Deutsche Telekom to kill flat rate in germany ?

ednwireland

nobody tell eircom !


http://www.ovum.com/go/content/015741.htm


This week’s decision by an administrative court in Cologne could mean the end of flat-rate narrowband Internet access in Germany, as providers such as AOL have the rug pulled out from under them by Deutsche Telekom.

The ruling by the court effectively halts a decision by the German regulator RegTP demanding DT be required to offer a wholesale flat-rate Internet access product (known in the acronym-friendly world of telecoms as FRIACO) to its competitors. This is on the basis that DT no longer offers such a product at the retail level.

AOL and other ISPs rely on such products to offer sustainable flat-rate access to their customers, and this decision may well prevent them from offering such products in the future in Germany. AOL, which openly admits that it will not offer flat-rate without FRIACO, will be the hardest hit of the ISPs.

But this week’s development is also indicative of a more general trend which means that narrowband flat-rate is still only a remote possibility in many European countries.

FRIACO-style products are available in six other European countries – the UK (which was the first to introduce FRIACO), the Netherlands, France, Spain, Portugal and Italy. However, apart from this band of early adopter countries there has been little interest in the rest of Europe, despite lobbying by the European Commission and the European Competitive Telecommunications Association (ECTA).

The main problem is that like the court, most regulators believe incumbent operators shouldn’t have to offer wholesale products which they are not already using themselves. In the UK and other countries, FRIACO was introduced because the incumbents were providing flat-rate Internet access to their retail customers, and so they were clearly internally using a form of FRIACO. The principle of non-discrimination dictated that whatever wholesale product incumbents were using internally must also be offered to their competitors.

The flip-side of this regulatory coin is that when incumbents aren’t using a wholesale product themselves, they have no obligation to offer it to others, and this is the justification for the court’s decision. The same reasoning has been applied by regulators in other European countries who have refused to mandate FRIACO provision by incumbents who don’t provide a retail flat-rate product.

Glimmer of hope?
However, the new EU regulatory framework for electronic communications makes clear that the non-discrimination argument is not the only one which regulators and ISPs can use to force FRIACO to be provided. This offers a glimmer of hope for the likes of AOL, and those who depend on their services.

The new EU rules contain a provision for national regulators to require incumbents to meet reasonable requests for access to network elements where denial of access would hinder the emergence of a sustainable competitive market at the retail level.

This provision could easily be used by regulators keen to see the introduction of FRIACO in countries where incumbents are not currently offering retail flat-rate packages. It could also be used in the appeals process against the Cologne court’s decision.

The very reason many incumbents are not offering flat-rate is that they are worried they’ll have to offer FRIACO as a result. But their decision is hurting more than just their competitors – it’s harming ordinary end-users and the development of the market too. Flat-rate users spend twice as long online each month as per-minute users, and flat-rate provides a useful bridge between per-minute dial-up and broadband access, thus helping the development of the market.

Regulators who are brave enough to take on incumbents and, if necessary, the courts, should pursue this tool in the new framework to get FRIACO mandated. ISPs in Belgium and Ireland are clamouring for FRIACO from Belgacom and Eircom respectively at the moment, and regulators there should be some of the first to go down this route. Others in the rest of Europe should then follow suit.

MDR

Flat-rate has probabily served its purpose in Germany at this stage (ie built the demand).

The same company has widespread DSL, and a product €7 a month, free modem and a 2 gig cap. Perhaps someone should tell Eircom.

ednwireland

yeh i would think that eircom would say that look whats heppening in europe therfore we don't have to do friaco (without doing all the other stuff - being eircom)

Eurorunner

My first experience of DSL was with Deutsche Telekom.The company has a dreadful reputation - just like eircom they were floated on the markets and are now deep in the red. Due to their cash flow problems, when i was there last year, if you did not pay your phone bill within a week, they cut you off ..(no joke).

Their customer service is dreadful - they have a number of call centres round germany filled with muppets who dont mind putting you on hold for an hour and when they dont like your query, they simply cut the call.

___

Having said all that, coming home has made me appreciate a few things..

Whilst Telekom were the pits,

when there wasnt any need to use their customer service, life was good:p
Broadband ADSL was cheap €25/month.
There was no cap - and this was never an issue over there.

I always knew that this aspect (lack of connection) of coming home was going to be truely horrible, but nothing can prepare one for not only the lack of available options but the blatant abuse within the telecoms sector that prevents one from what i now regard as a basic utility.

Urban Weigl

Originally posted by Eurorunner
Their customer service is dreadful - they have a number of call centres round germany filled with muppets who dont mind putting you on hold for an hour and when they dont like your query, they simply cut the call.

That rings a bell... Are you sure you aren't talking about Eircom?

query

The same Deutsche Telekom doesn't offer a wholesale DSL product, or full Carrier Pre-Selection.

spongebob

the imminent USO directive, to be in force everywhere in 3 weeks or so, entitles national regulators in the EU to force the 'creation' of a product by the likes of €ircon and DT and BT in the UK

the regulator could force them to 'create' a wholesale product even if they did not intend to offer a retail version of it themsleves.

Ironically something similar to this is what has apparently happened with Eircom and FRIACO, Eircom have no retail version available, they are relying on customer inertia and their winback scum to keep the revenues up. I think they will hear the giant sucking noises very soon and will come up with their own FRIACO offering in the Autumn.

M

query

A little knowledge is no doubt a dangerous thing - it's the Access Directive. This requirement has always been in place in the previous Interconnection regime.

flav0rflav

1&1, Tiscali and ExpressNet would, to my eyes, appear to be wholesaling DT DSL.

http://adsl.einsundeins.com/index.php

http://www.tiscali.de

Die Tiscali DSL-Tarife basieren auf dem T-DSL-Anschluss der Deutschen Telekom AG, durch den weitere Kosten entstehen. Dieser ist in vielen Anschlussbereichen verfügbar.

Germany word for the day Anschlussbereichen.

spongebob

Originally posted by query
A little knowledge is no doubt a dangerous thing - it's the Access Directive. This requirement has always been in place in the previous Interconnection regime.

It may be in the Access Directive too and have been in the previous one as well.....about which directives I profess to know feck all anyway.

Have a look at Article 9(2) in the USO Directive too, its
Here .

M

query

Access Directive deals with wholesale arranagements - FRIACO, Interconnect, DSL etc.

USO with end users.

spongebob

the rights of the end user .....

check Article 32 as well

M