Another Eircom scam ?...

Paddy20

The hundreds of thousands of Irish citizens, who up until now were entitled to a free telephone line in their homes, are no longer receiving this basic allowance.

The Bi-Monthly free telephone allowance which is paid direct to Eircom, from the DSFA [Department of Social & Family Affair's] is €40.82c which was enough to cover Eircom's extortionate line rental charges until recently.

Now, Eircom charges €41.60c (inc vat) bi-monthly basic rental, and the last Minister for the DSFA Ms Mary Coughlan T.D., informed Eircom that she was not prepared to pay Eircom another unwarranted line rental increase.

As a result, Eircom are now billing the disabled, the housebound and the most vulnerable members of our society, for the grand sum of €0.94c every two months.

A stupid and unjust example of Eircom's anti social attitude. When you consder that the cost incurred by Eircom accounts, to send out hard copy bill's amounts to more than €10 each, in an attempt to collect a miserly €0.94c ?...

Sheer lunacy or what, and Eircom have threatened to immediately disconnect anyone not paying the €0.94c on time/by the due date.

N.B. Moderators, if you consider this is the wrong forum for this, suggest you move it to Rip-Off Ireland. :mad: Eircom screwing the Disabled, and elderly - for what. Let them explain that madness NOW. ?...

Gilgamesh

personally I think it is a joke that Ireland lets itself get trampled on by a Monopolist bulle like eircom

RuggieBear

Paddy20 wrote:

A stupid and unjust example of Eircom's anti social attitude.when you consder that the cost incurred by Eircom accounts to send out hard copy bill's amounts to more than €10 each, in an attempt to collect a miserly €0.94c ?...

Bastids....does it really cost €10 to post out bills and all that? can you give me a break down of that cost?
I actually got a gas bill yesterday for 17cents.....the mind boggles

Paddy20

It probably now costs a lot more, just ask Eircom's accounts department, or any qualified Chartered Accountant, for heaven's sake the postage, paper and large envelope alone cost's more than they are trying too collect.

PcP

The DSFA should get in contact with UTV and see about moving those people onto the UTV Talk thingy. Same rental, better value.

DonegalMan

Paddy20 wrote:

As a result, Eircom are now billing the disabled, the housebound and the most vulnerable members of our society, for the grand sum of €0.94c every two months.

Paddy, are you absolutely sure this is right?

If so, then it is not an issue for IrelandOffline IMO but it is definitely something that deserves an almighty fuss - 'Eircom Pinches Cents from OAPS' - I can just see the headline!

I suggest that you and any others affected by this start making a fuss about it - contact local TD's to complain, contact local media, write to national newspapers highlighting it - I'm sure some of them will pick it up as a good story.

Mr_Man

Can you image the further damage that would be done to Eircom's image if they cut off somebody for non-payment of 94c.

Also Eircm are desperate to hold on to as many Gubmt contracts as possible so if they piss off the Social Welfare folks then they will be shooting themselves in the foot.

Having said this, I'd not be surprised if some bean counter in Accounts cuts people off for non-payment

M.

SeaSide

Surely if you put you put the supply of lines to hundreds of thousands of phone users out to tender you'd get a better deal. Can you imagine what Oisin Fanning or Bill Murphy would do if they got the chance to get that much business in one go? Again its an example of a hidden subsidy to eircom.

damien

The Government as a group (this includes local Govt) pays eircom over 400 million a year for services which is 90-95% of it's telecoms budget.

Ripwave

DonegalMan wrote:

Paddy, are you absolutely sure this is right?

I have a copy of one such bill in front of me at the moment (the person whose bil it is gets billed monthly, not bi-monthly).

Line Rental 
   Residence line for 01 xxxxxxx 16 Aug 04 to 15 Sep 04          1 0.00 @ 0.00
   eircom Social Benefit Package 16 Aug 04 to 15 Sep 04                  20.80
Services Rental 
    eircom phone services 16 Aug 04 to 15 Sep 04                 1 0.00 @ 0.00

Other credit
Miscellaneous  Social welfare telephone allowance                       −20.41

That means that the "Social Benefit Package" (which includes line rental and
€1.21 of calls) costs 39c per month.

In the case of the bill I have here, that amounted to 15 minutes worth of calls:

Benefit package free calls
Free calls up to a value of eur 1.21 per month included in your eircom
social benefit package.
A Daytime calls    6  00:11:47  0.0000
B Evening calls   1   00:02:56  0.0000

Total of eircom social benefit package free calls calls 0.0000

Ripwave

SeaSide wrote:

Surely if you put you put the supply of lines to hundreds of thousands of phone users out to tender you'd get a better deal. Can you imagine what Oisin Fanning or Bill Murphy would do if they got the chance to get that much business in one go? Again its an example of a hidden subsidy to eircom.

