Tensions abound as broadband scheme enters crucial phase

Tensions abound as broadband scheme enters crucial phase.

 

Recently, the government inadvertently published some internal government documents revealing extra details on the cost and tension behind the National Broadband Plan rollout.

I say ‘inadvertently’ because the Government tried to redact the document but didn’t do it properly – anyone with a cursory knowledge of computers could unmask the black redacted strips.

One key issue revealed in the private memo was that the deal with Eir – to move 300,000 rural home and businesses out of the State’s 850,000-premise rollout intervention zone and into Eir’s own expedited rollout plans – will probably end up costing the State money and hit the rollout schedule, too.

“The department’s own subsidy modelling suggests that the smaller intervention area could lead to an increase in the overall cost of the state intervention,” said the document.

But how can covering an area with 550,000 premises cost more than an area of 850,000 premises?

They’re much harder to hook up, return less revenue and might face bridging tolls from Eir along the way.

“While intuitively it could be expected that a reduced intervention area would result in a lower subsidy, there are a number of factors putting upward pressure on the subsidy,” says the private position paper.

“The first arises because the reduction in the overall network build cost for the reduced intervention area is likely to be less than the reduction in revenues earned across the smaller number of premises. While there will be fewer premises to be connected in the reduced intervention area, these premises are in the more sparsely populated and hard-to-reach areas.

Read the full story here independent.ie