RINGING THE CHANGES

Adrian Weckler looks to 2018 in tech,

BITCOIN — A YEAR OF STICKING OR TWISTING

At the beginning of 2017, Bitcoin and cryptocurrencies were considered a techworld novelty. At the beginning of 2018, Bitcoin is a story that dominates financial news pages on a weekly basis. That is largely because the virtual asset (which Bitcoin has become, rather than the currency it’s flagged as) increased in value from $1,000 12 months ago to $19,000 in December. Will Bitcoin continue to rise in price this year? Yes, say specialists such as Reuben Godfrey, founder of the Blockchain Association of Ireland. The cryptocurrency will hit $200,000 within the next couple of years, he says, based on the fundamentals of the technology and the underlying purpose that it serves.

Many prominent financial executives disagree, describing Bitcoin as a “scam”, a “fraud” and a “bubble”.

However, what isn’t disputed is the value of the Blockchain technology that Bitcoin is based on. It is considered a success, so much so that institutions such as banks are adopting some of its parts in their own financial systems.

And regardless of naysayers, Bitcoin has opened a wedge in legacy financial circles, with a futures market opened in the US recently. Other markets based on Bitcoin’s movements also look likely to emerge in 2018.

Will other cryptocurrencies, such as Ether, Ripple, Bitcoin Cash or Litecoin fare as well next year?

That is also a considerable question that serious analysts are now starting to pay attention to.

5G MOBILE STARTS TO REAR UP

Towards the end of 2017, standards for 5G were agreed by international consortia of telecoms rule-setters. The coming year should see a lot more talk about what to expect from the next big leap in mobile technology. In Ireland, Vodafone has signalled that it will have something to say about it sometime in January or February. So what can we expect? Speed appears not to be the early defining issue, as 4G is already delivering up to 100Mbs in some parts of Ireland, more than most existing services require. Instead, issues such as ‘latency’ (response times between devices over the network) could be an early focus. Many analysts believe that 5G will primarily be aimed at getting devices to work almost instantaneously with each other across networks. Examples could be civic infrastructure such as traffic lights. Self-driving cars are also cited as a potential beneficiary of 5G connectivity, because communication between autonomous vehicles and street architecture such as traffic lights or other safety equipment could be critical to viability. Those caught in poorly served mobile black spots around the country may query how the country can consider moving on to 5G when large chunks of our geography are still struggling with mediocre 4G, 3G or even 2G signals. Communications Minister Denis Naughten recently indicated that the next mobile licences to come through the Government would have a stipulation that 100pc geographic coverage might be required. “Based on our dispersed population, we need to do it this way,” Naughten told this reporter. ComReg’s current chairman, Gerry Fahy, has received this in a lukewarm fashion. While not denying its possibility, Fahy recently suggested that it might be difficult to fashion a mobile licence in this format, because operators may not take up a licence that obligates them to spend millions on equipment for large, relatively uninhabited territories.

At present, Irish mobile operators’ licences only require them to cover between 70pc and 85pc of the country by population, meaning there is no obligation to extend 3G or 4G services into relatively unpopulated areas of the country or rural roads.

FACEBOOK AND GOOGLE TO BECOME APEX DUBLIN EMPLOYERS WITH NEARLY 10,000 STAFF

Despite a few blips (such as the loss of 150 HP jobs), recent times have seen a steady growth in the number of people employed by tech multinationals in Ireland.

But in Dublin, two companies stand out: Google and Facebook. In 2018, the number of people these web giants employ looks set to approach 10,000.

That’s a significant percentage of all the private sector jobs in the city. But it’s an even bigger chunk of the docklands area.

What does this mean for the neighbourhoods around it?

Will it set house prices and rents soaring even further?

And does it leave a section of the city exposed if one or other of the two giants ever ups and leaves?

While Google now employs close to 6,000, this looks set to rise next year, while Facebook looks likely to see close to 3,000 staff by the end of 2018.

The social networking giant has leased an additional building in Dublin to accommodate its massive growth here.

The new building, in the north docklands East Wall district, will have space for 800 ‘desks’ (meaning people).

The upshot is that there will be few auctioneers, white collar offices, retailers or hostelries that won’t be affected by — or even dependent on — the world’s two biggest web companies’ city presence.

Google and Facebook aren’t alone, of course. There’s Linkedin, Workday, Airbnb and a host of other digital tech employers that range from 500 to 1,000 employees in the centre of Dublin.

We think of the IFSC as a banking zone in Dublin. But look around — digital tech companies are growing a lot faster in the capital.

They may already have overtaken banks in raw employment terms. This sustained boom will continue to put strain on some infrastructural areas.

Ireland doesn’t do residential planning well. Facebook’s new building in East Wall will cause rent hikes in the area, as there aren’t enough houses or apartments to go around.

What about other tech multinationals? ‘Legacy’ firms, such as Microsoft, Dell and IBM, appear to have transitioned to services that help their companies to compete globally.

The head of Dell in Ireland, Aisling Keegan, recently told this newspaper that its “commitment” to Ireland, and the 5,000 people it employs here, “is stronger than ever”.

Does the same apply to Apple, after all of the hullabaloo over tax and planning setbacks with its Athenry data centre?