Technically, the Government isn't renting the lines, so it can't tender for that service - it's is providing a benefit to certain members of the public (almost 300,000 members of the public), and it can't force those people to use one phone service rather than another. (And because the vast bulk of the money is for line rental, and not for calls, there isn't really anyone else who could tender for the task except eircom, at least until there is a realistic LLU option on the table. Though if NTL had it's act together, it could make significant in roads in areas like Crumlin and Kimmage, where there are large numbers of pensioners who are in receipt of this allowance - and because NTL wouldn't have to pay eircom for line rental, it could work out quite welll for them, if they did it right).

To be fair to the Department, it has made modifications to the scheme so that you get to keep the benefit even if you switch providers. Unfortunately, as recently as 3 or 4 months ago, when I contacted UTV about this, the support desk claimed to have no knowledge of the scheme, and couldn't tell me what would happen if someone who was in receipt of this allowance switched from eircom to UTV. The end result was that the person that I was inquiring for didn't switch.

Thankfully, UTV have now copped themselves on, and say that you'll still get the benefit if you sign on for UTV Talk, but they don't actually answer the question of "what's the procedure" - does UTV notify the Department, or does the customer have to fill in forms, and end up with the benefit going to eircom for 3 months while the paperwork is sorted out?


http://www.boards.ie/vbulletin/showthread.php?s=&threadid=118991

eircomtribunal

Ripwave wrote:

Though if NTL had it's act together, it could make significant in roads in areas like Crumlin and Kimmage, where there are large numbers of pensioners who are in receipt of this allowance - and because NTL wouldn't have to pay eircom for line rental, it could work out quite welll for them, if they did it right).

NTL has suspended all its telephony services because of security problems and advised customers to unplug the phones and look for other providers. If I remember right they mentioned to have some 2 and a half thousand customers or so.

P.

spongebob

Ripwave. Is that a VUS Rental (Vulnerable User Scheme) and has the government frozen its subvention at a certain level ? The VUS was created in June 2003 and it looks as if Eircom hiked their prices for the VUS but that the government did not track that hike.

We can see from this URL http://www.welfare.ie/press/pr03/pr030303.html that the government pays for some 280000 lines or 17.5% of ALL the analogue lines in the whole state through this scheme .

M

eircomtribunal

Ripwave wrote:

And because the vast bulk of the money is for line rental, and not for calls, there isn't really anyone else who could tender for the task except eircom, at least until there is a realistic LLU option on the table.

Or a realistic whole sale line rental, rather then the eircom resale minus 10% crap our regulator was handed by Eircom.

P.

Ripwave

eircomtribunal wrote:

Or a realistic whole sale line rental, rather then the eircom resale minus 10% crap our regulator was handed by Eircom.

That's what WLR means, Peter - it's simple a different name for "3rd party billing". The line still "belongs" to eircom, plugs into eircom switches in the exchange, and that will only offer services that eircom supports (so no broadband or even ISDN unless eircom provides it). The WLR discount will eventually be decreased, not increased.

WLR is just a delaying tactic by eircom, to avoid pressure to introduce LLU, which would allow genuine competition, if it was priced on an "economic operator" basis, rather than a "how much do we have to charge to make this uneconomical for our competitors" basis.

damien

Wasn't the last line rental increase allowed because of eircom's "co-operation" with the VUS scheme ?

They agreed to this scheme and in turn they got their line rental ? So Eircom got a guaranteed 5 Million payment per month from the Govt and for them to accept this they were allowed a line rental increase ? Can someone verify this ?

Ripwave

Muck wrote:

Ripwave. Is that a VUS Rental (Vulnerable User Scheme)

No - the VUS was another smokescreen, that, one year after inception had something like 400 people signed up (something to do with the fact that they never told anyone about it).

We can see from this URL http://www.welfare.ie/press/pr03/pr030303.html that the government pays for some 280000 lines

That's from March 2003 - the letter I quoted is from October 2003, and says "At the end of August 2003 there were 286,679" recipients.

damien

So, now 286,679 customers are being charged an extra 39 cents per month. Which means eircom are taking an additional €1,341,657.72 per year from what the scheme itself and what eircom agrees to be "vunerable users".

