Axia, ICOS & IAWS at the Joint Committee

Xian

[This hasn't been posted before but a presentation by Axia, IAWS (Irish Agricultural Wholesale Society) and ICOS (Irish Co-Operative Organisation Society) on June 24 to the Joint Committee for Communications, which contains a lot of interesting info, was posted on the [url= website (256KB rtf doc). Here's an abbreviated version of the text]

Mr. Hansford: The basic value proposition that Axia is putting forward is startling in some respects. The sub-committee will have heard from numerous parties that this is an onerous, expensive and complex task. Axia says, essentially, that a ubiquitous broadband solution that places Ireland in a leadership role within the EU can be found for less money than is being spent at present. This is quite a dramatic claim and we will talk a little about why we make it and how it might apply to Ireland.

IAWS is an ideal partner for us because much of what we will discuss relates to how a broadband solution, which is comprehensive and addresses every location, village, town, school, health care facility and Government office, regardless of where they are located in Ireland, touches in many ways on the areas in which IAWS has its roots, particularly the co-operatives, which are critical to IAWS society. Many of these are in rural areas that do not have adequate broadband services. We believe our solutions will solve these problems.

Alberta supernet is essentially a network that connects all 422 communities in Alberta and within which our solution connects every school, health care facility and government office. This amounts to approximately 5,000 individual locations throughout the province. Once the network to serve government or public agency locations is in place, we are able to use it to meet private needs by piggy-backing on its capabilities.

To give the committee an idea of the power of this from an economic standpoint, the monthly price for 20 megabits of service in Alberta before the supernet was in the region of Canadian $10,000. An equivalent service on supernet available to government is about $700 a month, which equates to €450. This is 20 megabit both ways and allows anybody to connect anywhere in the province.

We have set up points of presence in each of the rural communities. These are places where independent businesses, such as Internet service providers, wireless access providers, telephone companies and cable television companies, can connect their facilities to the Alberta supernet. One issue we found particularly interesting in the IAWS example was that this is the kind of business opportunity that co-operatives might find extremely attractive. They understand local markets, are respected businesses in the local area and know how to provide services on a co-operative basis. We believe many of the co-operatives which make up the IAWS will be interested in taking on the challenge of examining the possibility of developing a business to provide local access in each of the rural communities throughout Ireland.

Alberta's goals for the supernet are consistent with the goals in Ireland, of which I am aware, namely, to eliminate the digital divide between urban and rural locations, avoid business limitations forcing new businesses to locate in exclusively urban areas and allow them to consider more rural settings, to improve the quality of life and participation of all citizens across the economic and social spectrum and to establish Alberta as a first mover advantage. The last point is extremely important because once this network, not just broadband access solutions, is in place, one is able to deploy applications which will save the Government money. A report in a Sunday newspaper was brought to my attention in which it was stated that Ireland loses about €400 million per year through non-electronic payments.

Mr. Eugene Murray (Advisor to Axia & former member of the executive committee of RTE): The documentation that has been provided to the committee includes a map of Ireland's broadband backbone network. It is important that we recognize that there has been significant investment in telecoms infrastructure throughout the country. The solution that is needed involves taking advantage of the significant investment that has taken place and linking up the communities with a proper market structure and a proper process.

Mr. John Tyrrell: As Mr. Hansford said, I am the director general of ICOS and a member of the board of the Irish Agricultural Wholesale Society Limited, which is the representative organisation of agriculture and food co-operatives in Ireland. It is clear that co-operatives have a major interest in improving communications. The co-operatives are interested in developing this means of communication quickly. It is clear that this gives an opportunity for the co-operatives to provide commercial information on a timely basis, so that people can access it.

There is a significant possibility that Irish co-operatives will be able to become involved in such initiatives. The map that has been shown to the committee indicates that the distribution of broadband in rural areas will be a significant issue for the co-operatives. While they have access to the Internet at the moment, speeds are inadequate and improvements are needed.

