Eircom Discussion on Liveline (now with mp3 link)

capistrano · 15-01-2004 1:08pm

The Eircom "Vulnerable User Scheme" (VUS) has come in for some critism on this thread but it is not too bad really.

Here are some comparisons for call costs of 0, 5, 10 and 20 euro per month.

€0 - €22.50 for VUS, €24.18 for regular
€5 - €22.50 for VUS, €29.18 for regular
€10 - €33.50 for VUS, €34.18 for regular
€20 - €43.50 for VUS, €44.18 for regular

So you are always better of with VUS, especiually if your calls are less than €5 per month.

Now that I have ADSL and use my mobile for most voice calls I reckon I'll be under €5 per month so I've just signed up.

vinnyfitz · 15-01-2004 1:18pm

Err Capistrano - do you not suspect VUS will go up now by €1.68 in tandem with the line rental price rise? (I could be wrong of course but this is Eircom we are talking about)

I'm not sure where you get your calculations? Can you post a source?

My undestanding was that once you exceeded the €5 limit your next €5 of calls were double priced to make sure there is no saving once you consume €10 or more.

capistrano · 15-01-2004 1:34pm

I calculate the prices from the details of the scheme here: Vulnerable User Scheme

Eircom may well increase the price to the new line rental price but they have not yet (I signed up this morning). But even if they do it is still better value for those who don't make many fixed line calls. Essentially, the first €5 is free and the second €5 costs double plus a €1 charge.

I only need an eircom line becasue I want ADSL, so for users like me this is a great scheme, which effectively gives me €5 of free calls.

Ripwave · 15-01-2004 2:17pm

Originally posted by capistrano
I calculate the prices from the details of the scheme here: Vulnerable User Scheme

Which was posted on 2nd, May 2003.

Eircom may well increase the price to the new line rental price but they have not yet (I signed up this morning).

If you signed up for a new phone line this morning, you'd only be charged €22.50, because line rental doesn't go up until February 4th. If you got a commitment from oreillycom that VUS won't be going up on February 4th, please share it with us. If you didn't, then you should retract the misleading information in your previous post.

VUS is the same price as Line Rental. Increases in VUS are supposed to be capped at CPI+0%, but I'm pretty certain that that won't happen. (The "get out caluse" is that the "median bill" of VUS users is supposed to stay at CPI+0%. Which means that they only have to sign up a couple of heavy users, whose bills will come down when call charges come down, and they'll keep the increase in the median bill down.

I only need an eircom line becasue I want ADSL, so for users like me this is a great scheme, which effectively gives me €5 of free calls.

I think Mr Barnum had something to say about people like you :-).

If you only have the line for DSL, then getting €5 of "free" calls isn't a "great deal". It's simply a demonstration of the fact that you're paying too much for the line in the first place.

Ripwave · 15-01-2004 2:23pm

Originally posted by capistrano
But even if they do it is still better value for those who don't make many fixed line calls. Essentially, the first €5 is free and the second €5 costs double plus a €1 charge.

To put this in context, a user who makes 1 3 minute call every day for a month will pay €22.50 (or €24.18 from next Febrary).

That's an effective rate of 22c minute. This is your "great deal".

Or put it another way, this "vulnerable user" could get on the internet for an hour and a half every weekend. At an effective rate of almost €4 and hour.

capistrano · 15-01-2004 2:43pm

Ripwave, I really think you missing my point here. Line Rental is a ripoff, I totally agree. But if I only make €5 of calls per month then the VUS will save me at least €5 per month (possibly more if they don't increase the VUS price to to new line rental price). So, perhaps calling it a "great" is a bit much, but at least it is a better deal than the standard eircom ripoff.

Ripwave · 15-01-2004 3:18pm

Originally posted by capistrano
Ripwave, I really think you missing my point here. Line Rental is a ripoff, I totally agree. But if I only make €5 of calls per month then the VUS will save me at least €5 per month (possibly more if they don't increase the VUS price to to new line rental price).

No, I'm not missing your point. Your point is missing the point.

If you make less than €5 of calls a month, then you can't be saving "at least €5". You would be saving at most €5. But if you've only got the phone line in because you need it for DSL or a monitored alarm, then you're getting "free" €5 worth of calls that you don't want in the first place. That's not a "deal". Maybe if you've only got a phone line in so that your Sky box can "call home", it might be of some benefit, but wouldn't it be ironic if the real beneficiaries of the "vulnerable users scheme" were subscribers to Rupert Murdochs Sky?

So, perhaps calling it a "great" is a bit much, but at least it is a better deal than the standard eircom ripoff.

Nope, it's exactly the same as the standard eircom ripoff. (Even assuming that more than 1% or 2% of DSL users only have a phoneline so that they can get broadband).

capistrano · 15-01-2004 3:43pm

Originally posted by Ripwave
If you make less than €5 of calls a month, then you can't be saving "at least €5". You would be saving at most €5. [/B]

So, at least you agree I am saving something. I wil inevitably make some calls, especially if I know that I have €5 incuded in my monthly rental. That €5 will buy about 100 mins of off-peak national calls and nearly 400 mins of off-peak local calls.