Despite stalling on the €850m data centre in Galway, senior executives in Cork recently impressed upon this newspaper the reliance and emphasis that they continue to place on Irish operations in the company’s global set-up.

Cork isn’t just a finance operation — it oversees complex logistic and transportation issues that can’t be managed from other locations.

Apple also still physically makes PCs at its facility in Cork, a fact frequently overlooked when talking about its financial arrangements here.

RURAL BROADBAND, SO CLOSE, MAY STILL BE FAR AWAY

Next year was to be the year when the Government’s National Broadband Plan was to finally yield physical connections for some of the 540,000 rural businesses and homes stuck without it. Alas, that now looks increasingly unlikely.

A series of delays and competitive disruptions in the last six months mean that most, if not all, of that 540,000 tranche of rural and regional premises will still be without proper broadband at the start of 2019.

The delay has partially been triggered by the deal that the Government struck with Eir in 2017, reallocating 300,000 homes and businesses from the intervention area to Eir’s private rollout zone. While this is likely to see a rollout of broadband to these 300,000 premises by the end of this year, it leaves the bulk of the unserviced rural broadband premises in a worse-off position because they are in harder-to-connect situations.

This deal with Eir caused one of the three shortlisted companies for the rural broadband tender to back out of the process.

Siro, the joint venture between Vodafone and the ESB, claimed that it was no longer worth its while to compete for the State-subsidised tender contract with the more connectable 300,000 gone from the pot.

That has left two shortlisted players for the tender: Eir and Enet. Less competition could mean a potentially bigger bill for the taxpayer and longer to wait until the process begins, given that

the Government has fewer alternative options if one of the remaining players asks for more time.

As it stands, the Government is telling stakeholders that there will be no “shovels in the ground” before the summer.

As for the tender itself, this may now not be decided until late spring or even later.

Some analysts believe that a joint award between Eir and Enet is likely; politically it may be seen to be tricky to award the entire contract to Eir, which is still blamed in some political circles for underinvestment in Ireland’s core telecoms infrastructure over the last decade.

The National Broadband Plan is not the only game in town for rural high-speed connectivity. Separate commercial buildouts from Siro and Eir in large regional towns have added over 100,000 connections in 2017 and promise to match that tally this year.

A MAJOR TEST FOR COMMERCIALISATION OF THE INTERNET, AS NET NEUTRALITY COMES UNDER STRAIN

The US has just ruled that broadband operators can divide up web services depending on who pays them to do so. Will 2018 see similar temptations enter the Irish and European arena?

This is the net neutrality debate that has been bubbling under in the background.

If Ireland and the EU were to ditch net neutrality, an operator like Eir, Virgin or Sky could do the following. For €20 per month, you’d get access to Facebook, Amazon and YouTube. For €30, you’d get access to those websites and Wikipedia, Twitter, LinkedIn and eBay. For €40, you might also get access to all of those plus Netflix and a number of other services. And for €50 per month, you’d qualify for a special ‘unlimited pass’ to access any website in the world. To some, this sounds like a threat to innovation and fundamental freedom. To others, it might sound benign.

Think about it. If Eir or Virgin said to you that they’d cut your monthly web bill by €10 if you only wanted, say, Facebook, Amazon, Netflix and 10 other common sites you sometimes use, wouldn’t you be tempted? Wouldn’t the same arguments that come up with cable and satellite TV surface here, that ‘you can live perfectly fine without unlimited website access’?

Can’t you hear the justification across radio shows and pub conversations? “I’m doing it as part of a digital detox, while saving money, too — I waste too much time on the internet.” To some, this is insidious — it’s cutting off access to valuable, interesting, innovative, up-and-coming repositories of information and services that can’t currently afford to pay the ransom fees that telecoms firms might demand under the new rules.

European authorities say that the EU will protect net neutrality and won’t allow US-style potential commercialisation. But many say it has already started here. Various mobile operators services in Ireland, for example, now offer unlimited access to web giant services by not counting access against the monthly data limit.

This includes the likes of Facebook and Spotify. So far, no one has stepped in to say that this is a worrying precedent because punters see it as a good deal.

6 PHONE SHOPPING WILL REPLACE COMPUTER SHOPPING

We’ve seen it coming for some time, but it looks like 2018 will usher it in for good: phones are replacing our PCs for online shopping.

That also means phones are set to become the main shopping tool overall.

“There’s been a 70pc increase in mobile shopping in Ireland over the last year,” said David Fitzsimons, chief executive of the retailing industry group, Retail Excellence Ireland.

“The majority of online shopping here is now on mobile phones. There’s been a monumental shift in behaviour patterns.”

Fitzsimons said that even in a booming economy, physical shops are only seeing static levels of business while online tills are soaring.

This chimes with figures from the ‘Black Friday’ sales spree last November, which showed that half of all online purchases made that weekend were from smartphones.

That’s a huge increase on two years ago, when over three-quarters of online shopping was still being done on our traditional personal computers and laptops.

In 2018, we will start to shop on our phones with the same increased regularity that we use social media or messaging services.

Shops know this and are now putting most effort into their phone-friendly eshopping services over their PC-oriented ones.

They also know that most Irish adults now have powerful smartphones with large screens, fast mobile phone web connections and plenty of practice in looking for bargains online.