Worth an award: S.T. business editor talks through his arse

eircomtribunal

This should easily fetch an award for most "stupid article of the year" so far:
Sunday Times business editor Brian Carey has finally found why we are not taking up broadband, despite it being available "across 85% of the country": Because stupid ComReg won a hollow victory over Eircom, forcing it to introduce such a low flat-rate dial up rate (of €9 per month) that this now acts as a disincentive to broadband take-up. I am not kidding. I'll quote the whole article in today's Sunday Times:

The Sunday Times - Business March 12, 2006

And Finally ... Can Babcock & Brown knock some sense into ComReg?
Brian Carey

AUSSIE investment bank Babcock & Brown wants to take over Eircom and right all the wrongs inflicted on the Irish people by the former state telecom company over the past seven years.
Split the evil beast. Invest in a network company, so that high-capacity fibre will run into every home, opening up a whole plethora of services. Sell the retail division, so that competition — fair and free — can flourish. A brave new world, no less, in the guise of a €2.4 billion takeover.

Sadly, telecoms in this country is no morality tale.

It is glib simply to blame the privatisation of Eircom or indeed its sale of the national telecom network to venture capitalists in 2001 for poor broadband take-up. The real problem with the Irish telecom industry is the long-standing and highly adversarial relationship that exists between Eircom and ComReg, and between the department of communications and Eircom.

Since its inception the communications regulator has held firm to the noble cause of reducing the cost of telecoms here. It has served the country well.

Eircom has maintained that promoting investment in its network and operating a pricing regime that once demanded cuts in tariffs of 5-6% a year were simply not compatible. Whether owned by venture capitalists or capped ventriloquists, the owners of a telecom network demand a return.

But what class of a return? One that rewards bloated payroll and inherent inefficiencies? Government suspicion of Eircom’s “return” is so deep it has spent €80m of taxpayers’ money constructing an alternative telecom network for a mere 4,000 subscribers.

The fundamental conflict between pricing and investment return remains unresolved. One of the great ComReg victories of the past was getting Eircom to offer flat-rate dial-up internet at cost. The dial-up rate is now so low, at about €9 a month, it acts as a disincentive to switching to broadband. There is broadband coverage across 85% of the country. There are almost three times as many dial-up customers.

The broadband debate blathers on, like some wearisome and noisy pub argument, with little or no clear thinking.[How right you are Brian!] Maybe the fresh Babcock & Brown approach will bring a resolution to the conflict, and an end to the decade of distrust. Splitting the network and retail arms is a good start. The Australians also promise more investment in the network.

But the inevitable consequence of higher investment will be higher prices. It will be interesting to see how that will that go down with the rest of the market, the government and ComReg.

P.

P.S.: Would a few people care to write to the Sunday Times?

jmcc

eircomtribunal wrote:

This should easily fetch an award for most "stupid article of the year" so far:

I'm not so sure. There is a well known problem facing new players in subscription based businesses: the reluctance of subscribers to switch to another provider. With broadband, the problem of new equipment is added. So it can be a hard sell if someone is content with flatrate dialup. The 85% coverage is probably Eircom propaganda but figures can be misleading. To make sense of those figures, you would need to see computer ownership figures in parallel with an area by area breakdown.

Then you have to take the ages of the computers and operating system versions into consideration. If someone has a working solution and it does all that they want to do, they may not want to upgrade.

I've seen many stupid articles, mainly from technology journalists who haven't a clue about technology. This is a business article and some of the points are sound and even smart. The 85% coverage is probably the weakest and most questionable aspect of it.

Regards...jmcc

zuma

The dial-up rate is now so low, at about €9 a month, it acts as a disincentive to switching to broadband.


Clearly the writer of this article should never be allowed to use a connection any faster than 56Kbit/s(6KBytes/s MAX!) for the next 12months and see how great it is then!!!

watty

So why are people spending over 50 Euro on Dialup if it is only 9 Euro a month?

Where is this magical unlimited access 9 EURO a month that Comreg won for the customers?

Stan 10

watty wrote:

So why are people spending over 50 Euro on Dialup if it is only 9 Euro a month?

Where is this magical unlimited access 9 EURO a month that Comreg won for the customers?

You can get 30 hours anytime peak or offpeak for €9.99 per month on UTV Internet .But I agree with your general point

watty

So how much does 120 Hrs cost? 30hrs is only 1 week, part time at that.

It's hardly flat rate.

BrianD

Ask hime will the Sunday Times take advantage of an obvious cost saving to be made by switching over to a dial-up? By switching over they could increase the budget for boosey lunches!

Stan 10

watty wrote:

So how much does 120 Hrs cost? 30hrs is only 1 week, part time at that.

It's hardly flat rate.

180 hours flat rate Internet access ANYTIME, day or night for just €24.95 per month!

Does that answer your Question?

dahamsta

BrianD wrote:

Ask hime will the Sunday Times take advantage of an obvious cost saving to be made by switching over to a dial-up?

Heh.

paulm17781

Stan 10 wrote:

180 hours flat rate Internet access ANYTIME, day or night for just €24.95 per month!

