Fears for broadband plan as Eir withdraws from bidding

Communications Minister Denis Naughten has played down fears for the future of the national broadband plan after one of the last two companies competing for the contract pulled out of the bidding process.

He said the withdrawal of Eir, leaving only a consortium led by Enet and SSE, could actually speed up the final contract negotiations and the subsequent delivery of high-speed broadband to half a million homes and businesses.

He dismissed concerns Enet would now have the upper hand in negotiations, allowing it to raise the price of the project. He said there was a ‘plan B’ for proceeding without Enet-SSE if the final price quoted was too high.

Eir and Enet-SSE submitted detailed draft proposals in September for the plan to roll out high-speed broadband to every remaining premises in the country.

Both companies were in advanced discussions on their final bids when Eir announced it was pulling out.

The company said that “the risks are too great for its continued participation”. Those risks are “significant commercial issues and complexity within the tender process, together with growing uncertainty on a range of regulatory and pricing issues”.

A third bidder, SIRO, withdrew in September.

Mr Naughten rejected the idea that Enet-SSE now has an unfair advantage. “They are very anxious to deliver on this project because they see it very much as a shop window in securing other similar contracts,” he said.

“I am confident that it isn’t going to cost more. It means that you will actually get it quicker. Now that the procurement team are engaging with one set of negotiators rather than two, it can expedite this and that will ensure that the company, in the short term, can now start negotiating with the contractors so that they can hit the ground running.”

Fianna Fáil communications spokesman Timmy Dooley said he does not believe the tender process could continue. “Some people believe that the Government has complicated the process so much that it has become next to impossible for potential bidders to respond in a commercially viable way.”

ALTO, an industry group representing 10 telecoms companies, said the fact Eir cited commercial and regulatory concerns raised fears for the future of broadband competition in Ireland.

Enet chairman David McCourt said: “Enet has been dedicated to the national broadband plan since the first days of consultation and the fact that we have assembled this world-class consortium reflects our continued commitment.”

The project is meant to be completed by 2021.