BRITISH Telecom and the ESB are negotiating a joint venture which could lay down a £200 million fibre-optic "trunk" essential to the development of the information society.
A long-distance or backbone fibre optic network is one of the infrastructures suggested in the recent report of the Information Society Steering Committee. It would supply a pathway along which huge amounts of digital information could travel.
The steering committee said such an infrastructure was essential if Ireland was to retain it5 competitive position into the next century.
The joint venture would use the extensive ESB communications network to bring the fibre optic trunk to every city and town in Ireland. Existing infrastructures would then bring information from the trunk to end users.
The network could carry the Internet, digital TV channels and other services.
In Bavaria, British Telecom has formed a partnership with BIAG, the parent company of the Bavarian electricity company, Bayernwerk. Three thousand kilometres of fibre optic cable have been laid out in a network using existing pylons.
The Bavarian system will charge for carrying services on its network. It will not sell services over the network.
Spokesmen for the ESB and British Telecom refused to comment on the Irish joint venture. However, it is understood negotiations between the two companies are at an advanced stage in relation to forming the joint venture. The details of the specific projects which the joint venture would get involved in have not been agreed.
The companies have come together to exploit opportunities created by the liberalisation of the telecommunications sector. The first area to be deregulated will be the closed-user networks in the corporate sector, where competition will apply from July.
The entire sector will not be liberalised until the end of the decade.
The ESB has one of the largest telecommunications infrastructures in the State. It handles all of its own internal voice calls, computer transmissions and communications needed for the remote operation of its power systems.
The ESB would be able to contribute its existing network to any Joint venture. British Telecom, for it's part, has extensive expertise in new technology systems, expertise which it has brought to the Bavarian partnership.
A joint venture with the ESB would give British Telecom a very cost-effective way of attacking thee Irish market. There is already competition in the business market, where a number of smaller companies have challenged Telecom Eireann. However, to carry traffic they have to leased lines from Telecom Eireann, and they have complained about the charges involved.
CIE, RTE and the banks, which also have closed-user networks, could compete for the corporate market once the process of liberalisation begins.