I have to say, you sound like a very angry person. You are refusing to see even a small relative good in an Eircom offering. Eircom were forced into offering this and clearly they don't like it because they have never marketed it, you can't even find it on their website. I have no doubt that they see it as having a negative effect on their revenue.

vorbis · 15-01-2004 3:47pm

line rental is the cost of maintaining the infrastructure. Would you prefer to be billed for any pole that had to be replaced so that your phone stays working?

capistrano · 15-01-2004 3:57pm

Originally posted by vorbis
line rental is the cost of maintaining the infrastructure. Would you prefer to be billed for any pole that had to be replaced so that your phone stays working?

Don't be so naive. Line rental should be the cost of maintaining the infrastructure. But becasue it's the area where there is no competition Eircom are using it to generate extra revenue.

I don't know how many fixed lines there are in the country, but there must be at least 1 million and, if so, the line rental revenue would be almost €300/year. Do you think it costs Eircom €300m to "maintain" their infrastructure every year?

Remember also the owners took €400m in dividends out of the company last year.

Ripwave · 15-01-2004 4:32pm

Originally posted by capistrano
So, at least you agree I am saving something.

Read it again, capistrano. "At most" starts from 0. You're not saving anything if you're not saving anything.

I wil inevitably make some calls, especially if I know that I have €5 incuded in my monthly rental.

Everytime I shop in Tescos or Superquinn, I get a printed receipt with coupons on the back. If I get a "buy one get one free" Big Mac, but I only wanted one Big Mac in the first place, I'm not "saving" €3.50, or whatever a Big Mac costs. I'm getting something "free" that I didn't particularly want in the first place. It's not a "great deal". "Inevitably making some calls" that you wouldn't have made otherwise isn't a "bargain", or a good deal. You're still paying exactly the same as you would have if you hadn't signed up for the VUS, because you wouldn't have bothered making the phone calls in the first place.

That €5 will buy about 100 mins of off-peak national calls and nearly 400 mins of off-peak local calls.

Which, as I repeatdly pointed out, will effectively cost about 22c/minute for the peak calls, or €4/hour for off-peak. That's more than it would cost to use a phone box.

I have to say, you sound like a very angry person. You are refusing to see even a small relative good in an Eircom offering. Eircom were forced into offering this and clearly they don't like it because they have never marketed it, you can't even find it on their website. I have no doubt that they see it as having a negative effect on their revenue.

oreillycom didn't market it because it's a joke. Even if the 400 users who reportedly signed up for VUS last year each made exactly €5 worth of calls, it would have "cost" oreillycom €25K. Out of a total Line Rental revenue of over €340 million.

In return for that potential cost of €25K, ComReg removed the cap on the "Lower Quartile" bill. On other words, they swapped 400 "low usage" users for a cap of CPI+0% for hundreds of thousands of users. It would have been impossible for oreillycom to increase Line Rental by 23% in the last 12 months if this cap hadn't been removed. (Go on, read the Comreg document that you linked to earlier).

So your "relative good" for the tiny number of DSL users who have a phone line but don't make any phone calls (a few hundred, tops) has cost hundreds of thousands of ordinary users, whether they have DSL or not, a lot of money. I'm not angry, I'm increduluous that anyone would try and paint that as a "great deal". That you had to use misleading data to make your case simple adds insult to injury.

Ripwave · 15-01-2004 4:44pm

Originally posted by capistrano
I don't know how many fixed lines there are in the country, but there must be at least 1 million and, if so, the line rental revenue would be almost €300/year. Do you think it costs Eircom €300m to "maintain" their infrastructure every year?

Remember also the owners took €400m in dividends out of the company last year.

According to John Doherty from Comreg on Joe Duffy yesterday, there are 1.6 million lines in the country. That's about €360 million in Line Rental (ex VAT).(Though it's probably different, because it includes Business and Residential lines, I think).

According to this Sunday Busines Post article oreillycom planned capital spending of only €200 million last year. Other operators, who can't charge line rental, have to finance all their capital costs out of their call revenue.

15-01-2004 4:59pm

Why is it acceptable in the first place that a private company {read: private monopoly } should own the infrastructure on which other competing companies provide their service.

I heard some other tool from comreg on the last word yesterday slipping and sliding on the issue of eircoms monopoly on line rental.

regulation my aunt sally

Ripwave · 15-01-2004 5:06pm

Originally posted by Man
Why is it acceptable in the first place that a private company {read: private monopoly } should own the infrastructure on which other competing companies provide their service.

This would in fact be perfectly acceptable, if

that private company wasn't also competing with the other operators,
that company was required to provide cost justification for any price increases.

oreillycom doesn't meet either of these requirements.

Eircom Discussion on Liveline (now with mp3 link)

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