Can someone factcheck me ? Are my assertions and facts correct ? Muck, Ripwave, Peter ?

damien

Ah crap, they're not vunerable users. They just po. Thanks for the clarification.

Ripwave

damien.m wrote:

Wasn't the last line rental increase allowed because of eircom's "co-operation" with the VUS scheme ?

They agreed to this scheme and in turn they got their line rental ? So Eircom got a guaranteed 5 Million payment per month from the Govt and for them to accept this they were allowed a line rental increase ? Can someone verify this ?

Not quite. Eircom applied for a 15% increase in January 2003, but they were only allowed 7.9% then, and had to wait 3 whole months for a further 6.3% increase, after they had introduced the VUS. The VUS was just dragged into the spotlight this year as a way to distract the baying public - it's entirely irrelevant, as you still have to pay the full line rental - there is no "discount", and when you compare it to the UTV Talk package now available, the deal is risible (especially when you bear in mind that eircom earns far more money from UTV Talk customers than UTV does).

Here's a nice exchange between Simon Coveney and John Doherty at the Joint Committee on Communications, Marine and Natural Resources, in January of this year (http://www.gov.ie/oireachtas/Committees-29th-D%C3%A1il/jcmnr-debates/jccmnr280104.rtf)

Deputy Coveney: I welcome this first opportunity to have a discussion with Mr. John Doherty as the new chairperson of ComReg. I wish him well in his challenging job.
There seems to be a slight conflict in the information given on the increases in the last 12 months. Can we have these confirmed? Is the Consumers' Association of Ireland incorrect in stating that there was a 7.9% in March 2003, a 6.3% increase in May 2003 and another 7.5% recently? Is that not factually the case?

Mr. Doherty: It is factually the case. What is incorrect in those figures is that the first two elements were a single price increase application by Eircom that ComReg refused to accept. ComReg delayed the second part of that price increase until the vulnerable users scheme was in place.

Deputy Coveney: How many users are in the scheme?

Mr. Doherty: I think there are 300 or 400 using it.

Deputy Coveney: Between 300 and 400 in the entire country, despite the sanction of a overall 25% increase in the last 12 months?

eircomtribunal

Ripwave wrote:

That's what WLR means, Peter - it's simple a different name for "3rd party billing".

When Dermot Ahern told the Comms Committee of the Oireachtas in January about the wholesale line rental product he was going to direct Comreg to introduce, he was speaking of something different than a 3rd party billing:

"It is designed to cut line retail prices to Irish consumers by allowing telecoms companies to compete against Eircom for line-rental.

It is designed to cut line rental prices by giving telecom companies the potential to undercut the Eircom price. And it will give Eircom the incentive to keep prices down.
It is designed to build jobs, lower phone prices for Irish consumers, which in turn will lower inflation.

I will direct ComReg to insist that the margin between wholesale and retail is wide enough to drive competition."

A 10% margin cannot drive competition.
A "eircom resale minus 10%" price structure cannot "give Eircom the incentive to keep prices down."
All Comreg did after Dermot's directive was to change the 8.5% margin they had envisaged to 10%.

SeaSide

Ripwave wrote:

Technically, the Government isn't renting the lines, so it can't tender for that service - it's is providing a benefit to certain members of the public (almost 300,000 members of the public), and it can't force those people to use one phone service rather than another. (And because the vast bulk of the money is for line rental, and not for calls, there isn't really anyone else who could tender for the task except eircom, at least until there is a realistic LLU option on the table.

pays piper - calls tune

.Gov instead of paying for the lines supplies the lines. Customer still gets billed for calls. Maximum call rates are set as part of the tender process together with some tracking mechanism.

If a user wants to change provider they can but they still only get the tendered line rental level. The result would be that any telco that wanted to pick up part of the business would have to match the line rental.

Ripwave

damien.m wrote:

Which means eircom are taking an additional €1,341,657.72 per year from what the scheme itself and what eircom agrees to be "vunerable users".

No - this has absolutely nothing to do with the Vulnerable Users scheme.

Forget about VUS - it's a red herring, and it's only purpose is to allow eircom to drag it out from the cupboard every time there's an uproar about price increases. Why would you want to pay €23.65 per month just so you can make a €5 worth of calls? Even with our outrageous mobile rates, you'd be better off with a mobile. The only constituency that might conceivably benefit is someone who wanted a line just to get broadband - hardly a "vulnerable user".

(Just for fun, go to www.eircom.ie and type vulnerable in the Search box. You'll get 7 links back. The 4 of them point to a page that says

To find out more about eircom's vulnerable user scheme click here and navigate to page 35.

