Smart 3G decision next Tuesday

crawler

Court to rule on Smart appeal

By Vivion Kilfeather
THE High Court will give judgment next week on Smart Telecom’s bid to overturn the decision of the Commission for Communciations Regulation not to grant it the lucrative 3G mobile phone licence.


The case before Mr Justice Peter Kelly was heard over 14 days and he reserved judgment. His decision will be given next Tuesday.

Smart Telecom brought the proceedings after ComReg’s decision last February not to award the licence to Smart Mobile Limited because of what ComReg claimed was a failure by Smart to provide the €100 million performance guarantee bond in a form acceptable to it within the specified deadline.

http://www.irishexaminer.com/irishexaminer/pages/story.aspx-qqqg=business-qqqm=business-qqqa=business-qqqid=16727-qqqx=1.asp

Liam Byrne

So Smart "fail to provide" stuff to ComReg "in an acceptable format" "by a specified deadline" and get a licence pulled.

If you check ComReg's website you'll see lots of reports about LLU, GLUMP and fault corrections where eircom have "failed to provide"...."by a specific deadline".

Not saying it's right for either telco to do things wrong or miss important deadlines, but surely be to God there's something amiss if one telco ends up in court to reclaim what they'd previously been offered while the other goes on its merry way without consequence ?

1huge1

eircom have comreg around their little finger
its a disgrace

paulm17781

I'm somewhat anxious about this. If Smart lose the license I would think it is goodbye Smart. This judgement will have wide ranging implications on the Irish telecoms market.

JohnC.

What is the situation with Smart now? Are they getting rid of phones and just doing broadband, which was one thing I heard? All the mistruths from eircom and rumours from other places makes it confusing.

So basically, if they do win this case, are they still in a position to actually do something with it?

paulm17781

Smart are dropping their CPS voice product. Broadband customers will still get voice services from them.

If they get the license it will turn around their fortunes greatly. There will be a large amount of investors behind a new mobile operation.

Liam Byrne

To translate paulm17781, they're dumping their phone-only packages (which was basically reselling you eircom's product, and which probably made SFA income considering they were paying eircom wholesale prices for the lines) and concentrating on offering their own products, which includes combined phone + broadband and the SmartVision product.

Don't expect eircom's ads to clarify this for you, though.....they (and some newspaper articles and radio programmes) are also guilty for giving incorrect details regarding Smart's "demise".

The main reason the 3G licence is so important to them is because it's very difficult for them to get people to sign up for their phone + broadband packages (despite the price and the much-superior package) because, courtesy of eircom, most people and businesses have to change their phone number, which they are obviously reluctant to do.

And since ComReg want the 3G licence back, a weaker Smart is an easier opponent, so I can't see ComReg forcing eircom to implement LLU + GLUMP (allowing you to change provider without changing number) until ComReg have the 3G licence back.

It stinks, but hey, welcome to Ireland.....

bealtine

Liam Byrne wrote:

T

And since ComReg want the 3G licence back, .

they want to give it to eircom

Foxwood

paulm17781 wrote:

I'm somewhat anxious about this. If Smart lose the license I would think it is goodbye Smart. This judgement will have wide ranging implications on the Irish telecoms market.

Smart has already written off their legal costs from this case, and Brendan Murtagh wouldn't be able to buy the company for €1 if the major shareholders had high expectations that the company would be holding a 3G license shortly after he buys them out.

dahamsta

Smart were out of cash and out of borrowing options, they didn't have a choice.

watty

Foxwood wrote:

Smart has already written off their legal costs from this case, and Brendan Murtagh wouldn't be able to buy the company for €1 if the major shareholders had high expectations that the company would be holding a 3G license shortly after he buys them out.

Murtagh will be paying 40,000,001 Euro as he then is reponsible for the debt.

paulm17781

Foxwood wrote:

Smart has already written off their legal costs from this case, and Brendan Murtagh wouldn't be able to buy the company for €1 if the major shareholders had high expectations that the company would be holding a 3G license shortly after he buys them out.

While I agree with this. I can't see why he would buy them otherwise....

Liam Byrne

bealtine wrote:

they want to give it to eircom

I (and thousands of others) suspect that this is indeed the case, but there's no definite proof that it's the case.

The eircom/ComReg/Smart fiasco might give ComReg an excuse to do just this, though, stating viability concerns as their judgement criteria.

Oddly enough, many newspapers at the weekend highlighted that Smart were in credit with eircom when eircom pulled the plug......didn't hear many radio stations or other sources pick up on it, though.....

