26 Aug 2011Ireland Broadband Overview

Ireland was late to liberalise its telecommunications market and late to introduce broadband services. The slow progress of local loop unbundling (LLU) is a major reason for Ireland’s poor position, with competitors to incumbent operator Eircom providing only 34 per cent of broadband lines. Government efforts to improve LLU and wholesale access, as well as improved coverage and more competitive retail prices have made some impact on the market.

Ireland’s position has been exacerbated by economic woes. Falling GDP since 2008 has been compounded by the financial crisis and recession, with overall telecom market revenue falling significantly in 2009 and further still into 2010. Eircom has been hit particularly hard by the economic turmoil, with its parent company facing bankruptcy in early 2010. The government’s financial predicament has meant that it has had to curtail infrastructure investment. Furthermore, telcos have been finding it hard to invest across the board. Unfavourable conditions, coupled with the reluctance of consumers to spend on anything other than essential services, means that the telecoms sector will be restrained for the next few years at least.

On the upside, Ireland has one of the youngest demographics in Europe, driving uptake along with unprecedented bandwidth demand. This is reflected in Ireland’s mobile market, which has grown at one of the fastest rates in the EU in recent years, and is now on par with the EU average. The country also has an above average level of data revenue as a percentage of total mobile revenue (at about 30 per cent in 2010). Indeed, growth in Ireland’s broadband market has been largely propped up by the mobile broadband sector. Broadband subscribers have seen a 5 per cent year-on-year growth to end 2010, mobile broadband connections increased by about 33 per cent over the same period.