ONE OF Ireland's most striking competitiveness weaknesses in the last decade has been the failure, mainly by government but also by eircom, to narrow and close a broadband gap that has opened up with our international trading partners. That gap, a succession of international surveys has shown, is widening. Broadband speeds are far slower in Ireland than elsewhere and usage costs are higher. Broadband subscribers are also fewer, though last year there was a sharp increase, while broadband coverage remains limited in less populated areas.
In an analysis of Ireland's broadband performance last December, Forfás noted how the fastest speed available to business users is four to five times more expensive than in Europe. Sweden's top high-speed connection is not just four times faster than the fastest available in Ireland, but also costs half the price. This provides one measure of the size of the broadband gap.
In the late 1950s low taxation, in the form of zero tax on export profits, was the key industrial incentive offered to attract foreign direct investment, mainly US companies, to locate here. The low tax regime surpassed what other countries offered and laid a firm foundation for the economic success that followed in later decades, culminating in the Celtic Tiger boom. Low taxation was used to offset Ireland's geographical remoteness. In today's globalised world, location now matters less. But that also assumes a country can offset the disadvantage of a peripheral location by the advantage of a world-class telecommunications infrastructure.
Ireland certainly lacks that telecommunications advantage. Just as Ireland's low tax regime has made the country an attractive location for multinational investment, the clear inadequacies of our broadband infrastructure are an obvious disincentive to foreign investment or domestic expansion. The Minister for Enterprise and Employment, however, disputes this.
Ireland has successfully projected an international image as a knowledge economy and information society and has become one of the top three leading exporters of software in the world. But that success may be imperilled if the broadband infrastructure that is necessary to sustain it, is seen as inadequate. Fine Gael used its private members time in the Dáil yesterday to highlight the broadband question. It is correct to place the Government under greater pressure to address this issue with more urgency than it has demonstrated so far.