1987-90: Open systems and Star performers
Business computing looked set for radical change in the mid-1980s with the rise of ‘open systems’. These vendor-independent technologies promised new freedoms for IT managers: fewer constraints if they wanted to change system suppliers, a wider range of software and service options and a raft of industry standards that would lower their costs.
Most installations were still tied to specific computer makers and their proprietary technologies. In Ireland the majority belonged to one of two camps. They took they lead from either IBM or Digital Equipment. Open systems promised to reduce these dependencies.
The centrepiece of this movement was the Unix operating system, which came in various editions that were never fully compatible. Established manufacturers and new challengers alike offered Unix in versions with idiosyncrasies that suited their own machines.
Computing professionals with strong technical reputations tended to be Unix advocates. Some of the country’s best known software developers were active in the Irish Unix Users Group. This association offered international networking services to its members and would, in time, introduce the internet to Ireland as well.
The TCP/IP suite of communication protocols advanced in the wake of Unix. Put simply, the Transmission Control Protocol (TCP) was a transport layer that established and managed data connections, while the Internet Protocol (IP) was a network layer that provided addressing, routing and other network-to-network functionality. The purpose of this software was to ensure reliable data transmissions between disparate host computers.
The first implementation of TCP/IP went live in 1983 on the United States Defense Advanced Research Projects Agency’s network. A US computer science research project and the National Science Foundation adopted the suite soon afterwards. By 1987 there was a growing interest in using TCP/IP to establish an ‘electronic mail internet’ across America’s academic and research networks.
As TCP/IP spread, new elements were added to support more types of network activity. Commercial suppliers began to package these functions and launched TCP/IP toolsets. From 1988 onwards a small number of enterprise networks in Ireland used these products to connect Unix machines with other computers. Most came from the Digital camp.
The conventional wisdom in these years was that TCP/IP was just a temporary fix. Computing and telecommunications experts alike argued that true openness would be achieved through a different model: Open Systems Interconnection (OSI). It carried the imprimaturs of the International Organization for Standardization and the International Telecommunication Union. TCP/IP was supposed to wither away as OSI matured.
Anyone who wanted to link computers at different locations in Ireland had to deal with the state-owned telecommunications company, Telecom Eireann, which always considered voice telephony to be its core business. More and more computer-generated traffic flowed onto its networks in the 1980s. By the middle of the decade Telecom offered three options for data transmission: leased lines, a national packet switching service and dial-up modem connections through the public telephone network.
National telecommunications authorities like Telecom Eireann were increasingly subject to European Commission regulations and directives that echoed the open systems philosophy, especially in the emerging market for ‘value added’ network services.
There were clear signs of a latent demand for such services in Ireland. Clusters of partners in the same lines of business were already exchanging data. Travel agents, freight transporters, farmers, insurance providers, pharmacists and librarians had thus discovered the value in network services. Computer user associations were expanding their members’ e-mail systems so that they could send messages across organisational boundaries. Computer hobbyists, most of whom were students, had set up bulletin board systems.
Universities had more complex data communications needs – and more sophisticated strategies – than any of the other special interest groups. The Higher Education Authority Network (HEAnet) was formed in the mid-1980s. It established low-capacity data connections among the country’s campuses and provided a gateway to the Europe-wide EARN research network. Academics soon discovered the benefits of e-mail. HEAnet, indeed, adopted an e-mail addressing format from the US internet as early as 1987.
By international standards, however, computer networking in Ireland was underdeveloped. In 1987 the European Commission introduced its Special Telecommunications Action for Regional development (Star) programme – a technology catch-up campaign for Europe’s ‘less favoured regions’. Ireland would receive €50 million from Star. Some of this money was allocated to improvements in the underlying infrastructure. But the programme also aimed to stimulate demand for ‘advanced telecommunications services’ as the market opened up and to assist more service providers to get off the ground.
Between 1987 and 1991 Star kickstarted information services based on pre-internet technologies like electronic data interchange (EDI) and videotex. It tried to co-ordinate online access to business and tourism information. It expanded the data communications horizons of government departments and state agencies. And it introduced communities outside the major cities to distance working and videoconferencing.
In many cases the tools selected for these projects proved too costly or too clunky for the services to have widespread appeal or long-term viability. But the programme alerted computing professionals and their customers to a growing appetite for online transactions and information access.
