Mobile operators will, if USO is built in to their licence conditions, prefer to go along with it, both to protect their existing infrastructure investment, and to avoid the risk of missing out on the next generation of mobile services in Ireland.

This idea is not new, and is an active strategy being employed by other governments to solve the rural broadband problem, across Europe, the UK and the United States.

The obvious thing for the Government to do now is to scrap the existing rural fixed-broadband procurement process and move fast to proceed with the 5G licence process, in a way that prioritises and enforces delivery of rural broadband services.

Ireland has the opportunity to skip a technology generation, putting itself ahead of the world’s most advanced economies by creating a licensing model that enforces 5G rollout in rural areas, ensuring we have high-speed bandwidth nationwide, not just in cities and towns.

Liam Young has a background in the telecommunications and IT industries. He was the founder and chief executive of Conduit, and is currently chairman and chief executive of Errigal Bay Ltd, a seafood firm based in west Donegal

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