It's a 31 page document!

The FAQ says:

Who can avail of vulnerable user scheme?

• ISDN customers cannot avail of this scheme as the vulnerable user scheme is a PSTN product
• If you are currently on another eircom discount scheme you must cancel that to avail of the vulnerable user scheme instead.
• Customers who are with another operator are not eligible for the vulnerable user scheme.

Ripwave

eircomtribunal wrote:

When Dermot Ahern told the Comms Committee of the Oireachtas in January about the wholesale line rental product he was going to direct Comreg to introduce, he was speaking of something different than a 3rd party billing:

"It is designed to cut line retail prices to Irish consumers by allowing telecoms companies to compete against Eircom for line-rental.

It is designed to cut line rental prices by giving telecom companies the potential to undercut the Eircom price. And it will give Eircom the incentive to keep prices down.
It is designed to build jobs, lower phone prices for Irish consumers, which in turn will lower inflation.

I will direct ComReg to insist that the margin between wholesale and retail is wide enough to drive competition."

A 10% margin cannot drive competition.
A "eircom resale minus 10%" price structure cannot "give Eircom the incentive to keep prices down."
All Comreg did after Dermot's directive was to change the 8.5% margin they had envisaged to 10%.

What, you believe a politician more than you believe me? I'm insulted!

I don't give a damn what Dermot Ahern said - I'm telling you that WLR is bull****. If you'de rather believe Dermot, be my guest.

damien

Ripwave wrote:

No - this has absolutely nothing to do with the Vulnerable Users scheme.

Forget about VUS - it's a red herring

I have ! I clarified in a follow-up post. See post No. 19 on the first page.

Ripwave

SeaSide wrote:

pays piper - calls tune

.Gov instead of paying for the lines supplies the lines. Customer still gets billed for calls. Maximum call rates are set as part of the tender process together with some tracking mechanism.

If a user wants to change provider they can but they still only get the tendered line rental level. The result would be that any telco that wanted to pick up part of the business would have to match the line rental.

Maybe the Government shouldn't give people money when they're on the dole either? It should contract with Brennans for a couple of hundred thousand loaves of bread every day, and Avonmore for a couple of hundred thousand cartons of milk?

The benefit is aimed at individual. It's paid directly to the comms provider to simplify things, and minimise the hassle for everyone - the end user (who doesn't have to worry about it), the comms provider, who doesn't have to deal with bad debts on that part of the bill, and the Department, who only have a small number of providers to pay). They should get a massive discount, but that's a historical problem, dating back to the time that eircom was a semi-state anyway.

There would be no point in tendering for this service at this point, because no other land-line company can deliver a phone line without paying eircom for it - the margins just aren't there to make it worth the effort. Only alternative providers who didn't have to pay €20 to eircom out of the €20.40 the department provides would be interested. There should be some niche business for old folks homes (where the income from say 10 "social benefit packages" could be pooled to proved a VoIP service with free broadband, or a disocunt mobile package might be attractive). But having "Social Welfare Telecom" wouldn't be the best way forward, because it would just perpetuate the eircom dole, and wouldn't do anything to solve the problem of the exhorbitant line rental.

eircomtribunal

If I remember correctly the introduction of the VUS had to do with the line rental increase mechanism:
Eircom were allowed to rise the price of the "basket" by a certain percentage (some 5% or so). They did it by loading a 25% increase onto the line rental part, decreasing the call charges, thus squeezing out the competition, who cannot compete on the rental side.
But there is another condition set in the basket increase mechanism. It demands that the low bill payer, something like the quarter of customers at the lower end of billing charges, will not have an increase of more than a certain amount. As these people who do not make many calls, would have a disproportionally higher phone bill after the disproportionate line rental increase, Eircom and Comreg came up with this mathematical miracle of the VUS.(Which by the way is failing all standards of consumer and competition demand).
As only so few people took up the scheme, I cannot understand how this could do the trick, it was intended for.
P.

SeaSide

Ripwave wrote:

Maybe the Government shouldn't give people money when they're on the dole either? It should contract with Brennans for a couple of hundred thousand loaves of bread every day, and Avonmore for a couple of hundred thousand cartons of milk?

If Johnson Mooney and O'Brien held a flour monopoly and Premier owned all the cows then yes. But as everyone has a choice of which bread or milk to buy there is no need to intervene in the market.

