ODTR respond to Eircom

Mountjoy Mugger

http://www.odtr.ie/docs/pres130901.doc

Any delay in the launch date may be expected to be short but it is ultimately within the control of eircom.

Hmm..

Kix

Fair enough. The Regulastor knows those prices are taking the proverbial.

K

Fergus2

Grand.. looking forward so to the imposed correct price and subsequent court case

Urban Weigl

The ODTR should set a wholesale price of IR£20-30, thus allowing competitors to offer the service at or under 40 punts. This should then force Eircom to reduce its own prices.

What is also needed is a DYI installation kit, allowing users have the option to plug in their ADSL equipment themselves (this has been done elsewhere with success. The only reason Eircom might not want to do it is if they want to stall the rollout of ADSL services).

nahdoic

Originally posted by Urban Weigl
The ODTR should set a wholesale price of IR£ 20 - 30, thus meaning that competitors can offer the service at or under 40 pounds. This should then force Eircom to reduce its own prices.

if only.

kamobe

"The ODTR should set a wholesale price of IR£20-30"

They *should*, but can they? Do they have the power to set a price? Or can they just reject Eircoms proposals?

DeVore

And so it begins...

DeV.

ando

The Regulator has issued a number of directions to the company which eircom must comply with by close of business on Monday 17th September. Eircom has also been directed that any launch date for provision of service must be at least 21 days after satisfactory compliance with these directions

The way I read this is:

The ODTR is pi$$ed off with €ircom and is now forcing €ircom to agree with this new wholesale pricing structure (Directions), and that €ircom have to agree to it by Monday. If they do agree, then they cannot offer ADSL for at least 3 weeks after the agreement has been made, which will in effect, will delay ADSL launch date till the 8th of October. Am I right in saying that €ircom cannot launch ADSL on the 28th september ? and we'll all have to wait until october 8th ?

ando

Mountjoy Mugger

If Eircom accept ODTR's proposals (provided they're reasonable), I for one would have no problems waiting another week, or another month for that.

dahamsta

"The ODTR should set a wholesale price of IR£20-30"

They *should*, but can they? Do they have the power to set a price? Or can they just reject Eircoms proposals?

Not really. Yes.

The ODTR is not inclined to get involved in retail pricing, she tends to aim more for wholesale pricing to promote competition. In a more competitive market, she would be completely justified in that, but I'm not sure it's appropriate in this particular market. That said, I don't really know if her methodology is dictated by legal bonds or just a disinclination to act as "that kind of regulator".

This is a complex situtation now though. On the one hand, you could say the ODTR has the upper hand, in that they can embarrass Eircon slightly because they've already "launched" the service publicly. On the other hand, Eircon aren't exactly demonstrating a commitment to supplying DSL services, so it's quite possible they're still "playing the game".

I'm very pleased with this announcement from the ODTR, but I hope they will act quickly and intelligently to resolve the situation in a timely manner, and not let Eircon stall too much.

adam

SkepticOne

Originally posted by dahamsta

The ODTR is not inclined to get involved in retail pricing, she tends to aim more for wholesale pricing to promote competition. In a more competitive market, she would be completely justified in that, but I'm not sure it's appropriate in this particular market. That said, I don't really know if her methodology is dictated by legal bonds or just a disinclination to act as "that kind of regulator".[/B]

After their recent press release, I'm not sure where the ODTR are coming from. What, for example, do they mean by this: "The relationship between wholesale and retail rates appears inconsistent. The effect may be that other operators could not buy the wholesale product and use it to compete with eircom."? This allowed a spokesman in a recent article to say that since their retail prices were so high (they don't mind admitting it), there should not be a problem with their margins.

To the ODTR: Forget Eircom's margin. The bottom line is wholesale prices. If these are low enough then other suppliers may be interested in entering the market. At present, I can't imagine any ISP paying £50 per month for ADSL given that a small profit margin and VAT will push it above £80. How many customers are they going to get at this level? If margins were the problem, then all Eircom would have to do is further raise their retail price so the margin is greater. That would have the effect of destroying the ADSL market in Ireland but it would not be a big problem for eircom because they would continue to make money by charging by the minute for ISDN and PSTN internet access. Eircom have pretty much the monopoly on these.

It is a dificult situation for the ODTR. On the one hand, by imposing a low wholesale price, Eircom could simply not provide ADSL or they might not roll out the product beyond the trial exchanges. By allowing a high wholesale price, Eircom gets to dominate the market and users are forced to put up with high retail prices. Is there a compromise? Maybe not. It is possible there is no overlap between wholesale pricing that might encourage OLOs and that would protect Eircom's profits. Eircom, like any business, are not interested in anything that will impact negatively on their profits and they have no obligation, as far as I can see, to bother with ADSL at all.

This is a complex situtation now though. On the one hand, you could say the ODTR has the upper hand, in that they can embarrass Eircon slightly because they've already "launched" the service publicly. On the other hand, Eircon aren't exactly demonstrating a commitment to supplying DSL services, so it's quite possible they're still "playing the game".

I tend to agree with the second bit. Eircom seem quite happy to blame the ODTR indefinately for lack of ADSL. They have been doing this for some time now. I believe that telcos only became interested in ADSL in the first place because of the threat of competition from cable companies. A threat, thanks to the ODTR, which doesn't exist here.

JANER

I just phoned Brghid smyth from the ODTR and i found her to be most polite and helpful.
Anyway i told her that in England(where they have compitition) that it is £40 UNLIMITED per month.....

I am really pissed at the £100 price but i just could not believe when i heard that it was CAPPED to 3 gigs a month
i mean i am a games player(at 37) and ffs i am online so much......:mad: