Net guru happy to fight for his vision

When Barry Flanagan first touted his idea of creating a mass online market for Ireland in 1992, the sound of slamming doors resonated…

When Barry Flanagan first touted his idea of creating a mass online market for Ireland in 1992, the sound of slamming doors resonated in government agencies and banks nationwide.

Pitted against widespread ignorance of online communication and its potential, he persevered, and privately developed a company that became Ireland's first and biggest Internet service provider (ISP), Ireland Online (IOL).

Today, he still smarts from the experience of being stonewalled by influential financiers, but he shrugs it off with a world-weary grin.

Following a strategic marketing agreement in 1995 with PostGem, a subsidiary of An Post, IOL took on the residential business element of PostGem's Internet service. IOL now has about 60 per cent of the dial-up Internet market, and last year posted a £3 million turnover.

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It is still not making profits, but Mr Flanagan insists "there isn't an ISP in the world making money yet".

With a combined staff of 140, PostGem and IOL co-exist, and it remains unclear whether there will be a complete blurring of the lines. Within this framework Mr Flanagan retains the title of creative and technical director, a position laden with potential in the climate of technological change.

It suits Canadian-born Mr Flanagan to be in the driving seat, looking to new markets and new applications. His single-minded approach is something of a hallmark, first manifested when he opted to leave school at 16 following his mother's death.

His father had died in Canada four years earlier and the family had returned to settle in his mother's home county of Donegal.

"I just didn't feel school was teaching me the things I needed to know. What I saw happening in the world didn't fit with what I was being taught. I was absolutely certain the world we would find ourselves in was nothing like our parents' world."

Several years and a sailing and windsurfing business later, Mr Flanagan decided to turn his attentions to something that would profit better in poor weather. Following a period working for his uncle, Barry Flanagan - one of Ireland's most celebrated sculptors - he used his self-taught computer knowledge to establish a host system allowing him to manage the London-based collection from Ireland.

"I realised if I could do this lots of other people could do it, but nothing seemed to be happening in the area. I knew I couldn't explain the concept properly to people unless I could demonstrate a working service."

In 1991, with one 386 PC and two phone lines, Flanagan established Galway Online, a bulletin board system featuring chat services, email and online games. Every night the system transferred the messages to a server based in Scotland. It usually took two days for a message to do a round trip.

Mr Flanagan wanted to expand and improve the service so he started conducting research into global networks. It was then that the Internet came to his attention.

Late in 1991, he heard the National Science Foundation network in the US had lifted its commercial use clauses and immediately he was drawn to the richness of TCP-IP, the protocol on which the Internet operates.

With what he admits to being very patriotic aspirations back then, Mr Flanagan envisaged a mass online service linking all Irish businesses on a global platform.

Unfortunately, the banks and government agencies he approached had no grasp of what he was trying to achieve. Eventually he amassed £150,000 from five private investors and Colm Grealy came on board as sales and marketing manager.

Soon Mr Flanagan and Mr Grealy's evangelical efforts paid off and the shoestring operation quickly developed a national demand. Ireland Online needed constant capital investment, and sought a strategic partner.

Approaches to Telecom Eireann proved futile. "At the time Telecom wasn't interested in the Internet - they were comfortable in their monopoly at that stage and didn't see any reason to help us," Mr Flanagan says.

In 1995, the company gradually achieved nationwide local-call access when it hooked into the network owned by PostGem, a subsidiary of An Post. A year later, PostGem purchased IOL for around £2.5 million, in what is thought to have been a debt clearing exercise.

Now IOL has 1,800 modems in 27 points of presence around Ireland, and this year alone it will spend about £1.6 million on network services.

Mr Flanagan still holds dear his ideal that the Internet is an empowering tool for everyone, but it frustrates him that it is very much in its infancy.

"A lot of what's happening today is a diversion which isn't necessarily sustainable or enriching.

"It's playing with the medium for the medium's sake. The real long-term winners will be individuals that see through the barrage of hype and find ways to improve the human condition."

Because the Internet is now achieving a critical mass, Mr Flanagan predicts huge changes in online activity over the next year. "Ninety-five per cent of what people will be doing online in five years time hasn't been invented yet." He wants IOL to be at the helm in devising some of these new activities.

In particular, the convergence of data and voice communications is opening up a range of possibilities for exploitation. However, Mr Flanagan is keeping his cards close to his chest on how IOL will exploit the technology for its service.

As he is involved in the day-to-day technical running of the business, he tends to get bogged down in housekeeping duties with little time left for service development.

Recently, he was invited to sit in on a meeting of the government-appointed Telecoms Advisory Committee - a future strategy think-tank featuring some of the world's most influential telecommunications' experts. The meeting, which focused on electronic commerce and infrastructure proved an eye-opener for Mr Flanagan.

"I was struck to be in a room so full of grey matter. The quality of input we are getting from Vinton Cerf [the man who devised the TCP-IP protocol on which the Internet is based] and Brian Thompson [vice-chairman of telecommunications company, Qwest Communications] is invaluable.

"The Government's commitment is very genuine, they know enough to know they need very good advice now, and they are willing to listen."

The priorities for Ireland, he believes, are to get infrastructure in place which can ensure high bandwidth intensive capability.

There are also legislative concerns. In particular the revenue issue concerning tax and VAT on goods bought or sold over the Internet. Mr Flanagan believes it is important that Irish laws work in tandem with those of the US as this will heighten our opportunity to offer global trade.

"Ireland's future strategy is very much in the interests of US business. They have to take the single European market seriously, and to trade effectively they will need to establish a base in Europe. There is every reason for the US to have a strong working relationship with Ireland in these circumstances."

He warns, however, of the danger of focusing too strongly on other countries to get inward investment, possibly at the expense of indigenous talent. Those obstacles of the early days still loom large with Mr Flanagan. He will continue to fight the cause of the malnourished idea or innovation because he knows the reward of sticking to an ideal.

"I'm very aware that things don't necessarily work out the way people tell you they will. All I know is this revolution will change every individual's life, and I have the capability to shape that in some way. That is something that will last longer than I will, so it's worth devoting all my time and effort to. I certainly won't give up my visions."

Madeleine Lyons

Madeleine Lyons

Madeleine Lyons is Property Editor of The Irish Times