Mr. Hansford: Our contention is that there can be a solution, particularly for the Government's needs as the enterprise or exemplary customer, for less than it is costing today. Once this network is in place for Government it can be expanded to benefit other users. We are absolutely convinced that if Ireland chooses not to move forward on implementing its vision of new connections or a similar vision in which a public infrastructure supported network is put in place to meet broadband needs and lead innovation, it will end up spending more money over the next five years.

Chairman: MANs was mentioned. I presume Axia will be tendering for the management services entity - MSE. There is unlit fibre in the ground already that needs to be illuminated. Looking at the map, there may already be sufficient fibre. Is it Axia's to try to win that contract, manage the network and let it spread out from there?

Mr. Hansford: We think that the initiative to which the Chairman refers is an excellent first step, but it is not an adequate step to meet the national needs and there are a number of aspects which would have to be examined if we were to provide a more comprehensive solution. Certainly we are interested in and will be pursuing that but it is a slightly different model from what I am describing today - a national solution for a national customer.

Deputy Coveney: Does Mr. Hansford envisage effectively buying up most of the existing infrastructure held in private hands or, alternatively, competing directly side-by-side with another infrastructure?

Mr. Hansford: We do not want to create a new competitor where competition is not working. There is no reason for the Government to intervene in a competitive market which is working. We want to buy assets wherever we can. We have no interest in building. We will build if we have to, but we have no interest in building and it is a last resort for us. We would much rather buy assets from one of the existing owners, whether that is ESB, Bord Gáis, Eircom, Esat, a local cable company or whoever.

Moriarty

Am i reading this right? Axia want to be the MSE for the MAN projects, but furthermore buy up a shedload of unlit fibre around the country to further expand the network under their control? .... Blimey.

/me goes off to have a good read of the full presentation.

nahdoic

[some more interesting points from the 67 page text]

Deputy Eamon Ryan: The roundabouts will not be the problem. The motorway will be the problem. Given the extent of the network Mr. Hansford wants, is there not a difficulty going to existing asset holders like the ESB and Bord Gáis, in that they do not provide a broad enough range of road network to reach all the co-operatives or Government locations Axia wishes to service? We are talking about dealing with existing telcos which will be reluctant to sell any assets to a company they see as a competitor. These telcos get a lot of their existing revenue from Government contracts. Even if it is just Government and co-operative business, that is still a big chunk of their pie. When assets are being purchased in Alberta, is it from existing telcos?

Mr. Hansford: This is an interesting point and the Deputy is absolutely right. When we were in the negotiating phase, we had a public procurement to which there were ten respondents, of which we were one. The others were telephone companies of one sort or another. Prior to the contract, not a single telephone company would admit it would ever sell any assets to us. They said our model would not work because they would refuse to sell any assets to us. We had an incumbent telco in Alberta called Telus, which was formerly owned by the province of Alberta and privatised about six or seven years ago. It said, on the record, that it would never sell its assets. We have just bought $50 million of assets from Telus.

Deputy Eamon Ryan: What technology does your company have that makes it a better manager of the assets than existing telcos?

Mr. Hansford: We are a better, more knowledgeable company, in terms of the leading edge IP technologies. Obviously, the telephone companies are more expert in traditional telephony than we are. Although I am old and have been in that business a long time, most of our staff have only ever dealt with the new IP, digital converged communications arena. Axia is more qualified in that area than the traditional telephony companies.

Deputy Eamon Ryan: In terms of going the last mile from a local co-operative centre, Government office, library or school being accessed by the network in Alberta, is there one technology which is becoming the best mode of making that final leap to the residential or small business provider? Does the "piggybacking" on the network by outside users require regulatory reform from the state regulator to insist on certain access rights to the local network?

Mr. Hansford: No. In Alberta we have a regulatory environment which permits any entrant to come in and use non-licensed frequencies. It has proven that the wireless technologies are very popular in providing that final mile for rural connections. We provide all the connections for schools, hospitals and Government services. In a small community, if there are three schools and a hospital, we connect the schools and the hospital. We then have a point of presence that is open to anybody and wireless service providers are providing ISP services within that. In Canada we did not need regulatory change to do that although it may be necessary in Ireland.

