McRedmond Opinion Piece in Irish Times

damien

Irish Times Business Friday, June 10, 2005

Eircom defends broadband strategy
The firm has target to get above the EU average penetration level by 2007
Comment David McRedmond

A feature article in last week's Business This Week argued that the Republic is behind on broadband. This is based on league tables of broadband penetration in the European Union. However, this does not convey the true picture of what really is happening with broadband.

Here are the facts:

• The growth rate of broadband in the Republic in 2004 was the highest in the EU.
• The actual growth per capita was above the EU average.
• Eircom was one of the first incumbent telecoms to double the speed of its products at no cost to the consumer.
• Actual prices, taking account of promotional discounts, are towards the lower end in the EU and standard prices have fallen dramatically.
• Broadband availability is on a par with our European neighbours and ahead of many (while we cannot be complacent about the frustrations of those customers who cannot yet get broadband).

In a very short period, one in ten households in the State have taken up broadband. This means that almost one in four PCs are connected to broadband.

That the Republic does not score well on a static chart of broadband penetration is a function of history rather than current performance. (Alcatel, a leading broadband equipment vendor calculates that the Republic is about 12 months behind the UK, where BT is being widely praised for its moves on broadband (better progress than many commentators previously assumed).

Late last year Eircom set a target to get above the EU average penetration level for broadband by December 2007, having beaten its previous target. We are determined to achieve this. In the meantime, bemoaning our league position will not get us there faster and will only serve to paint a misleading, negative picture. That a licensing restriction prevented Eircom from rolling out an advanced broadband platform in 2001 (and caused a delay while a compliant platform was put in place) is now a moot point. However, it is this delay that current league tables reflect, not the recent good performance of broadband in the Republic.

Another implicit argument in the article is that the lack of unbundling is to blame for low broadband penetration in the State. However, any analysis across the EU shows no correlation between levels of unbundling and broadband penetration. For example, less than 1 per cent of lines in Belgium are unbundled and it has one of the highest levels of broadband penetration. Overall, only 2 per cent of lines in Europe are unbundled, accounting for only 13 per cent of broadband lines. Most consumers do not know what unbundling is and are not interested.

It is right to point out that unbundling levels in the Republic are very low but the question is why. Local loop unbundling has been available in the State since 2001. One operator claims to have unbundled 40 of Eircom's exchanges. However, the reality is that other operators have typically preferred to take up Eircom's wholesale products because these have offered a better economic return.

The range of products available to other operators to re-sell in the Republic would be the envy of operators in many European countries. That operators have largely chosen this method of market entry (connecting 35,000 customers) rather than unbundling to sell broadband is their choice. Telecoms in the State is now highly competitive (particularly in contrast with other utilities). Firms compete either with a range of wholesale services on Eircom's network or via competing infrastructures in mobile, cable and wireless. But the most insidious argument put forward by some commentators is that other operators have a right to unbundle Eircom's network, apparently in whatever way they desire. The argument is put forward that, if this is allowed, consumers would benefit from a range of hypothetical services. This argument conveniently ignores several issues. Who will pay for investment in the network? Who will upgrade the exchanges for broadband? Who will pay for stranded assets or bad debts?

The answer in almost every case is either Eircom or the consumer. An impact on either would be bad news for broadband in the Republic. Eircom is currently half way through a programme of ˆ1 billion network investment over five years. Since its re-listing last year on the stock markets in London and Dublin, Eircom is attracting international investment into the Republic - investment for the State's telecoms infrastructure.

The good news about these investors is that they are rational and will make their investment on the basis of a likely return. Management's role is to ensure that this investment is sensible, well executed and reasonably protected. If this is done well, the company will be able to attract further investment for its customers and its network. If that investment comes under threat from what we perceive to be bad regulation, then we have to act. Eircom is entitled to the same con- stitutional rights as any citizen or other firm. The company has no choice but to take action where it believes its rights are being infringed. This is the only way for it to continue to attract the investment which is essential if people in the Republic are to have access to the best broadband services.

David McRedmond is the commercial director of Eircom

paulm17781

It is right to point out that unbundling levels in the Republic are very low but the question is why. Local loop unbundling has been available in the State since 2001. One operator claims to have unbundled 40 of Eircom's exchanges. However, the reality is that other operators have typically preferred to take up Eircom's wholesale products because these have offered a better economic return.

Who sets these prices??? I stongly dislike McRedmond and his truth bending.

Delphi91

...
• The growth rate of broadband in the Republic in 2004 was the highest in the EU.

