Weekly Digest
Weekly Digest Issue No. 446
18-12-2008
by Deirdre McArdle
Mobile driving Irish broadband market | Vodafone Ireland poised to cut jobs | Rollercoaster ride ends on a high for Microsemi | Funding signals major R&D drive | Jobs' Macworld withdrawal sparks fresh Apple woes
Mobile driving Irish broadband market
The latest ComReg report on the communications sector emphasised just how much of an impact mobile broadband is having on the overall broadband market. At the end of September there were 1,125,080 broadband subscriptions in Ireland, representing a 6.7 percent increase on the previous quarter and a penetration rate of 29.5 percent. When you take out the mobile broadband figures, this penetration rate drops to 19.7 percent. Mobile broadband subscriptions numbered 268,705, up 203.9 percent on the same time last year. Take-up of mobile broadband continues to out-pace adoption of any other type of broadband by quite a margin. Between the second and third quarters of this year, mobile broadband take-up jumped by 20.9 percent, compared to a growth rate of 4.4 percent for cable broadband, 3.6 percent for DSL and a drop of 2.1 percent for fixed wireless access. As the broadband market continues to evolve, Eircom's hold on the market continues to dip. At the end of the third quarter Eircom had a 38.7 percent share of the residential broadband market, down from 40 percent in the previous quarter and 43.8 percent in the year-ago quarter. This highlights the increasing competition in the market, something which Communications Minister Eamon Ryan suggests is behind the continuing growth in broadband take-up. While Minister Ryan welcomed the growth in broadband subscriptions in the quarter he admitted "we are not where we want to be on broadband but we are getting there". He said that the National Broadband Scheme, which will be implemented by Three Ireland from 2010, will bring broadband to the areas "currently unserved", and that as soon as that happens focus will be on reducing pricing and increasing speeds. "This is a priority of my ministry," he proclaimed.
Vodafone Ireland posied to cut jobs
In a somewhat unexpected development late last week, Vodafone Ireland announced it was to shed 10 percent of its workforce. The mobile operator is seeking 150 redundancies from its 1,500 employees and hopes to achieve this through a voluntary redundancy programme. In its most recent key performance indicators (KPIs) Vodafone Ireland posted a slight rise in subscriber figures to reach 2.23 million (this includes 94,000 mobile broadband customers). Separately, the operator's DSL and fixed-line phone business added 76,621 customers during the three months to the end of September. Despite subscriber growth, Vodafone is seeing a marked drop in its average revenue per user (ARPU) figure, a sector-wide trend as competition sees operators dropping prices and offering bundles. As for which areas the job cuts are likely to come from, a Vodafone spokesperson told ENN that specific details on the announcement can't be shared because the firm is entering into a month-long consultation period. However, the spokesperson did say that this bout of job cuts is a Vodafone Ireland initiative and is not related to the Vodafone Group's cost-cutting programme. In mid-November Vodafone Group's incoming CEO, Vittorio Colao, said he aimed to cut costs by STG1 billion by 2011. At the time he did not indicate if this cost-cutting programme would involve redundancies.
Rollercoaster ride ends on a high for Microsemi
At a time when semiconductor companies around the world are making cuts and issuing profit warnings, it came as a surprise this week when US chipmaker Microsemi, which has a facility in Ennis, announced it is creating 315 new jobs at its Irish facility. The past few years have been a rollercoaster ride for Microsemi's Irish employees. In 2002 the firm slashed its workforce in Ireland by 30 percent. Then in April 2005 it said it would close its Ennis plant completely as part of a group-wide restructuring; however, in May 2007 the firm reversed that decision and said it would keep the plant open, and create additional jobs. Three years on, Microsemi is currently recruiting, with a plan to add over 300 jobs in Ennis over the next 18 months. The positions will be in manufacturing, sales and technical support. Microsemi CEO James Peterson said the jobs announcement was a reflection of the calibre and talent of its existing workforce in Ennis, as well as its "faith in the standard of recruits available in the Mid-West region". It's not the first bit of good news for tech jobs in the region. In October Async Technologies and Limerick-based Avvio announced plans to invest more than EUR4 million and create over 40 new jobs in the Mid-West, while in July ON Semiconductor in Limerick said it would create 49 high-tech jobs.
Funding signals major R&D drive
Establishing Ireland as a knowledge society is a key priority for the Government, as it strives to encourage large multinationals to set up research and development bases here. Supporting that strategy, Tanaiste and Minister for Enterprise, Trade and Employment Mary Coughlan announced on Wednesday EUR45.7 million worth of Science Foundation Ireland (SFI) funding for three existing Centres for Science, Engineering and Technology (CSETs). The CSET programme was set up to facilitate the creation of "internationally competitive, large-scale research centres that support high-quality collaborations between higher education institutes and industry-based researchers", said Minister Coughlan. The three centres receiving the funding are Alimentary Pharmabiotic Centre, based at University College Cork, which is focusing on research in gastrointestinal health; CRANN, the Centre for Research on Adaptive Nanostructures and Nanodevices, which is hosted by Trinity College Dublin and is working in the area of nanotechnology; and DERI, the Digital Enterprise Research Institute based at NUI Galway, where the team is researching technologies that will underpin the next generation of the web -- the Semantic Web. All three have significant industry partners including GlaxoSmithKline, Hewlett-Packard, Intel, Nortel Networks (Ireland) and Cisco Systems Internetworking (Ireland), which have between them supplemented the SFI investment by EUR14.5 million. "These CSETs have been independently verified as playing an important role in building a world-class research system in Ireland, as well as linking successfully with major multi-national companies and providing an attractor for multinational investment in research in Ireland," said Professor Frank Gannon, director-general of SFI.
Jobs' Macworld withdrawal sparks fresh Apple woes
In an announcement that left industry watchers reeling on Tuesday, Apple said that January's Macworld event would be the last one it participated in. The iPhone maker also announced that Steve Jobs, a staple fixture of Macworld trade shows since 1997, will not take to the stage at January's event to deliver his always eagerly-anticipated keynote speech. For years Jobs has used his Macworld address as a platform to launch new Apple products, such as the iPhone and the MacBook Air. Apple explained its decision, saying in a statement: "It will be Apple's last keynote at the show. Apple has been steadily scaling back on trade shows in recent years." Philip Schiller, Apple's senior vice president for worldwide product marketing, will give the keynote instead of Jobs at the event. The news sparked fresh rumours about Jobs' health, which has been the subject of much speculation since he was diagnosed with pancreatic cancer in 2003. Following the announcement, Apple shares dropped by as much as 5 percent in after-hours trading as investors worried the news was linked to Jobs' health. What's more, all eyes have been on the iPhone maker the past few days with the news that it is finally feeling the effects of the decline in consumer spending, which has already affected many of its rivals. Sales of Macs in US stores last month declined 1 percent from a year ago, while industry-wide PC sales rose 2 percent, according to research firm NPD Group. Steve Baker, an NPD analyst, blamed a 35 percent drop in sales of desktop Macs, while noting growth in Apple's laptops still outpaced rivals. It looks like the coming months could be at bit shaky in the Apple camp.
Look out for ENN's 'Year in Review' articles over the Christmas period, where we analyse the key trends of the year and pick our winners and losers of the IT world for 2008.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 