Ripwave wrote:

The benefit is aimed at individual. It's paid directly to the comms provider to simplify things, and minimise the hassle for everyone - the end user (who doesn't have to worry about it), the comms provider, who doesn't have to deal with bad debts on that part of the bill, and the Department, who only have a small number of providers to pay). They should get a massive discount, but that's a historical problem, dating back to the time that eircom was a semi-state anyway.

Agreed. But they wont get a massive discount unless there is competition. For there to be competition there has to be the potential of the business going elsewhere.

Ripwave wrote:

There would be no point in tendering for this service at this point, because no other land-line company can deliver a phone line without paying eircom for it - the margins just aren't there to make it worth the effort. Only alternative providers who didn't have to pay €20 to eircom out of the €20.40 the department provides would be interested. There should be some niche business for old folks homes (where the income from say 10 "social benefit packages" could be pooled to proved a VoIP service with free broadband, or a disocunt mobile package might be attractive). But having "Social Welfare Telecom" wouldn't be the best way forward, because it would just perpetuate the eircom dole, and wouldn't do anything to solve the problem of the exhorbitant line rental.

If you accept that as true there is no point in any telco offering any service to anyone. As there are alternative players in the market I would have to assume that they think there is a margin.

A 64m euro contract (268,000x20x12) is a pretty big pile of cash for any telco. It depends whether you think that 268,000 individuals can find a better deal for themselves or whether one organisation spending 64m will get better value. In the end the service the customer gets is the same but the taxpayer will not be sponsoring eircom to the same extent even if it is only 10%

Paddy20

DonegalMan wrote:

Paddy, are you absolutely sure this is right?

If so, then it is not an issue for IrelandOffline IMO but it is definitely something that deserves an almighty fuss - 'Eircom Pinches Cents from OAPS' - I can just see the headline!

I suggest that you and any others affected by this start making a fuss about it - contact local TD's to complain, contact local media, write to national newspapers highlighting it - I'm sure some of them will pick it up as a good story.

Martin,

Of course I am "Absolutely sure this is right". Also Imho it is an issue that IrelandOffline should take up on behalf of it's members who are in receipt of the free telephone line scheme.

Why, because if those in receipt of this free line rental, have not paid the €0.94c by the due date . Then they will be OFFLINE very quickly.

It should also be appreciated that the majority of the recipients of the "Free telephone line rental" scheme. Also need to use the Internet ! as much if not more than your average citizen, due to the fact that a large proportion are completely housebound and have no alternative other than to shop online. Many also live alone and the Internet is a great help in combating loneliness. Particularly,in isolated rural area's. Society has changed and the day's when people used to call on the housebound, gravely ill, elderly oap's etc, etc, have gone.

So, Imho IrelanOffline could and should campaign as well for these disadvantaged citizen's to be given:- subsidised Internet access, as an essential need/priority.

UTV Internet and UTV TALK currently have customers who are in receipt of the DSFA free line rental allowance, and the DSFA have agreed to pay the line rental fee direct to UTV Talk , but as usual Eircom are playing silly buggers and dragging their feet when it comes to handing over certain information to UTV Talk, even though the customer has signed over their instructions for the DSFA to start paying the allowance to UTV Talk and cease paying Eircom.

Apologie's for going on, but I do feel very strongly about this blatant Eircom scam.
Special note for Journalist's*
If any of the media wish to pick up this story. They can pick it up from here, or they can call me direct on <Please contact Ireland Offline for Paddy's number>. It certainly seems to be of substantial interest to IOFFL members at the moment ?..

DonegalMan

Paddy20 wrote:

Of course I am "Absolutely sure this is right".

Sorry Paddy, I didn't mean to sound as if I was doubting you, it sounded so outrageous that I just wanted to make sure it's not an error before we create a fuss about it. I've checked my Mother-In-Law's bill and you're quite right. Seems to have been in place for some months, it was April bill I checked (covering 25 April to 24 June). Am I right in saying that there was no notice given about this? - my MIL certainly didn't get any.

Also Imho it is an issue that IrelandOffline should take up on behalf of it's members who are in receipt of the free telephone line scheme.

Whilst I have a lot of sympathy with your points, I don't think it is an issue that IrelandOffline can take up directly but I am sure they won't ignore it

Apologie's for going on, but I do feel very strongly about this blatant Eircom scam.

I am just as pissed of with it as you are.

Martin

De Rebel

Paddy

This is a hugely important topic. Far more important that a lot of what hits this forum, and far more important than some of the posts in this thread. But I'm not sure IOFFL is the best agent/medium to tackle this issue. Let me explain.