Star paved the way for the internet services of the 1990s.
1991: ‘A complete connection can be achieved in a matter of days’
Ireland’s ﬁrst direct connection to the internet went live at Trinity College Dublin in June 1991. University College Dublin accessed the internet just weeks later. These links showed TCP/IP in a new guise. The protocol suite was now able to provide connections to different types of computers in multiple organisations, often located in other countries and continents.
In Trinity’s case, however, the new resource was not merely a perk for academics. The college shared the 19.2 Kbps connection to Amsterdam with a start-up campus company. IEunet planned to sell internet access to external customers in partnership with the Irish Unix Users Group (IUUG). Ireland’s ﬁrst internet service provider (ISP) had arrived.
From the perspective of the IUUG, the internet option was just the latest in a series of communications services that it had introduced for members. All were made possible by the European Unix Network (EUnet). Launched in 1982 as an international, though informal, network that linked thousands of Unix systems, EUnet used Unix-speciﬁc communications software to support store-and-forward e-mail and discussion groups. In 1991 it began to offer internet connections too.
The world’s ﬁrst ISPs had recently surfaced in the United States, where several internet backbones now existed. The dominant one, controlled by the National Science Foundation, could only be used for research or educational purposes. But the other backbones were not subject to this constraint and some were willing to sell their spare capacity. Two commercial services – AlterNet and PSINet – were launched in 1990 to sell internet access in the US.
AlterNet’s owner, UUNET, was the American equivalent of EUnet and had previously run UUCP-based services. EUnet’s network operations centre in Amsterdam followed its lead by introducing the ISP business model to Europe in 1991. EUnet also embarked on a commercialisation strategy, offering internet connections through partner organisations in individual countries. IEunet was one of the ﬁrst.
The campus company’s sales brochure announced the availability of a central node for communication between ‘national and international members’. It also assured potential users that ‘With careful planning and reasonable technical ability a complete connection can be achieved in a matter of days’.
IEunet’s early customers were expected to sign a declaration that they would not exploit the internet for commercial purposes. This requirement originated in an agreement between the company and the IUUG. But it also masked the way that internet services were taking on a commercial character – a shrewd precaution in the days before service providers could apply for ofﬁcial licences.
The internet arrived in Ireland without a fanfare. Some network administrators, academics and Unix enthusiasts were aware of the new initiative. But the majority of online service providers and their customers had other matters on their minds in 1991. The Star projects were now coming to fruition and the start-ups they had fostered were touting for business. A follow-up programme, Telematique, was also getting underway.
One outcome of Star was a battle for transaction processing contracts between two state-owned companies. Eirtrade was part of Telecom Eireann, while PostGem was a subsidiary of the national postal authority. These competitors collaborated with rival supermarket groups to roll out EDI. Both sold e-mail services based on OSI standards. Both targeted trade associations and professional bodies as prospective customers.
In one instance, following government instructions, Eirtrade and PostGem formed a joint venture. Its task was to create a single national network for a customs clearance service. IT industry groups objected, however, that the joint venture would become a new communications monopoly.
The Star-supported initiative with the highest proﬁle was the Minitel videotex system. 1991 was never meant to be the year of the internet. It was supposed to mark the dawn of Minitel in Ireland.
France provided the role model. The country had distinguished itself in the 1980s by establishing a mass medium for online information retrieval. Minitel users with special screenphones could access pages of text and very simple graphics from all sorts of content providers. The most popular application in France was an online version of the telephone directory.
AIB Group, Credit Lyonnais, France Telecom and Telecom Eireann formed a consortium to build an equivalent infrastructure in Ireland. There had been earlier attempts to deliver videotex services in this country, but Minitel’s ecosystem approach was something new. The Irish infrastructure went live in 1991 after three years of feasibility studies and technical trials.
Minitel launched business-to-business services in the spring and promised consumer services in the autumn. It soon became apparent, however, that few information providers in Ireland would commit resources to the ecosystem until they saw a critical mass of users. That never materialised. The videotex scheme succeeded, though, in raising the level of awareness of online services in ﬁnancial institutions, tourism, publishing, manufacturing, distribution and the public service.
The term ‘e-commerce’ did not come into vogue until some years later. But the Minitel project planted seeds for it and the internet industry would reap the harvest.
