Comreg sets pricing for LLU

Moriarty

Press Release

Full Decision

ComReg sets price for eircom’s Local Loop Unbundling (LLU) Charges

The Commission for Communications Regulation (ComReg) today issued a draft decision to fix eircom’s charge for Local Loop Unbundling (LLU) at €14.65 per month.

Given the time that it has taken to reach a conclusion on this matter and in the interests of certainty, ComReg proposes that this price would remain fixed in real terms until 1 December 2007.

ComReg has today issued two papers in relation to LLU. In the first document (ComReg 04/90), it concludes that eircom should be allowed to recover only the efficient costs of running the network. eircom has consistently disagreed with this approach. In the second (ComReg 04/91) ComReg proposes to direct a price of €14.65 which is consistent with these principles.

In May 2003, ComReg directed eircom to amend its LLU price to €14.67 per month. eircom had proposed a price that was significantly higher. That decision was challenged by eircom in the High Court. ComReg and eircom subsequently settled these proceedings. One of the terms of that settlement was that ComReg would initiate a new process for LLU pricing. The then prevailing price of €16.81 was left in place pending the availability of a new price. That process is now complete and a new price has been set.

In April 2004, ComReg published its conclusions arising from its review of the market for Local Loops. eircom was found by ComReg to have significant market power. Obligations were imposed on eircom by ComReg, including obligations relating to cost recovery, price controls and the obligation for cost orientation of prices. ComReg’s findings were notified to the European Commission.

The Chairperson of ComReg, John Doherty said: Resolution of this matter is long overdue. While acknowledging the steps taken by management to address eircom’s efficiency, ComReg has, in arriving at this price, factored into its calculations the need for continuing and accelerating efficiency improvements in eircom ”

Comments on the draft direction are invited, on or before, 28 September 2004.

Full details are available under ComReg 04/90 (Response to consultation) and 04/91 (Draft diretion) at the publications section on the ComReg website.

spongebob

€14.65 , the Highest in the whole of the EU . Most EU countries pay less for a full service line with dialtone and whatnots at the end of it and VAT thrown in , Comreg decided that this was good value for a piece of mingin Irish copper.

A triumph for Comreg what a bunch .

M

Moriarty

A 2 cent price reduction. To last us three and a half years.

I must say, I'm honestly impressed with comreg at this point. What other agency could take a year and a half to reduce a price from €14.67 to €14.65? It must have been a hard graft mind, they seemingly aren't wanting to go through that for another few years.





For fuck sake..

Ripwave

Moriarty wrote:

A 2 cent price reduction. To last us three and a half years.

I must say, I'm honestly impressed with comreg at this point. What other agency could take a year and a half to reduce a price from €14.67 to €14.65?

The current price of LLU is €16.81, not €14.67. €14.67 is the price that Comreg tried to introduce 15 months ago, before that was stalled in the Four Goldmines.

Not only is this the highest in Europe, it will be even higher by the time of the next review, because "ComReg proposes that this price would remain fixed in real terms until 1 December 2007", in other words, it can be increased in line with inflation, whereas, as we saw as recently as last week, the trend in other countrys is downwards, not upwards.

It's odd that they don't mention what eircoms "significantly higher" price was.

eircomtribunal

Moriarty wrote:

A 2 cent price reduction. To last us three and a half years.
reduce a price from €14.67 to €14.65
For fuck sake..

After OFCOM's slashing of the UK LLU pricing by 70%, Comreg's pricing is an especially hard to swallow slap in the face. I had had some tiny private hopes of a change in Comreg...

Does Comreg set a price for shared unbundling - that is where the new UK price is set at 355 cent per month?

P.

mike65

I feel an IOFFL PR release comming on...

Mike.

eircomtribunal

Ripwave wrote:

It's odd that they don't mention what eircoms "significantly higher" price was.

28 euros

P.

spongebob

The full spiel from Comreg is a third document not yet mentioned in the thread and to be found Here

It contains gems such as:

One of the respondents correctly pointed out that Europe Economics has failed to correct for the lognormal distribution when transforming the estimated logarithmic values into actual values for Ireland. This is needed because the dependent variable of the estimated model for direct operating costs is a stochastic variable, and, given the assumptions underlying the model used, it is distributed according to the
lognormal distribution. The expected value of the direct operating costs is therefore equal to the exponential of the sum of the mean and half the variance. Therefore the variance of the regression was obtained and halved (approximately 0.0334), and then added to the predicted value before the exponential transformation into a dollar figure. The effect of this correction is to increase the estimated direct operating cost by 3.4 per cent, bringing the total operating cost to €3.24 per month
per line.

I'd love to ' obtain and half ' a Commissioner right now, and then quarter and draw it for good measure.

In response to the simple question of "how much does a shared line costing €3.55 a month in the UK cost in Ireland " I believe the answer is that they chickened out and are having another consultation on it. My head is wrecked reading that guff .

M

damien

mike65 wrote:

I feel an IOFFL PR release comming on...

I feel maybe you could be right. I further feel that maybe there's going be more than a press release about this.

Hi Tom !*


*injoke with my pals in Comreg.

jwt

All I can say is WTF!

Its a draft direction, so its time to comment!

We are gathering some facts and figures at the moment, and will post some details here so that members can mail their objections quoting some real facts to back up their objection.

A press release will be released voicing our disgust

I am doing an interview with East Coast FM tomorrow at 11:30 am and I will raise it as an example of Comreg ineptitude.

John