Scott Taunton interview

What is the pic in your sig about Mark?

Republic's ISP market would be net gain for Scott

Interview: Geoff Percival

Name: Scott Taunton
Age:33
Education: Canberra University
Other details: Left Australia in 1995 and went to Belfast, where he established Direct Net Access (DNA Internet.) UTV bought the company in 2000 and renamed it UTV Internet.

Scott Taunton is something of an apt figurehead for UTVs Internet Service Provider (ISP) operations. He knows the industry, seems to know what consumers really want, he's young and he's dynamic- all things UTV Internet likes to see itself as also.

In fact, the young Australian (he's only 33-years old) is so well thought of at UTVs Belfast headquarters that in addition to heading up UTV Internet he's also Group Business Development Director at the overall group. As of the turn of the year, he also heads up the group's radio division - which includes Lite FM, 96FM in Cork and Limerick's Live 95. UTV also owns a third of a radio station in Liverpool and has a share in Absolute Radio UK, a vehicle established to apply for radio licenses across Britain. And UTV isn't nescessarily finished buying radio stations in the Republic. It's continuing to look at possible targets in the main cities, including Galway.

"There are one or two possible assets that would fit within our strategy that we'll continue to look at, but it'd only happen if we could acquire them at the right price. Up until recently we were prohibited from acquiring radio assets in Northern Ireland, but UK legislation has changed, So, even though we're a long way from moving on anything, we can now consider similar moves in the North and there are one or two which we may take a look at," says Tauton.

Taunton's main interest, however, is the ISP side of things - he is managing director of UTV Internet after all, and best known down here for that, UTV first rolled out its Internet offering in the North in 1995. If you operate as an ISP in Northern Ireland you have the ability to operate on a UK wide basis, where there are around 300 operators competiting. Instead of that option, UTV Internet has opted to get into the Republic's much newer market ('gwan!) just as it is about to grow.

"What we've tried to do with the Internet side of things - like with our media division - is establish ourselves as an all-Ireland Internet proposition and we have been looking at introducing products that can work both in Northern Ireland and the Republic," Taunton remarks.

UTV is ranked fourth, in terms of market share, in the ISP sector north of the border - behind the likes of BT, Freeserve abd AOL. It's the only locally based provider and has built up a good heritage there on the back of that. Down here, its Internet arm is less familiar, but that's changing.

"The flipside of being less known in the Republic as we are in the North is that there isn't the same amount of competition here," Taunton adds.

Indeed, and with consumer dissatisfaction to what little competition there is rising all the time, new blood couldn't be more welcome.

Says Tauton: "Absolutely. Establishing ourselves as a credible player for Internet services in the Republic has been one of the most positive steps we've taken as a business. Eircom pretty much had things to themselves and Esat BT consolidated a lot of the ISPs that would've stood as separate entities (for example, iol) otherwise, so people haven't really had anywhere else to turn to until now.

"In the UK the assumption was always that you had specialist ISPs that weren't telecoms providers. They used the telecoms infrastructure to develop value products for Internet users. In the Republic, because Eircom and Esat were developing the Internet service, there was the assumption that you had to be a telecoms operator in order to be an ISP. The two don't really go hand in hand because part of the problem with developing Internet services like Flat Rate and Broadband is that what you're trying to do - in order to give value to the consumer - is remove the cost of the call side of accessing the Internet. Conversely, if you're a telco, you want to protect the call revenue that you get."

Since its entry into the Republic five years ago (because of poor infrastructure it didn't run services outside of Dublin until midway through 2000), UTV Internet has become something of a consumer champion. It has tradtionally been offering the cheapest broadband rates in the market and is the only player to have so far introduced a flat rate for Internet access nationwide (9.99 per month for 30 hours anytime and 24.95 per month for 180 hours anytime.) That has helped the company in getting its message out to a consumer base who are only used to dealing with telcos when looking for Internet services.

"It's been pretty easy, I must say. The whole environment has welcomed our introduction from the regulator down the the consumers. We've had good feedback both from customers signing up to us and also customers already signed up to our competition saying that they're glad someone else has arrived who can prompt more competitive pricing structures and force other players to maybe reduce their own prices," according to Taunton.

The message does seem to be getting across. More than half of UTV Internet's revenues come from the Republic. Taunton also has a lot to say on what has always been promoted as the thorny issue of Internet services here - broadband. "We were delighted when we got allowance to proceed with our flat rate services. At the time, Eircom was essentially arguing that there was no need for a flat rate service on the basis of broadband now existing. They felt that consumers could go from dial-up services straight to broadband. But the consumer actually needs evolution within their own usage patterns. Once you start using pay-as-you-go services regularly, they get expensive. The speed of accessing the web isn't the only concern to people. They also want to use the Internet without racking up bills for their period spent online. And that's where you really need a flat rate service."

"The likes of Eircom and Esat have gotten away with operating on margins that are well beyond the EU norm because of the lack of competition offering things like flat rates. They tell customers that they're lowering broadband rates only to increase line rental rates at the same time," Taunton adds.

"Those companies actually have the ability - believe it or not - to sell Internet products much cheaper than us because we're having to buy in a lot of infrastructure that they already have. When we started here we were always asked how we could survive by offering prices so much lower than those of the big two operators and it was assumed that we must be making a huge loss by doing so. We've always been a profitable company and our presence in the market here has already led to Eircom lowering its rates. We're not in the business to lose money, but we recognise that there's a possible mix in creating value for the consumer and making money from it."