Weekly Digest
Weekly Digest Issue No. 502
11-02-2010
by Deirdre McArdle
Digital media firms to star in US showcase | E-reader market close to tipping point
Mixed week for tech jobs
It's been a mixed week for Irish jobs. Early in the week medical devices firm Boston Scientific said it would be cutting its Galway workforce by up to 175 positions with the possibility that jobs will also go at its Cork facility. Boston Scientific employs around 5,000 people in Ireland, with 3,000 of those based in Galway. Last June Boston Scientific announced a EUR91 million investment in Galway, creating 45 jobs, followed a month later by a EUR21.7 million investment at its Cork facility. Reports have suggested that between 70 and 190 jobs could go at the firm's Cork facility.
On the plus side, D&B, a provider of business information, announced this week that it plans to establish a business operations centre in Dublin. The move will create up to 100 highly skilled jobs by the middle of next year, and the hub will be responsible for the collection and processing of data on companies. D&B said it will "in-source" operations roles from existing off-shore arrangements, and that many of these roles will be filled in Dublin. Meanwhile, mobile operator Three Ireland is to invest EUR5 million in a retail expansion that will see it open up 28 new stores around the country and create up to 90 new jobs. During 2009 Three said it recorded 40 percent growth in its customer base. The expansion plans reflect the operator's ambition to "further strengthen our position in the Irish market over the next few years," said Robert Finnegan, CEO of Three Ireland. Though not strictly tech sector jobs Three's expansion is nonetheless good news and signals increased competition in the mobile market in Ireland.
ComReg tackles the local loop
The local loop unbundling (LLU) saga developed further this week with the announcement that ComReg had reduced the monthly line rental charge for LLU that Eircom can charge other operators to EUR12.41. The current price for LLU in Ireland is EUR16.43 -- the highest charge in Europe, where the average LLU price is around EUR9.28. In its ruling ComReg said: "the current LLU price has acted as a major barrier to competition in LLU based broadband in Ireland and needs to be amended if ComReg is to fulfil its statutory obligation to promote competition."
Minister for Communications Eamon Ryan called the ComReg decision a "landmark" development, where the combination of "strong policy and collaborative engagement are having positive impact". He said an "affordable, economically viable LLU product is critical to effective and sustainable competition in the electronic communications sector". While the association for alternative operators, ALTO, also welcomed the decision for its "potential for enhancing consumer and business confidence in the communications market", chairperson Ronan Lupton said the move "does not go far enough". The cost of an operator in Ireland to offer enhanced LLU services is still 25 percent more expensive than in the rest of Europe, he said. Broadband provider Magnet Networks was cautious in its reaction. "Magnet welcomes this decision by ComReg. However, we will await to see if Eircom challenge the decision or if it will adopt a new approach of engagement that focuses on progress and not procrastination." On being contacted for a statement Eircom said it was not commenting on the decision at the moment.
Digital media firms to star in US showcase
This week saw 36 Irish technology firms head off on a Enterprise Ireland-led trade mission to New York and Boston. Sectors represented on the mission include software, telecoms, e-learning, life sciences, environmental services and digital media. Ireland's reputation in the digital media sector has been growing of late, not least because of the Irish Oscar-nominated firms Brown Bag Films and Cartoon Saloon. Brown Bag's 'Granny O'Grimm's Sleeping Beauty' was nominated in the Animated Short Film category, while Cartoon Saloon's 'The Secret of Kells' has been shortlisted in the Animated Feature Film category. These two companies, along with 11 other digital media firms will showcase their productions at KidScreen, the annual children's entertainment industry conference. The other companies include, Galway-based Telegael, which is an Emmy Award winner for its production 'Tutenstein'; Boulder Media, which is behind shows such as the Emmy nominated 'Foster's Home for Imaginary Friends'; and CR Entertainment, whose teenage drama series 'Aisling's Diary' has been nominated in Tween/Teens for Best One-Off, Special or TV Movie Category at this week's show.
Digital media is recognised as a real growth area for Ireland. "This event allows us to build the profile of the Irish animation industry at the largest children's animation show in the US and create opportunities for Irish companies to network with existing and potential clients over here. We expect a number of business successes to follow on from the event," said Enterprise Ireland's Director of the Americas Tom Cusack.
What's the Buzz?
Google on Tuesday took definitive steps into the social networking sphere with the launch of Buzz, a Gmail add-on that lets users post status updates, share Picasa photos, YouTube videos and links. Google has also made Buzz available on Android devices and the iPhone. The mobile version includes geo-tagging so users can get posts from people who are in their area. In some ways Buzz is similar to Google Wave, and some industry commentators has suggested it should have been called "Google Wave Lite", with other observers saying Buzz is like a halfway house between Wave and email.
It's too early yet to say just what kind of impact Google Buzz will have on the social networking market. Twitter and Facebook are fairly entrenched in the public consciousness at this stage and while Google is a hugely popular brand, this will be a difficult market for it to conquer. Indeed, just one day after its launch and privacy concerns were raised about Buzz. On launch, the service compiles a list of the Gmail contacts who users most frequently e-mail or chat with. Buzz automatically starts following these people and makes the list public by default, which means that people can see who you are regularly in contact with. This setting can be changed in the Edit Profile section, but observers have criticised Google as this isn't immediately obvious.
E-reader market close to tipping point
There's little doubt that the Apple iPad will shake up the tablet PC market when it launches in March; however, it became clear this week that even though it is yet to launch it has made its presence felt in the e-reader market already. When Apple unveiled the iPad in January, it also gave details of an e-book downloading service called iBookstore. While prices were not announced for the store, Apple did say that it would be allowing publishers to set their own prices. This has had a knock-on effect on e-reader maker Amazon as the six major publishers who have already announced support for the iPad immediately began pushing the electronic retailing giant to allow them to set higher prices on the Kindle.
In fact, Amazon had a high-profile falling out with book publishing giant Macmillan when the publisher insisted on charging between USD12.99 and USD14.99 for e-book versions of its best-sellers and hard cover releases. Amazon temporarily suspended its sales of Macmillan titles for the Kindle e-reader because it sells most of its new releases for USD9.99. This week Macmillan's books are back for sale on Amazon, although neither company will say what sort of accord was reached.
It's a tough call for Amazon and the Kindle. Analysts have suggested that the publisher-led pricing model to be employed by Apple will likely become the industry norm. On the one hand, with e-book prices becoming more expensive Amazon could in theory make more money. On the other hand, its users are likely to have got used to paying just USD9.99 for e-books and may resent any changes to the pricing. No doubt about it, the e-reader/e-book market, which has been quietly simmering away for a while now, is fast approaching boiling point.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 