When you upload new snaps of your pals or family via your smartphone, they are not, as my 10-year-old grand-daughter believes, stored on this handy device, even though they can be whistled up very promptly. It runs out of juice quickly and the cat videos are actually stored on something called ‘the cloud’, which means on a great big computer facility somewhere else.

The cloud is an ingenious phrase, conjuring up an image of something like limbo, where unbaptised infants could kill time prior to their ultimate ascent to a more benign location in the heavens.

The phrase is ingenious precisely because it conceals how the digital world operates, via data centres owned and operated by Amazon, Google, Microsoft and the other big tech companies.

ADVERTISEMENT

You pay for the privilege of storing all this stuff, directly and indirectly. The indirect payment comes through advertising – the tech companies are the biggest advertising agencies in the world, which is how they make most of their revenue. The trick is not to charge for useful services like search engines, just make them free while making it hard to filter out all the unwanted ads without paying directly for an online service which dodges them, or claims to do so.

There may be other hidden costs via the internet service providers and Government regulators can join in the fun, through tax deals which favour the tech giants, or sweetheart deals with data centres for utilities like water and power.

The digital giants have become the biggest companies in the world, partly because of the genuine value that is created but also because of the pretence that everything is delivered effortlessly through something cuddly and innocuous, floating free as a cloud.

Ireland is a already a major player in the data centre business. If you have wondered where, on terra firma, the cloud is actually to be encountered, take a look around the outskirts of the city of Dublin and you should be able to spot a few large warehouses full of servers and with very few staff.

Around 21% of Ireland’s electricity generation is already absorbed by data centres and Government ministers talk airily about the imperative of further data centre development, with a 30% share contemplated a few years hence.

The European norm for electricity consumption by data centres is around 4% or 5%, so there is something unusual going on.

Data centres must be mainly an export business – purely domestic demand cannot credibly exceed the European norm. The principal operating costs of data centres are the depreciation of the server farms much of whose equipment is imported, and electricity, which is not cheap here. Ireland has recently become a net importer from the UK.

Exporting electricity, which does not rank as something Ireland is good at, is a curious strategy, and the centres also have strong water requirements.

Eirgrid has called a halt to data centre connections in the Dublin area and the city’s water infrastructure is also inadequate.

It is time to ask questions about the scale of the existing data centre industry, never mind the myopic ambitions of ministers. What is the actual employment content and the contribution to domestic value added?

The business lobby groups counter criticisms about the data centres’ appetite for electricity by talking up the bountiful Atlantic and its offshore wind resources. Two major wind operators have recently opted out of Irish Atlantic acreage and the truly commercial opportunities off the west coast may be illusory – the willingness of generators to put hard cash into deep-water operations has weakened.

If there is international competition to create the most generous regime of subsidy, for example with grants to seaports or the shifting of price risk away from generators onto the State balance sheet, it might be wise to lose.

The budget due next Tuesday will be followed by the revelation, finally, of the medium-term budget strategy.

If this includes large, central Government financing of electricity transmission and of commercial seaports to serve offshore generators, this should be seen as a departure from settled policy and indirect subsidy to the data centre industry.

In the success internationally of big tech, the newspapers and mainstream broadcasters have shipped the most serious collateral damage.

Online competition has eroded print circulation, while TV and radio audiences have been in long-term decline, most recently from the inroads of streaming services. Many US cities now have no daily newspaper and closures are also threatened in Europe.

The biggest damage has been to advertising revenue, where the tech companies can offer superior targeting of audiences (with or without their permission).

New technologies always damage the old – nobody laments the disappearance of the horse and cart – but the legacy media have a gripe where the State subsidises the competition.