I have a profound belief that this scheme is a good thing. It provides a lifeline and a security blanket for a huge number of people. The elderly, the disabled, single parents etc. And its not just about money. (and even if it was, the issue would still be important - there ARE people out there for whom One Euro is a significant sum). Sure, this scheme allows those who are marginalised and who live on the edges to keep in touch. It allows them to make and receive calls. And that’s important. But more important is the security blanket that it provides. The knowledge that they can make that essential call if they ever have to. And the hope that tomorrow the phone might ring....... The bill that ripwave posted early in this thread is typical. 7 calls in a month. 15 minutes in total. Most of the people who post to this forum would run that up of a wet Tuesday evening. But what was the value of those calls to that person? Probably priceless. Not to mention the benefit of the incoming calls. This scheme is socially enlightened, progressive and very egalitarian. It benefits a huge number of people way more than the apparent €100M per annum cost. Every time I see my parents make/receive a call to one of my overseas siblings I smile and thing that this scheme is one of the good things that come of the tax I pay.

And the scheme as announced only last year by the Minister for Social and Family Affairs was intended to pay the full cost. And psychologically, that’s very important, especially for the elderly who tend to be unduly concerned with budgeting. This press release sets out the stall. So somewhere along the way the Department dropped the ball.

This is one for the Minister for Social and Family Affairs to tackle as a matter of urgency. Given that he is paying the guts of €100m to eircom, he has a fair bit of negotiating strength. Seamus Brennan is not afraid to take a stand. You should make it your aim to convince him to do so. The scheme as launched by his predecessor was intended to cover the full cost, to provide certainty for the user. A decent round of negotiation, with some sharing of the costs/spoils should sort this out. The gap isn’t very large. With some give and take between the parties it should be possible to resolve. And if it isn’t, then the piper should call eircom’s bluff. The fact is they are cash starved and this is money for old rope. This is €100m in and almost zero attributable operating costs (installation is not covered). They cannot afford to have this income stream threatned. They really can’t.

Its my belief that IOFFL shines in making complex issues simple and subtly influencing the opinion makers. This topic need no interpretation and no subtlety. This is made for the Joe Duffy show. This is made of the average back bench TD. Paddy. I'd urge to put a call into Joe tomorrow, and ask him for his assistance in mobilising the elderly, the unwaged and the infirm to call their local TDs to get them to address this important issue. This is one for the grassroots. Its simple and easy to explain. Go for it. Call him and leave a message for him to call you back. Discuss it with him and his researchers off air first. And then go for the juggler. You have nothing to loose except your 94c eircom bill!

/edit: link corrected

Ripwave

De Rebel wrote:

The bill that ripwave posted early in this thread is typical. 7 calls in a month. 15 minutes in total.

Just to clarify - that wasn't the full bill - that 15 minutes was just the "free" €1.21 worth of calls provided in the package. There were another 100+ calls, totalling about €17 on the bill as well.

And the scheme as announced only last year by the Minister for Social and Family Affairs was intended to pay the full cost. And psychologically, that’s very important, especially for the elderly who tend to be unduly concerned with budgeting. This
press release sets out the stall. So somewhere along the way the Department dropped the ball.

You're mis-reading that press-release. That announced the modification of the existing scheme so that the Department would pay the allowance through any licensed land-line provider, not just eircom, as had been the case up to then (a historical anomaly, that the department was setting right). The press release simpley tells recipients of the allowance that they can now choose a provider other than eircom, and says that the value of the allowance is €20.41 a month plus VAT. It is entirely up to the providers how they package whatever they can offer for €20.41 plus VAT, and the press release gives some examples, and says that eircom is including €1 of calls.

The allowance wasn't increased when eircom increased it's line rental this year.

Ripwave

SeaSide wrote:

If you accept that as true there is no point in any telco offering any service to anyone. As there are alternative players in the market I would have to assume that they think there is a margin.

I've argued strongly that the government should be getting a lot more for it's money than it is now - at the very least, it should get a massive discount because it decreases eircoms bad debt concerns.

But there is no point in tendering for a service that can only be supplied by one company. The only way that any other company can supply a landline is to get that landline from eircom (for the vast majority of people in Ireland). And right now, the cost of "renting" that landline is almost as much as the allowance. Only realistic LLU pricing is likely to change that. (WLR isn't LLU).

