Ireland is losing out on foreign direct investment (FDI) because of "parish politics", according to Google Europe head John Herlihy. "Instead of fighting about stuff like whether it should be in Limerick or Letterkenny, and losing it to Barcelona, we should be focused on winning it for Ireland," he said. He added that future investment is likely to be focused on the eastern seaboard because the global trend was towards "megacities".

He called for a greater focus by Ireland on the EU and said Ireland could become a world-class location for intellectual property (IP) related businesses. "One of the factors that encourages open innovation is the degree of flexibility in the IP and copyright regimes. Open innovation does not replace proprietary innovation, but it is complementary, and thus far has been largely overlooked in Europe's IP strategy," he said.

Herlihy was speaking a day before the IDA launched its Horizon 2020 report, which aims to create 105,000 jobs by 2014 and secure 50% of that FDI outside Dublin and Cork. Herlihy said he was a huge fan of the IDA and its work.

However, he criticised third-level education standards in Ireland.

"In general, what we've done is we've gone for volume [in terms of graduates] as opposed to quality and we just need to basically make sure that we don't lose out on quality," he said. "Quality wins. If you want to be in a business which is based on 'smarts', quality wins. It's not volume; volume is for volume manufacturing, quality drives change. And we need to get back at the quality end."

On the EU's antitrust case against Google he said he believes its auction system is highly transparent. "We'll be very forthright in the whole area. We feel very comfortable… Some of those appealing were customers we had healthy relationships with who have since been bought by rivals," he said. He said that US president Barack Obama's transfer pricing regulations were still under discussion within Google.

Speaking last week at a Digital Landscapes seminar organised by UCD Smurfit School, Herlihy said Irish business needs to learn to "to celebrate failure. A fast death shows you where not to go. However, once you know something is wrong, kill it."