1992-94: An internet ﬁt for techies
First generation ISPs, such as IEunet, talked up the many capabilities of the TCP/IP infrastructure, including its online discussion groups, ﬁle transfer tools and downloadable software. But the primary reason why customers signed up for internet access was because they wanted electronic mail. In 1995, indeed, an international study reported that less than ten per cent of the worldwide internet community used any service other than e-mail. The proportion in Ireland was probably in line with everywhere else.
Other options existed for sending messages from one computer to another. Telecom Eireann had launched a public e-mail service called Eirmail back in 1985, when it began reselling mailboxes on the international ITT Dialcom system. Later versions of Eirmail were based on the X.400 speciﬁcation from the OSI model. By 1992 Irish users could also access several international X.400 e-mail services.
When the ISPs arrived, non-academic users soon discovered that internet messaging was clearly superior to X.400. The internet addressing scheme was far easier to handle. The mail software for client machines was mostly free and could often be downloaded from a ﬁle server. And the day-to-day costs of sending and receiving messages were much, much lower.
For a time it seemed that OSI and the internet would evolve in parallel. For example, there were initiatives on both fronts to develop user directories for Ireland. The TCD computer science department created and maintained a database of X.400 mail users in the C=IE domain, while a UCD campus company was established to run the IE Domain Registry of internet users.
TCP/IP and OSI carried different cultural and political connotations. The TCP/IP protocols had originated in North America, where IT standards often came out of winner-takes-all contests among big corporations. OSI, on the other hand, was rooted in a European tradition of technical collaboration. Europe’s telecommunications operators, computer makers and information service developers invested heavily in it. The OSI model underpinned Star and Telematique. The European Commission frequently stitched its speciﬁcations into cross-border research programmes and standardisation projects.
The Irish software industry was among the beneﬁciaries. A band of developers, including Baltimore Technologies, Euristix, Isocor, Retix and SSE, accumulated OSI knowledge and experience. Building products based on industry standards was, indeed, a proven success strategy for software companies in Ireland with global ambitions.
From a worldwide perspective, however, the supply of software based on OSI technologies looked painfully slow. Network administrators grew increasingly impatient. Most significantly, it became clear that the academic and research networks, which were usually the innovators in computer connectivity, no longer wished to follow the OSI roadmaps. They were now drawing up plans for a Europe-wide internet backbone instead.
Meanwhile in Ireland more ISPs were setting up shop, including regional service providers in Cork, Limerick, Galway and Sligo. Unlike IEunet, these start-ups did not have roots in academia. Nor were they headed by experienced entrepreneurs. Most of the founders had technical backgrounds and preferred conﬁguring network equipment to writing business plans.
Outﬁts like Ireland On-Line, Internet Eireann and Genesis Project were run on a shoestring, investing just enough money to obtain bandwidth on one of the growing number of telecommunications pipelines out of Ireland and to install a switch for customers to dial into. They also drew on the network administration and support talent that was coming out of the colleges.
In 1992 most of IEunet’s customers were technically adept, but they still needed assistance from the service provider to establish their connections. Over the next couple of years it became much easier to sign up with an ISP. By the middle of the decade this was often a do-it-yourself process.
Other online services were even easier to use. By 1994 Minitel customers no longer needed special terminals and could access Minitel pages from regular PCs. International services like America Online and CompuServe were offering members-only online environments that appealed to people with little or no computing experience. Apple’s short-lived eWorld information service was the ﬁrst of these to open an access node in Ireland.
The data communications infrastructure had even started to feature in political rhetoric. The 1992 Clinton-Gore election campaign in the US included talk of ‘information highways’ and the Bangemann report on ‘Europe and the Global Information Society’ in 1994 set a similar agenda for the European Union. Because of a fuzziness in the terminology, the internet could be construed as the main road for data traffic or merely an access route to some future superhighway. Either way it was a hot topic at international summit meetings.
Irish government departments were slower to embrace the internet than their counterparts elsewhere – a source of constant frustration for the local ISPs. The Department of Finance ran a Central Information Technology Service that actively discouraged other departments from connecting to the internet. Some politicians were prodded online with assistance from the universities. But no government minister acquired an internet e-mail address until 1995.