A 64m euro contract (268,000x20x12) is a pretty big pile of cash for any telco. It depends whether you think that 268,000 individuals can find a better deal for themselves or whether one organisation spending 64m will get better value. In the end the service the customer gets is the same but the taxpayer will not be sponsoring eircom to the same extent even if it is only 10%

Compared to the €8 billion that has been mooted as the cost of delivering FTTH for the whole country, €64 million a year isn't even in the ball park.

Unless those 268,000 individuals can say to eircom "give us a discount, or we'll take our business elsewhere", then they aren't in a terribly strong position. And right now, you can't take your line rental business elsewhere - there isn't any choice! A "fixed mobile" package that included a handset, handset insurance, and say 250 minutes a month for the base price of the package might be ideal, but it would have to be offered on a locality by locality basis ("fixed mobile" would work in the immediate vicinity of your "home" base station, and would use a (01) type phone number, so that people calling you wouldn't have to pay mobile rates), which would prevent a centralised tendering process.

The Department has taken the first step, by liberalizing the rules for the benefit to allow provider other than eircom to participate. I'd absolutely love to see them put the squeeze on eircom somehow (at the very least by mailing all recipients at least once a year outlining the competing packages available), but I don't think that there's any point in them doing a national tender, at least in the current environment.

spongebob

Ripwave wrote:

A "fixed mobile" package that included a handset, handset insurance, and say 250 minutes a month for the base price of the package might be ideal, but it would have to be offered on a locality by locality basis ("fixed mobile" would work in the immediate vicinity of your "home" base station, and would use a (01) type phone number, so that people calling you wouldn't have to pay mobile rates), which would prevent a centralised tendering process.

It is strongly rumoured that O2 in Ireland have approached the Dept of Seamus Brennan with something very much along these lines and at a figure below €20 a month incl VAT .

M

eircomtribunal

Ripwave wrote:

But there is no point in tendering for a service that can only be supplied by one company. The only way that any other company can supply a landline is to get that landline from eircom (for the vast majority of people in Ireland). And right now, the cost of "renting" that landline is almost as much as the allowance. Only realistic LLU pricing is likely to change that. (WLR isn't LLU).

Unless those 268,000 individuals can say to eircom "give us a discount, or we'll take our business elsewhere", then they aren't in a terribly strong position. And right now, you can't take your line rental business elsewhere - there isn't any choice!

The problem is that Dermot/Comreg's single billing product is sold to the public as a successful whole sale line rental product, allegedly enabling competitors to compete with Eircom on the line rental front, when in reality they merely write the bills for Eircom.

I find it amazing that the Department press statement promotes Eircom with the 1 euro of free calls feature. How can a competitor manage to offer the single billing and undercut the 1 euro free call offer, when there is only a 10% margin in the whole-sale line rental product?
Inertia is legendary with telephone customers, even more so in the older age group.

Realistic LLU pricing is not in sight. Nobody can undercut Eircom's line rental with the newly suggested LLU pricing. LLU will only be usable for business customers or TV-bundling.

Ripwave wrote:

A "fixed mobile" package that included a handset, handset insurance, and say 250 minutes a month for the base price of the package might be ideal, but it would have to be offered on a locality by locality basis ("fixed mobile" would work in the immediate vicinity of your "home" base station, and would use a (01) type phone number, so that people calling you wouldn't have to pay mobile rates), which would prevent a centralised tendering process.

Basing mobile calls in the locality of the home on normal landline tariffs is a feature mobile operators offer in other countries. So no technical hindrances there. A mobile would as well have additional qualities for older people as it can double as a distress gadget.
Hate to see the mobile operators making the dosh.

P.

damien

eircomtribunal wrote:

How can a competitor manage to offer the single billing and undercut the 1 euro free call offer, when there is only a 10% margin in the whole-sale line rental product ?

Have we even heard any of the competitors complain about this recently ? If I was a competitor I'd be mouthing about this like Michael O'Leary.

shoegirl

damien.m wrote:

Wasn't the last line rental increase allowed because of eircom's "co-operation" with the VUS scheme ?

They agreed to this scheme and in turn they got their line rental ? So Eircom got a guaranteed 5 Million payment per month from the Govt and for them to accept this they were allowed a line rental increase ? Can someone verify this ?

You're right Damien.

And then they went and hid it in the most obscure part of the phone book so nobody could find it.

By the way the "Vulnerable User Scheme" is different from the Social Benefit Scheme. As far as I know the latter just pays line rental, well it did, until the line rental was hiked so high the Social Welfare was no longer willing to fully subsidise it.

