High prices and poor competition have limited the access to broadband in Cork, according to a new report. It predicts that increased availability will boost demand for high-speed internet service from businesses in the Republic's second-biggest city. Barry O'Halloran reports.

The Minister for Communications, Marine and Natural Resources, Mr Ahern, yesterday switched on a 60km broadband network running through Cork city. The €12 million development is the first of the high-speed metropolitan networks the Government is planning to roll out at 19 centres around the State. The €65 million cost of the networks is being met through the National Development Plan and EU regional development funding.

At the same time, Mr Ahern launched a Cork Corporation-commissioned report from PA Consulting, The Cork Information Technology and Telecommunications Study. It predicts that the availability of the new network, allied to falling prices, will lead to a doubling of demand for broadband from businesses in the city over the next year.

According to a spokesman for Cork Corporation, the study states that, in comparison to five other similar European centres, Cork performed strongly in terms of internet penetration and Government agency promotion of information technology.

However, in terms of broadband, PA Consulting says that, in common with the rest of the State, the rate of take-up in Cork has been very low. The firm's report warns that the Irish broadband market is two to three years behind the rest of Europe.

The technology has been available here since April 2002. The report states that, during the 12 months after that date, broadband prices were high. It blames this on the fact that there was only one provider with little real competition from alternative providers and structures.

Speaking after the launch of the Cork network, Mr Ahern said that recent price cuts had boosted the number of digital subscriber line (DSL) broadband users to 32,000. He added that the latest figures also show that 50,000 people have availed of flat-rate internet access, which became available here last year.

Mr Ahern said that the Government would establish a management services entity in the coming weeks to operate the country's 19 metropolitan area networks (MAN). The ESB and Esat BT are also developing the broadband networks, while Eircom is committed to extending its existing network. Smart Telecom has signed up as the Cork MAN's first customer.