While I would view as important the viability of whatever company gets the 3G licence, bear in mind that Smart were already awarded it - as it stands, it is theirs - I'd also like to see Smart retain it for a number of reasons, not least what they achieved in the broadband market against all the odds, and if you factor in what their package and pricing forced others to do, their approach would be a seriously welcome addition to the marketplace in terms of quality and value.

govinda

And its official, Smart lose the licence:

http://www.rte.ie/business/2006/1031/smart.html

daveyjoe

govinda wrote:

And its official, Smart lose the licence:

http://www.rte.ie/business/2006/1031/smart.html

I'm disapointed but not at all surprised. Smart are the only competitive telco operator in the Irish marketplace (Perhaps magnet will step up to the plate now?).

If their licence doesn't go to eircom then I'll eat my hat! This whole affair leaves a very sour taste in my mouth.

WizZard

What will happen the license now? Another auction/lottery or something?

Cabaal

WizZard wrote:

What will happen the license now? Another auction/lottery or something?

Nope, it'll be awarded to Eircom/Meteor
:mad:

Liam Byrne

****e! :mad:

At least there's some good news in that article, in that Brendan Murtagh's bid got the all-clear and Smart are still in business......

Cabaal wrote:

Nope, it'll be awarded to Eircom/Meteor

Cabaal, is that definite, or are you just assuming like the rest of us, that it's a done deal ?

crawler

I think the rules of the competition would mean that if the Smart bid was invalid, then it would actually have to be offered to the next placed bidder (as they would now be the highest bidder)

WizZard

Which, naturally, would be eircom/Meteor?
Hmmm...

JohnC.

Perhaps I should be purchasing a tin foil hat, as that is one conspiracy I can easily believe in.

crawler

Comreg comment here

http://www.comreg.ie/_fileupload/publications/PR311006.pdf

I would think that they will now offer the license to the next placed bidder, who may or may not accept it. Terms and conditions apply, your home is at risk if you do not keep up etc etc etc

dahamsta

Well, at least now we have stick to beat ComReg with when Eircom misses their deadlines?

Liam Byrne

I smell an even bigger rat than I originally thought:

ComReg report on LLU & GLUMP : "At this juncture, the facility is primarily being utilised by Magnet Entertainment and orders are progressing, albeit at relatively low volumes."

No mention of Smart there, despite it being mentioned in the previous report in August:

"3 LLU operators are actively providing LLU based services to customers, namely, BT Ireland, Magnet Entertainment and Smart Telecom."

And today's grab-back of the licence is very harsh for non-compliance, considering that eircom haven't bothered complying with any of ComReg's requests (just scan through the ComReg website documents re GLUMP, LLU and Faults and count the number of times "not acceptable" appears).

probe

Eircom is in control of everything in its territory – Comreg, the political process, even, it would appear, the legal system. eircom wants Smart’s 3G license – eircom gets smart’s 3G license.

The “establishment” can CYA themselves with conditions and small print, but the bottom line is that if Smart had it’s 3G license confirmed today, the required funding and expertise would have chased the company to come on-board from multiple sources, as per the Digifone experience. The mobile market would have got more competitive. And broadband would have become more competitive as a result.

Instead, all we get is another nail in the coffin of a competitive telecommunications marketplace.


.probe

Hornet

probe wrote:

if Smart had it’s 3G license confirmed today, the required funding and expertise would have chased the company to come on-board from multiple sources, as per the Digifone experience.

I have doubt that it would have been similar to the Digifone times. Back when Digifone got the licence it was the gold digger times of mobile phone business. Now things have changed. The mobile phone penetration is such that a mobile phone licence is not anymore a guarantee to success. The required market share has to be acquired through tough price competition and Vodafone and Telefonica would definitely have more power in such a competitive environment.

In fact it seems that both Smart management and the investors were hoping to replicate the Digifone story of emerging like Phoenix from the ashes of bankruptcy. They seem to forget that the market conditions have changed SUBSTANTIALLY.

The mobile market would have got more competitive. And broadband would have become more competitive as a result.

I don't see the direct link here.

Yes, the mobile market would have got more competitive, but as Eircom will have to win market share as well, they might have to find a competitive side as well! Keep in mind that the P&T/Telecom Eireann mindset that turned Eircom in this so emotionally criticised company is in the heads of the OLD employees (and there will be less and less of them). All new (post-Telecom Eireann) employees and probably the large majority of the new Eircom Mobile employees will have NOTHING to do with the old Telecom Eireann days, but will just behave like all large corporates that have an strong position. Greedy, arrogant, and ignorant as much as possible to the end users.

Why broadband would have become more competitive, however, I can't see. Smart would have been under serious financial pressure during the build-up process and for a long time of the service roll-out. A financial pressure and situation that the Smart management hasn't handled well up to now.