Does that answer your Question?

Hardly 'Flat-rate' though is it? There are more than 180hrs in a month. There certainly isn't 'Flat-rate' for €9 per month.

GP

jmcc wrote:

I'm not so sure. There is a well known problem facing new players in subscription based businesses: the reluctance of subscribers to switch to another provider. With broadband, the problem of new equipment is added. So it can be a hard sell if someone is content with flatrate dialup. The 85% coverage is probably Eircom propaganda but figures can be misleading. To make sense of those figures, you would need to see computer ownership figures in parallel with an area by area breakdown.

Then you have to take the ages of the computers and operating system versions into consideration. If someone has a working solution and it does all that they want to do, they may not want to upgrade.

I've seen many stupid articles, mainly from technology journalists who haven't a clue about technology. This is a business article and some of the points are sound and even smart. The 85% coverage is probably the weakest and most questionable aspect of it.

Regards...jmcc

when they say 85% of the country do they mean 85% of the country that comprises of Dublin city , Cork city, etc etc?

I live 7miles form Wexford town and there's not even a sniff of access and probably wont be for the next 10 years.

BrianD

Maybe they are using the coverage that mobile operators like to use - population coverage as opposed to geographic coverage?

zuma

They are only using population coverage.....if they used Geographic coverage then the figure would be about 10% coverage.....hahaha!!

The Real B-man

All these Gimp Editors getting there false info off Comreg but in all fairness arent they suppose to believe what they read off the national communications regulatory commission?? i would to if i didnt know the actual situation with Broadband in this country

MUPPETS!

watty

zuma wrote:

They are only using population coverage.....if they used Geographic coverage then the figure would be about 10% coverage.....hahaha!!

it isn't even population coverage. It's exchanges assuming that EVERYONE on the exchange will get working adsl. Only a proportion of lines will. Some exchanges a tiny proportion.

eircomtribunal

Damien Kibert has more sense and knowledge about the Eircom situation than his colleague showed to have last Sunday. In his Sunday Times column today he discusses the privatisation of State companies and has this to say on the Eircom story:

Bizarrely, we embraced the sale of Telecom Eireann (now Eircom) some years ago without analysing the strategic implications at all. The company has already been cleaned out of cash once by venture capitalists and the process may be about to recur.

But we have no say in the matter because we opted to sell it unconditionally.

We now find that less than than 5% of the population is wired up to broadband and that the level of capital being invested in Eircom’s network each year is not enough to match the ambitions of our economy.

This is not to suggest that the decision to privatise the phone system was wrong. We all know that the options available to telco users have amplified since privatisation. But it cannot be denied that the manner in which we floated Eircom was ill-considered.

The government did not insist on any minimal level of capital investment on the roll-out of broadband, for example. If it had insisted on an obligation that Eircom provide universal access to broadband within five years it might have affected the selling price, but it would have been a better deal for the country.

The biggest deal in which Eircom has involved itself in recent months was the acquisition of the Meteor mobile network for a very fancy price of €420m. Obviously this could lead to improved competition in the mobile phone business.

But it will not address the infrastructural deficit that is apparent in the telco sector.

P.

BrianD

watty wrote:

it isn't even population coverage. It's exchanges assuming that EVERYONE on the exchange will get working adsl. Only a proportion of lines will. Some exchanges a tiny proportion.

This is an issue that I raised in another thread that nobody answered. Having listened to both Newstalk interviews last week as far as I am concerned, Eircom/ComReg came off the winner. Now I know that this is not the case from browsing this forum and elsewhere but the casual listener may have thought differently. Eicom had their PR gurus groom whats-his-name with all the "answers". And of course you have some of the rot that has been quoted in the ST article i.e we all prefer the cheaper and slower dial-up.

As a suggestion could the figures quoted in last weeks interviews be explained and dismantled? I think this would be of benefit to the many casual users of boards.ie who may not be up to spiel.

damien

BrianD wrote:

Eicom had their PR gurus groom whats-his-name with all the "answers"

David wasn't groomed. David is the real deal and doesn't need to be fed anything. He's quite a clever guy and well able to do his own legwork.

Blaster99

I didn't listen to those shows, but every other show I've listened to were structured to favour eircom.

BrianD

damien.m wrote:

David wasn't groomed. David is the real deal and doesn't need to be fed anything. He's quite a clever guy and well able to do his own legwork.

I'm sure he is but I'd imagine he has quite a "support group" behind him. No disrespect intended but I thought he came off the better in the interview although I know he was playing with the numbers. The bottom line is that despite the bad rep Eircom has in this market, people forget the past and if the slick talking guy from Eircom presents the facts, quotes the Oireachtas then average Joe Bloggs will probably believe it especially when the other side is a pressure group that they may not have heard of. This is why I suggest dissecting the figures quoted for the benefot of those who browse or may refer to this forum.

Urban Weigl

damien.m wrote:

David wasn't groomed. David is the real deal and doesn't need to be fed anything. He's quite a clever guy and well able to do his own legwork.

I have to completely and absolutely agree with you. David knows very well what he is saying, he is not just repeating the company line.