Xian

IAWS invests €2m in Canada's Axia
Irish Independent, Friday March 14 2003

THE IAWS co-op has invested in a broadband technology venture run by the Canadian company Axia NetMedia Corporation. Axia develops and manages high-speed broadband networks. Axia Ireland has been set up to help the Government and the private sector meet their broadband goals. IAWS has invested €2m in the project, in return for a 10pc stake, with an option to increase it to 40pc.

spongebob

There are 2 IAWS, IAWS the Food Conglomerate a la Kerry/Glanbia/Dairygold is 17% owned by the Co-OP , also known as IAWS

M

Xian

Originally posted by Muck
There are 2 IAWS, IAWS the Food Conglomerate a la Kerry/Glanbia/Dairygold is 17% owned by the Co-OP , also known as IAWS

Originally in the Indo
THE IAWS Co-op...

In the interests of clarity, Muck - you're saying the investor is IAWS Group plc and that the Indo (shock! horror!) got the names mixed up - a simple mistake when you're dealing with "IAWS that has a stake in IAWS"

That said, the outcome is the same, with the co-operative group having a stake in the network.

spongebob

no, its probably the co-op , now I'm confused too. I'll ask himself

Xian

...meaning that only two further questions are outstanding:

(thegills will be able to answer the details of this, no doubt)

1.
It's my understanding that it is within the remit of the MSE, over and above managing the MANs, to acquire/requisition and make available on an open-access vendor-neutral basis underused or unlit fibre infrastructure. In this case, and given the fact that the Government retain ownership of the MANs, does it apply to the MSE in this capacity that the fibre it acquires is "owned" by the Government too? Considering the fact that the vast majority of such fibre is state-funded (Western Digital Corridor, numerous Chorus projects) or largely semi-state owned (Aurora, ESB, CIE, RTE), should there be a concern that yet another tranche of state-controlled (to varying degrees) infrastructure be handed over to a private interest, rather than being returned to state control as per the MSE arrangement, or should it be sufficient that the fibre is made available and that two backbone providers would be sufficient in any given market and we should be grateful it's being put to proper use at last?

2.
Axia among bidders for broadband contract
Irish Times, Tuesday Aug 19 2003

A final decision on the [MSE] contract is expected to be made by the Government in September.

Hello? December? Speaking of which, the Joint Committee final report was due in September too. :rolleyes:

vinnyfitz

Now quoted on ISEQ it stated life as a Co-op and is now a multinational with deep links back into the ag sector. I'm amused they still call themselves "the Society" when it suits them.

More history than you could shake a stick at.

thegills

It's my understanding that it is within the remit of the MSE, over and above managing the MANs, to acquire/requisition and make available on an open-access vendor-neutral basis underused or unlit fibre infrastructure

Not too sure about this. They have to come up with a solution for linking all 19 MAN's. In addition for each MAN that doesn't get lit within 12 months of being handed over to the MSE, the MSE has to light the fibre and offer services.

given the fact that the Government retain ownership of the MANs

Not true. The local authority retain ownership of the MAN and they hold it in trust for the Minister for 20 years (I think). In terms of the MSE, the DCMNR will sign an agreement with the MSE and he local authority will sign a 'license' agreement with the DCMNR. (Note: In Galway Esat BT are already using the MAN fibre)

A final decision on the [MSE] contract is expected to be made by the Government in September.

Probably Jan / Feb 04 at this stage. DCMNR keeping cards very close to chest.

thegills

dahamsta

Originally posted by vinnyfitz
More history than you could shake a stick at.

Wonderful chapter title: Launching A Revolution With Butter

bealtine

Well there is IAWS PLC (the food group) and IAWS the coop. Both are seperate entities.
The PLC is part owned by the coop. It should be easy to find out their percentage
stakeholding from the financial statements of IAWS plc...

Afaik it is the coop that is bidding for the MANS project.