Businessman and media owner Denis O’Brien’s role in Irish society is once again to the fore of political debate, Siobhan Mitchell reports.
Giant images of Cork-born but foreign-resident businessman and media owner Denis O’Brien led the 2015 May Day march in Dublin. For the activists of the Spectacle Of Defiance and Hope community group, he embodies the unequal class-based nature of Irish society.
However, it was not until late May and a speech by Independent TD Catherine Murphy in the Dáil that O’Brien was thrust, once again, into the media spotlight. Murphy alleged that O’Brien received beneficial treatment in relation to interest rates on loans of hundreds of millions of euros from the State-owned Irish Bank Resolution Corporation. O’Brien attempted to halt the media reporting what Murphy said in the Dail with a High Court injunction. After much legal wrangling his challenge was unsuccessful.
What increased the controversy surrounding these explosive allegations was that during the post-2008 crash period when O’Brien was allegedly receiving preferential interest rates on massive borrowings, he had also bought the infrastructure company, Siteserv, from IBRC. Prior to its purchase IBRC had written down the value of the company by approximately €100 million. After O’Brien bought Siteserv it went on to win several lucrative contracts to install water meters.
Anti-Austerity Alliance TD Paul Murphy has described the links between O’Brien, IBRC, Siteserv and the establishment of Irish Water as epitomising all that is wrong with the current Government’s policy of forcing austerity on ordinary people.
However, Denis O’Brien has had a much longer controversial role in Irish society. His wealth has seen him gain entry into the global elite, from the Trilateral Commission, to Bill and Hillary Clinton’s inner circle but he has never managed to dispel the continued questions surrounding his relationship with politicians, particularly leading members of the Fine Gael.
His wealth has see him gain entry into the global elite
O’Brien’s early breakthroughs in the telecoms business were made possible by the anti-state enterprise policies of the EU and successive Irish governments. O’Brien’s first company, Esat Telecom, established in 1990, piggybacked on the state-owned Telecom Éireann. Esat Telecom made no infrastructural investment but relied on EU rules to lease lines from Telecom Éireann from which it could then offer select companies the opportunity to queue jump other customers for international calls.
O’Brien’s next big step also arrived courtesy of the privatisation policy and the sale of the Republic’s second mobile phone franchise. While Esat Telecom was successful, it remained very much a niche product. Its move to the big time came when it linked to the Norwegian company Telenor AB to create Esat Digifone and in 1996 won Ireland’s second mobile phone licence. This was the cause of much controversy then and has remained so to the present time.
The Moriarty Tribunal was established to investigate allegations of corruption in this deal. It found that the licensing process was “fatally flawed” and that the then Minister for Communications, Michael Lowry, had a defining influence in the awarding of the licence to Esat. It also found that Lowry had benefited from funds which originated with O’Brien.
The importance of Esat Digifone and the second mobile licence to O’Brien cannot be over emphasised. In profile terms it moved O’Brien from a niche market player to a national player in a rapidly expanding market. When Esat Digifone was sold to BT in 2000, after a major falling out between the original stakeholders, O’Brien personally netted €317 million from the sale. The fact that he had moved his official residence to Portugal meant that he paid no tax on this massive windfall.
O’Brien’s present wealth still relies heavily on the mobile phone and internet market. Having left the Irish mobile phone market, O’Brien established Digicel and concentrated on the Caribbean, particularly Haiti. This company has been massively successful with a reported 11 million subscribers. Business and Finance estimated that in a 2007 bond issue, O’Brien made €800 million. However O’Brien and his companies have had setbacks especially in Jamaica and Myanmar (Burma).
Another major money spinner for O’Brien is his ownership of Topaz Energy, which he bought from IBRC in 2013. This company owns all the Topaz petrol stations throughout Ireland as well as the associated ReStore outlets. So successful has this venture been that at the end of last year Topaz Energy announced the takeover of 38 Esso stations and the supply of a further 60 independent stations. This gives O’Brien a powerful position in the petrol station and convenience store sectors. More recently he has moved into private healthcare, buying the Beacon Hospital in Dundrum in Dublin.
O’Brien is also the dominant player in the Irish media market. In 1989 he established Communicorp Group Ltd which subsequently built up a huge portfolio of national and local radio stations, including Newstalk and Today FM. In recent years he ousted the O’Reilly dynasty from the Independent News and Media (INM) group and is its largest shareholder. O’Brien claims not to control INM, but both journalists and broadcasters have gone on the record to claim that he does not interfere with the company’s editorial operation.
Media researcher and founder of the Critical Media Blog, Henry Silke, said: “Owners, in the main, do not control the output of their publications and stations in a direct fashion. Rather, it is through hiring policy; owners tend to hire people for key positions with similar politics to their own.
“Newstalk is a good example of this. The station’s two prime drivetime shows are hosted by ex-Fine Gael Minister and businessman Ivan Yates in the morning, and Fine Gael supporter George Hook in the evening. Likewise, editors and managers may be hired in line with the political views of key shareholders.”
Silke also highlights the fate of journalist Sam Smyth who was sacked from Newstalk. While Newstalk claim that Smyth was removed because of low ratings, it has been alleged his reporting of the Moriarty Tribunal, in which he was highly critical of O’Brien, was a major factor.
Social media has however played a critical role in the most recent O’Brien controversy. When RTÉ and most newspapers backed away from reporting the allegations made by Catherine Murphy due to legal threats, anyone could access the speech online, read the speech on the Oireachtas website or on numerous blogs and in international newspapers. If anything, more people may have watched or read the speech due to the controversy O’Brien’s legal threats generated.
But Silke warns that the internet is not the solution to the problems facing the public discourse in Ireland. “O’Brien and other wealthy individuals concerned with Ireland are very willing to turn to solicitors and barristers who will utilise Ireland’s very stringent libel laws to stop media reporting certain issues. O’Brien, in the latest controversy, even sent solicitor’s letters to Broadsheet.ie’s server provider to order them to remove articles on the Catherine Murphy speech.”
He added: “This legal situation has been a factor in the lack of investigative journalism in Ireland has made little effort to investigate powerful interests. In the main, contemporary investigative journalism in Ireland involves the accessing of Freedom of Information orders on overspending in various government departments, which while useful is far less risky and does not challenge the real financial power in contemporary society.
“It is of no surprise, therefore, that the Siteserv story was first covered in detail in 2012 by The Socialist’ the monthly newspaper of the Socialist Party.”
The current controversy surrounding O’Brien is now the subject of a judicial investigation following intense opposition pressure on the Fine Gael and Labour Government.
O’Brien now officially lives in Malta, where he pays virtually no tax on his income. Former senior backroom figures from both the Labour and Fine Gael parties sit on the board of O’Brien companies, as does the former Fianna Fáil Taoiseach Brian Cowen, who is a director of Topaz.
