[Irish Times]Eircom says State wasting money

viking

Seems as though Eircom are threatening to complain to the European Commission following the awarding of the MSE contract to their subsiduary. They reckon the government is duplicating Eircom's networks by building MAN's, even though Eircom themselves are involved in the managing of these "duplicate" networks.

I'm sorry but this stinks real bad. I don't disagree with the MAN's but Eircom would be in a more credible position to complain if they sold their stake (35 per cent) in TE Services, rather than looking like fools with their fingers in both pies...

Eircom yesterday accused the Government of squandering €170 million of public money amid a growing rift over the direction of the State's telecoms policy, writes Jamie Smyth, Technology Reporter

The firm, which holds a near monopoly over telecoms infrastructure in the Republic, also signalled that it may complain to the European Commission about State intervention in the market.

Eircom spoke out following the award of a contract to manage a new State-owned fibre-optic telecommunications network in 19 regional towns. The contract, won by Limerick-based E-Net, will enable Eircom's rivals to bypass parts of its network to supply services in many regional locations.

E-Net, which was founded by Limerick developer Mr Michael Tiernan, will market and maintain the State-owned network for the Government. It will be a profit-making enterprise, sharing the revenue generated from the networks with the State.

The firm expects to create 65 jobs throughout the 15-year lifetime of the management contract and provide indirect employment to another 55 people. One of its primary goals will be to provide better infrastructure in regional areas to attract more investment, Mr Tiernan said at the launch.

Ion Equity and PricewaterhouseCoopers recently raised €12 million for E-Net from ACT Venture Capital, Bank of Ireland and Anglo Irish Bank. The firm's chairman is Mr Eoin O'Driscoll, a former Lucent director.

The Minister for Communications, Mr Ahern, described the initiative as a unique public private partnership yesterday and said the Government would fund new fibre networks in 41 towns. He said the funding for these projects had been secured from the Department of Finance despite opposition to the project from some outside Government.

Mr Ahern said the new network and the management contract would both complement and extend very significantly the accelerated roll-out of broadband infrastructure to regional areas.

Eircom strongly rejected Mr Ahern's comments last night and accused the State of wasting taxpayers' money by duplicating its network in regional locations.

Mr David McRedmond, Eircom's commercial director, said State policy would undermine the case for future investment by private firms like Eircom. "We are already providing broadband to 60 of the 65 towns where the Government is planning to build networks. I think there is potential for another Global Crossing experience where the State ends up writing off millions of euro."

In response to Eircom's statement, a spokesman for Mr Ahern said the Government would make no apology for ensuring there wasn't a digital divide in the Republic in areas where firms didn't invest.

© The Irish Times

oscarBravo

I typed a reply to this, but it's probably just as well I took a short walk before I hit the "Submit" button - I'd hate IrelandOffline to be the first board I'm ever banned from.

Here's the polite version: someone should ask Eircom to quote for a connection to their fibre-optic metropolitan ring in (say) Ballina. Their answer should put paid to any talk of duplicate networks.

shinzon

Originally posted by oscarBravo
I typed a reply to this, but it's probably just as well I took a short walk before I hit the "Submit" button - I'd hate IrelandOffline to be the first board I'm ever banned from.

Here's the polite version: someone should ask Eircom to quote for a connection to their fibre-optic metropolitan ring in (say) Ballina. Their answer should put paid to any talk of duplicate networks.

they probably wouldnt know there was a fibre ring in ballina to begin with

I cant believe the cheek of eircom sometimes i really dont


Shin

Sleipnir

yeah but there's money to be lost & their strangle-hold over the country will ease a bit.
Can't let that happen.

por

Did anyone hear David McRedmond on the Last Word on Today FM talking about this yesterday. I missed it.

viking

Originally posted by por
Did anyone hear David McRedmond on the Last Word on Today FM talking about this yesterday. I missed it.

Yes and it was disappointing that TodayFM did not have someone to represent the other side of the argument.

Essentially, Mr McRedmond repeated everything that he said in the Irish Times article about network duplication, wasting of state funds etc.

Matt Cooper failed to ask any probing questions about eircom's large shareholding in one of the companies involved in the consortium to manage the MAN's.

It was disappointing really that it was such a one sided piece.

viking

dahamsta

Originally posted by viking
Yes and it was disappointing that TodayFM did not have someone to represent the other side of the argument.

This is par for the course with Eircom and has been for quite some time. McRedmond and his predecessors don't have the balls or the brains to defend themselves, mostly because nearly everything they do is indefensible. Eircom's policy on interviews is well known, the media should refuse to accept the terms. In other words, Cooper's a big fairy too for letting them get away with it.

adam

spongebob

Any interviewer who is not seriously scrotally challenged would point out to Eirocm that they receive a VAST Governemnt subsidy from the Department of Social Welfare every month. Its Time this was withdrawn and properly tendered out and opened up to all carriers . In October 2003, before Eircom raised their line rental yet again, they were in receipt of a government subsidy of some €6 Million a month or €72 Million a year....ex VAT. The line rental hike in January would have brought this subsidy up to about €80 Million A Year .

Details on that illegal (under EU law) subsidy are Here should one wish to bitch slap journos who uncritically carry guff from Eircom about 'subsidies' .....the usual suspects of course

If I had a choice between allowing McRedmond to trouser €80 Million of public funds or to spend about the same amount building out an alternative I know what I'd do. Send Matt Cooper over to me for the injection

M

eircomtribunal

There's a Eamon Quinn article in todays sunday business post on how Eircom will make profits from the "dublicity" it is bemoaning.

http://www.sbpost.ie/web/DocumentView/did-720649868-pageUrl--2FThe-Newspaper-2FSundays-Paper-2FNews.asp


"Eircom gets around broadband ban


04/07/04 00:00


By Eamon Quinn
Eircom will profit from a major contract to run the country's new €70 million broadband network, even though it was banned from bidding to run the network.
TE Services, which is 35 per cent owned by Eircom and controlled by an offshore shell company in Jersey, is the main contractor to E-net, which was awarded the management contract last week.

The Sunday Business Post has established that TE Services has an exceptional shareholder agreement by which Eircom is entitled to receive a percentage of its revenues.

The agreement gives Eircom greater control over TE Services than its stake would suggest.


TE Services was formed in 1999 by ex-Eircom employees and has depended on Eircom for up to 90 per cent of its revenues by maintaining lines, repairing line faults and connecting customers to Eircom's network.

E-net, based in Limerick, won the contract to manage fibre-optic metropolitan area networks, on which the government has spent €70 million.

As main contractor to E-net, TE Services will receive up to €2 million a year.

The previously-undisclosed special shareholder agreement between Eircom and TE Services is operated through TE Services Ireland. TE Services Ireland is, in turn, 65 per cent-owned by TE Investments, a Jersey company owned by TE Services founder Pat Gardiner and other investors.

Eircom owns the stake by controlling convertible cumulative participating preferred ordinary shares in TE Services Ireland. The shares give Eircom a right to a percentage of revenues earned by TE Services from work it carries out on Eircom's access network.

TE Services has been in talks about selling a 60 per cent stake to AWG Group, a British stock market company.

The deal would value TE Services at more than €10 million.

If the sale were completed, Eircom would retain a 30 per cent stake in TE Services, while employees would own 10 per cent through an employee share ownership trust."