The "Vulnerable User Scheme" is a cynical ploy by eircom to make a budget scheme so unattractive to users that they will not take it. Who wants to be a "vulnerable user?" Who sees themselves as a "Vulnerable user"? The genuinely vulnerable users are the ones already on the social benefit scheme so what this really is is eircom's excuse for a budget rental scheme that they are making unattractive so as to divert customers towards the normal package.

As somebody rightly pointed out, if the Social Welfare services decided to contract this out, it would be worth an enormous sum. The danger I see though, for these users, is it is more complicated to transfer to another line provider, quite simply because only eircom is obliged to provided services to everybody. Most other providers would probably not be particularly interested in low volume users who probably make few calls. And judging from eircom's expressed unhappiness at having to provide services to the non-filthy rich, they are likely to make a strong attempt to resist USP obligations over the next few years.

eircomtribunal

shoegirl wrote:

The "Vulnerable User Scheme" is a cynical ploy by eircom to make a budget scheme so unattractive to users that they will not take it.

In a response to the Oireachtas Committee about their 2 Nov 2004 hearing, I wrote to them about the VUS:

"Not least because I have high regards for your work, I start with criticizing you, the members of the Committee:

A) ComReg – Vulnerable User Scheme – Line Rental hike

After you successfully teased out the truth about the 23% line rental hike in your January meeting you made very valuable suggestions to ComReg, for example to change the VUS from a sign-up package to an automated billing feature.
ComReg deliberately removed the subcap on the lower quartile of bills, in order to allow Eircom to increase the line rental, believing Eircom who had told them that they were making a loss with the lines. ComReg replaced the sub cap – which if it had stayed in place would have reduced Eircom's ability to hike the line rental to 12% (as Eircom state in their SEC filing) – with the Vulnerable User Scheme (VUS), which they let Eircom design to be ineffective! – Eircom were able to hike the line rental by 23%, without any counterbalancing effect of the VUS, which is a total farce in many aspects (not advertised, not automatically implemented in the bills which fall under its modalities, not transparent for the consumer in its pricing structure, anticompetitive as only Eircom work it). ComReg did nothing since to protect the lower bill payers. Nothing has happened with the VUS charade. Most of the low bill payers are within the group of Telephone Allowance Scheme recipients and their bill hike of up to 23% is mostly paid for by the Dep. of Social and Family Affairs, whose payment went up to 92 million/year, the vast majority of it directly going to Eircom.
While the Committee had highlighted this farce and Doherty/Goggins left with egg on their faces (only 300 to 400 VUS subscribers!) and vague promises, the Nov 2004 hearing of the Committee completely ignored/forgot to follow up with any questions on progress with this issue to John Doherty.

Questions:
How high was the overall bill rise on the lower quartile of bill payers?
How many people have taken up the Vulnerable User Scheme to date? What is ComReg doing to prevent another line rental increase, which will again hit the low users most?
What is ComReg doing to bring Irish Telephone line rental into line with the EU average?"

I am looking forward to any response from the Committee members.
P.

Paddy20

Surprising update;

Got a hard copy bill from EirCoN for my line rental today. Instead of it demanding a payment of €0.94c from me.

It actually shows my account in credit to the tune of -€1.60c :eek: It appears that the Government department that is responsible for paying my telephone line rental charge in full, is now actually doing so !, No thanks to Minister Mary Coughlan T.D.

This very welcome surprise which must obviously hopefully apply to all Free Telephone Rental Allowance recipients, is clearly another feather in the cap of IrelandOffline's voluntary Committee, Martin Harran's work and the publicity recently given to the injustice by Mr Jamie Smyth of The Irish Times.

Many sincere thanks to all who helped Martin [Donegalman] behind the scenes.

Nice to know we still have some who give a damn left in Ireland

P.

MarVeL

So who blinked? Eircom or the government, and why do I have the sinkng feeling in my stomach that this means however high ericom put the charges the government will pay them. I agree with the concept of free phone lines for those who need them I just wish that the goernment had renegotiated the deal with eircom.

Can these lines be moved to a different provider?

Paddy20

MarVel,

The Government blinked and are now it seem's paying the free telephone rental allowance in full, in accordance with the legislation on the issue.

However, I do agree with you that it would have been much more logical if the Government had " Re-negotiated the deal with Eircom ". I believe they really had EirCoN over a barrel on this one, and could have easily obtained a more acceptable compromise.

As for your query; " Can these line's be moved to a different provider ? ". The answer is yes , the payment's for free line rental charge's will be paid direct to any ISP either Monthly or Bi-Monthly, provided the recipient has signed a consent form.

All the best.

P.