The mainly-for-techies chapter of the internet story ended with the arrival of the World Wide Web. Internet users in Ireland began to explore it in 1994, when browser performance was still too slow and too erratic for practical purposes. It was obvious, however, that this new medium had tremendous potential. And some of the early enthusiasts were very good at using it to spread information. Middleware developer Iona Technologies – which, like IEunet, had been founded inside TCD in 1991 – was among the ﬁrst companies anywhere to use a web site for product promotion.
It was not long before marketing agencies discovered the web. Once that happened, no one would ever again characterise the internet as a not-for-proﬁt environment.
1995-96: Let’s make some money here
A second generation of internet service providers appeared in Ireland during 1995. In general, these newcomers were better resourced and had much more commercial experience than the early entrants.
Internet Services Ireland (ISI) was backed by Sun’s Irish distributor and targeted businesses and households under separate trading names. So did Medianet, which originated in the advertising industry and aspired to build an online audience for marketeers. Indigo promoted itself as a one-stop-shop for all aspects of internet usage. It was initially controlled by a family-owned ﬁrm whose background was the subject of much speculation among its rivals.
These ISPs lacked the crusading spirit of their predecessors. They were backed by hard-nosed investors. They were motivated by market share. They were determined to make money from the internet.
Meanwhile, the non-internet services fostered by Star and Telematique petered out. Eirtrade quietly took over the remnants of the Minitel system in 1995. The Telecom Eireann subsidiary and PostGem both announced internet access options for their existing customers and started to phase out their OSI-based services. Telecom’s main priority for the internet, though, was still to build its back-end infrastructure rather than to deliver front-end services.
In 1996 the EDI Association of Ireland dropped ‘EDI’ from its name and relaunched itself as the Electronic Commerce Association of Ireland. This reﬂected the gradual reconﬁguring of the information services for banking, insurance, law and the travel trade so that they would run over the internet.
The OSI model itself soon faded away and its protocol wars against TCP/IP were forgotten – except, perhaps, among those software professionals who had chosen OSI as their career strategy. The demise of OSI was detrimental to the Irish software industry as a whole. Some applications development companies, however, soon embraced the internet by adding web capabilities to their products.
Netscape became the global giant in internet software. It brought stability to browser technology and the web rapidly came to dominate the online applications spectrum. The ISPs responded by offering web space and support as part of their customer packages or by partnering with specialist web designers and consultancies. The English language overwhelmed all others on the early web, making it very easy for Irish users to ﬁnd their way around. Newcomers to the online world commonly assumed that the internet and the World Wide Web were the same thing.
By now large enterprises, small ﬁrms and residential users could pick internet service providers that catered for their different wants and expectations. The competition for small businesses and home computer users was particularly intense, focused on aggressive pricing rather than on the quality of service. The ISPs offered ﬂat monthly charges or generous trial periods. They published their own internet connectivity kits with step-by-step signing up instructions for new users and distributed these packs through retail outlets.
These trends became visible to all during the pre-Christmas marketing season in 1995. Electrical appliance shops bundled web browsers with multimedia PCs. Bookstores and video rental shops stacked their shelves with ISP kits. Newspaper advertisements urged non-users to discover the internet and one of the new service providers ran a billboard campaign that started with teaser slogans and only revealed the company’s identity at a later date.
The heightened competition hurt the weaker players. During 1996 Eirenet closed down and Indigo picked up much of Internet Eireann’s customer base following that company’s collapse. The consortium behind ISI bought EUnet Ireland (as IEunet was then known) and merged the companies under the EUnet name. PostGem assumed control of Ireland On-Line later in the year.
In the midst of this all volatility a row over interconnection erupted among the service providers. Local interconnection made economic and operational sense. When the customers of one Irish ISP sent e-mail to the customers of another, their messages were following complicated international routes to reach their destinations. Everyone should beneﬁt if this trafﬁc was switched within Ireland. But the ﬁrst attempt at interconnection ﬂoundered when one of the service providers, PostGem, assumed responsibility for managing the process. In 1996 a group of disgruntled ISPs set out to create an alternative and genuinely independent exchange.
Internet users were also looking for ways to reduce their costs. Most were still relying on dial-up modems to access the nearest connection point and many had to pay for these calls at cross-country, rather than local rates. By the end of 1996, however, Ireland On-Line and Telecom Eireann’s newly launched Telecom Internet both offered local connectivity throughout Ireland.
