National Broadband Plan may face new state aid challenge from Irish operator

The chief executive of a wireless broadband firm will warn the government today that proceeding with state-subsidised broadband for 540,000 rural homes under the National Broadband Plan represents “unnecessary state intervention” and ”could lead to difficulties with state aid approval” in the EU.

Imagine’s Sean Bolger will make the statement in front of the Committee of Public Accounts this morning.

He will do so after this week unveiling plans to rollout wireless broadband to 400,000 of the 540,000 premises on the government’s rural intervention area.

Asked whether he would initiate legal action to enforce his position under EU state aid rules, Mr Bolger declined to rule it out but said that he “didn’t think it will come to that”. He said that the state scheme can be adapted.

“The National Broadband Plan is a necessary thing to bring fibre out there,” he said. “But it’s unnecessary to as a final connection to the home.”

Mr Bolger said that his company plans to invest almost €300m in a new wireless broadband network, to eventually reach over 1m homes across the country.

The existing National Broadband Plan process, he will say, excludes “the benefit of available, alternative lower-cost last-mile solutions” such as his.

As such, it may represent “unnecessary state intervention” and ”could lead to difficulties with state aid approval” in the EU.

“With 5G essential to the future digital society and economy, the current FTTH approach can no longer, of itself, achieve the very objectives of the NBP with the risk of further marginalising regional Ireland and rural communities,” he will say.

Imagine’s new wireless rollout will be based on 325 sites using masts that connect to antennae played on the outside of a home.

The rollout has begun already, Mr Bolger said, with 155 broadband transmission sites to be live by June of this year followed by another 170 sites live by June 2020.

Mr Bolger said that the service would offer a 150Mbs broadband connection for €60 per month and a €150 set-up fee.

However, he said that the service will be initially restricted to between 300 and 400 homes per location, expandable as demand increases.

The new rollout is aimed at non-urban areas and will cover 400,000 of the 540,000 rural homes to be covered by the National Broadband Plan, Bolger said.

Meanwhile, the Department Of Communications is still deciding whether or not to proceed to a ‘preferred bidder’ status with Granahan McCourt, the telecoms consortium which is the only remaining bidder in the government’s National Broadband Plan process.

A decision on this has been waited on for almost four months. Sources close to the process say that it’s still “weeks” away, although there is a possibility of a formal decision by the end of February.

If ‘preferred bidder’ status is conferred upon Granahan McCourt, the government and that company will then move to sign a contract for the 25-year deal. This will see the government commit to subsidising the buildout of a (mostly) fibre broadband network to the ‘intervention area’ of 540,000 homes and businesses in mostly rural areas. At the end of the 25 year period, the company gets to keep the rural network.

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