--Hornet

JohnC.

Hornet wrote:

Yes, the mobile market would have got more competitive, but as Eircom will have to win market share as well, they might have to find a competitive side as well!

Don't they already have market share in the form of Meteor?

watty

Meteor 2G.

kaizersoze

Hornet wrote:

Why broadband would have become more competitive, however, I can't see.

Mobile broadband akin to what Vodafone are offering now I presume.

Solair

Well Eircom Mobile / Meteor is a small player in a very different position to eircom fixedline business.

The key thing that ComReg needs to do in the mobile sector is to get these Virtual Mobile Operator licences up and running asap.

At least our mobile duopoly is being taken on by Meteor and 3 very different to the landline situation.

It's a pity that Smart have had it so tough. But, it probabally makes sense to have meteor in a position where it can offer 3G services in terms of encouraging good competition.

Otherwise, meteor would have been limited to voice and slow data. It would have given Voda and O2 a huge advantage.

3, having a 3G only licence, can still push forward with 3G services.

Meteor would have been left as a 2.5G network for ever.

The more networks with 3G up and running, the more likely we'll see some interesting products.
So far, nothing very innovative has been launched in Ireland and I really don't think mobile phone browser based TV and video calling will be the "killer aps"

Undoubtedly eircom's the bully in the fixed line market. However, it's an absolute mino in the mobile market thesedays.

Vodafone in particular makes eircom look like a corner shop standing beside a Tesco Extra hypermarket.

bealtine

Solair wrote:

Meteor would have been left as a 2.5G network for ever.

I fail to see the reason why Meteor was not simply allowed to upgrade their network to 3G. (Licensing issues aside)

Solair wrote:

Vodafone in particular makes eircom look like a corner shop standing beside a Tesco Extra hypermarket.

And we all know how good Tesco are for business, overpriced, rude and understocked.

Solair

bealtine wrote:

I fail to see the reason why Meteor was not simply allowed to upgrade their network to 3G. (Licensing issues aside)

Let's not forget it's ComReg we're talking about!:D

bealtine

Solair wrote:

Let's not forget it's ComReg we're talking about!:D

Exactly, this regulator seems to be destroying the telecommunications industry with its illogical decisions, based on perhaps the phases of the moon?
Heavy handed regulation on the little guys and little or no regulation for the big boys...

People broadcasting mass get the full treatment of the law...and blatant disregard for the laws by others are utterly ignored...

Almost all decisions seem to have an underlying and hidden motivation. Perhaps it is consolidation of monopoly??

ednwireland

why does everyone see smart as the good guy they owed 40 million euro for f**ks sake. if i ran eircom i would have done the same they had no hope of getting paid issued numerous warnings to smart etc etc. yes comreg are a shower but smart have brought this on themselves pure and simple. see loads of companies burn through cash at a phenomal rate even worked for one and the basic problem is directors beleive their on hype they obviously didnt have products that made enough money to support their business strategy. i for one ont lose sleep over smart going to the wall

bealtine

ednwireland wrote:

why does everyone see smart as the good guy they owed 40 million euro for f**ks sake. i

Gosh that is terrible, imagine owing 4 million or so...

Now I get worried when I think about eircom and them owing a mere 4 BILLION or so.
So what was that bit again about "products that made enough money"?

Liam Byrne

ednwireland, you've taken the "zeros mean nothing" to new levels.....if there's a digit before them that doesn't apply, so owing "40 million" is not the same as owing "4 million".

As bealtine said, owing money is not an issue in business, as long as you owe it to the right people (banks, investors, venture capitalists)....Smart's mistake (even though they had no option) was that they owed it to the one competitor who was scared ****less to see them doing a decent job on competition and could (and was willing to) pull enough strings to do more than just ensure they got paid; eircom were more interested in closing Smart and losing that money than merely trying to get paid.

Recent news reports disputed eircom's figures, saying Smart were in credit.....but even aside from that, remember (again) that eircom didn't do the job they were to be paid for - LLU and number portability.

If a builder only does some of the things you ask him, do you pay him in full, or do you hold out in the hope that he'll finish the job properly ?

bealtine

Liam Byrne wrote:

Recent news reports disputed eircom's figures, saying Smart were in credit.....but even aside from that, remember (again) that eircom didn't do the job they were to be paid for - LLU and number portability.

eircoms's play was transparent, create a rumpus about Smart, make them look like losers and then get their 3g license and as a benefit make the LLU process look decidedly dodgy.
Hopefully (in their estimation) this play would stall LLU for a long time to come.

Solair

Well I suppose that's what you get for setting up a toothless regulator with no imagination