It was also apparent that mainstream IT operations were starting to migrate onto the internet. New web software products offered online security and transaction processing. Management and monitoring applications for private networks were evolving into intranet suites. And software service companies were offering to integrate databases with web applications.
The civil service belatedly accepted the internet and commissioned HEAnet in 1996 to provide access and support. The academic network service, indeed, had quietly grown into Ireland’s largest internet service provider. HEAnet was subsequently restructured and transferred its operations to a limited liability company.
Large enterprises embraced business-critical web projects with assistance from the first e-commerce practices in Ireland. IBM, Cambridge Technology Partners and Vision Group targeted this corporate clientele. The major banks launched web-based customer services, starting in their treasury and loans divisions.
The big beasts of the commercial jungle were now pouncing onto the internet.
1997: The end of the beginning
The recently-formed Irish Internet Association (IIA) conducted a survey in 1997, collecting 2,346 replies to a questionnaire on its web site. These enabled the organisation to draw up its first profile of online activity in Ireland.
The respondents identified slow access and security concerns as the most critical issues for the internet. Most users were now able to connect from their homes. More than 90 per cent accessed news and product information on the web. Some 40 per cent had made multiple online purchases and more than half said that they would not pay for information on the internet.
Just six years after the formation of IEunet, internet usage trends, habits and attitudes that would prevail well into the 21st century were clearly evident.
The internet was now perceived to be a communications medium rather than a set of standards for data networking. Furthermore, it was rapidly evolving into a dominant medium with a diverse audience. Only one throwback to earlier and geekier times was apparent in the IIA survey. Almost a quarter of the replies came from people with computer-related jobs.
Another indicator of the state of the internet was the composition of the IIA itself. The new association claimed to represent the interests of ‘those doing business on the internet’. Some of its members came from the ISPs and web site development firms. But others specialised in sales and marketing.
Internet access was turning into a commodity and moving closer to the mainstream telecommunications business. The founders of the industry industry had come from a very different culture and were uncomfortable with the changes. These pioneers had started to drift away in mid-decade and were finally eclipsed in 1997.
Two clear omens had appeared towards the end of the previous year.
First, Telecom Eireann decided to become a full-service ISP, catering for consumers and home offices as well as for commercial customers. It created a new business unit, Telecom Internet, that gradually absorbed Eirtrade with little fuss or publicity.
A second omen emerged when Esat Telecom announced its plans for a business-oriented internet service called EasyNet. This group had become Telecom’s strongest competitor in long distance and international telephony. It was also a major shareholder in Esat Digifone, Ireland’s second mobile network operator, which was launched in March 1997.
These statements of intent by two large corporations worried the independent ISPs. They resolved their disagreements over interconnection. The Internet Neutral Exchange (INEX) was commissioned in May 1997 under independent management. The new switch initially routed national internet traffic among EUnet Ireland, HEAnet, Indigo and Telecom Internet. PostGem gave up its ambitions to run an alternative exchange and joined INEX later that summer.
Despite the EasyNet announcement, it soon became evident that Esat did not intend to grow an internet service from the bottom up. It wanted to invest in an established provider and it was able to obtain funding on a scale unthinkable for any of the existing ISPs. In November Esat raised $78 million through an initial public offering. Just days later the group announced that it had purchased EUnet Ireland. It renamed the business Esat Net, describing the acquired company as ‘the largest provider of internet solutions to the corporate market in Ireland’. Esat bought another sizeable chunk of that market in 1999, when it hoovered up PostGem and the not-so-corporate Ireland On-Line customer base.
Indigo also changed hands. Esat attempted to acquire it, but it was Telecom Eireann that took over the company in November 1997. Medianet and Internet Ireland remained autonomous for longer. Medianet was finally sold in October 1999. Via Net.Works, an international internet and electronic commerce company, became its parent corporation. Three months later Princes Holdings, which was part-owned by Independent Newspapers, purchased Internet Ireland.
The country’s internet pioneers had departed from the industry and a very different business model now prevailed. This set the stage for an e-business bubble and the brief, but raucous, careers of the wildly ambitious commercial ventures that became known as ‘dot coms’.
The internet age was was still young, but the era of the trailblazers was over.
Last edit: June 2019
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