Of course it is! That's 'cos we're playing catch up with everyone else in Europe!!

• Broadband availability is on a par with our European neighbours and ahead of many (while we cannot be complacent about the frustrations of those customers who cannot yet get broadband).

Yes you can! I can't get Broadband and Eircom told me their lines were crap when I asked for ISDN. That smacks to me of a "we couldn't care less" attitude.

Mike

cgarvey

The argument is put forward that, if this is allowed, consumers would benefit from a range of hypothetical services.

. Smart's offering (dependant on LLU) wipes the floor with eircom's offerings. Nothing hypothetical about that. Nor is the fact that eircom continue to thwart the LLU process in anyway they can.

This argument conveniently ignores several issues. Who will pay for investment in the network? Who will upgrade the exchanges for broadband? Who will pay for stranded assets or bad debts?

Well investment in the network can't get any worse. With one of the highest line rentals in the EU, we still have few exchanges upgraded, extremely high failure rates, and no decent investment in the infrastructure. Pair gains continue to be used, lines are being split on brand new estates, rather than laying some decent infrastructure. I now see why eircom are concerned as to who will pay for the network, because they clearly have no intention of doing so (on any realistic scale at least), but would rather play patch-it-up

.cg

viking

paulm17781 wrote:

Who sets these prices??? I stongly dislike McRedmond and his truth bending.

Mr. McRedmond is not "bending" the truth at all, in fact what he says is completely 100% accurate. He has simply not mentioned that the LLU prices were so high that 40 exchanges could not have been unbundled by Esat/BT without financial assistance from the Government. This is the reason why OLO's choose to resell Bitstream rather than invest in LLU.

LLU prices are coming down to somewhat more viable levels (Smart are beginning their LLU programme) but eircom would prefer OLO's not to engage in it[1] as they would then no longer maintain the monopoly on the copper line and enhanced/better value services can then offered by competitors.

Lets not forget that eircom, in conjunction with Comreg and the industry, sets an agreed LLU product. The processes within this product are not imposed on them, if they have an issue with some of the aspects of unbundling carried out by OLO's then it is their own fault as they would have created the product spec in the first place.

Viking

[1]"But the most insidious argument ... is that other operators have a right to unbundle Eircom's network, apparently in whatever way they desire."

paulm17781

viking wrote:

Mr. McRedmond is not "bending" the truth at all, in fact what he says is completely 100% accurate. He has simply not mentioned that the LLU prices were so high that 40 exchanges could not have been unbundled by Esat/BT without financial assistance from the Government. This is the reason why OLO's choose to resell Bitstream rather than invest in LLU.

LLU prices are coming down to somewhat more viable levels (Smart are beginning their LLU programme) but eircom would prefer OLO's not to engage in it[1] as they would then no longer maintain the monopoly on the copper line and enhanced/better value services can then offered by competitors.

Lets not forget that eircom, in conjunction with Comreg and the industry, sets an agreed LLU product. The processes within this product are not imposed on them, if they have an issue with some of the aspects of unbundling carried out by OLO's then it is their own fault as they would have created the product spec in the first place.

Yes but if Eircom decided to make it cheaper for LLU...

McRedmond makes it seem as though Eircom are doing everything. They are the ones hindering LLU with high prices. This is why he is bending the truth.
If LLU was cheaper people would quickly move away from bitstream.

Sponge Bob

paulm17781 wrote:

This is why he is bending the truth.

He is bending the truth because the Irish Times knows as much about telecoms as a dog knows about his father....and exercised appropriate editorial control on that basis .

However I am bitterly disappointed that McRedmond did not take this opportunity to categorically state that Eircom intends to keep us ahead of Greece at all costs never mind catch up with Estonia and Malta .

paulm17781

Sponge Bob wrote:

However I am bitterly disappointed that McRedmond did not take this opportunity to categorically state that Eircom intends to keep us ahead of Greece at all costs never mind catch up with Estonia and Malta .

I wish you'd stop bringing that up, I keep laughing in work when I read comments like that.

Mr_Man

.

lucernarian

from David McRedmond
But the most insidious argument put forward by some commentators is that other operators have a right to unbundle Eircom's network, apparently in whatever way they desire. The argument is put forward that, if this is allowed, consumers would benefit from a range of hypothetical services. This argument conveniently ignores several issues. Who will pay for investment in the network? Who will upgrade the exchanges for broadband? Who will pay for stranded assets or bad debts?

You would think from what he was saying that Eircom would be the ones trying to unbundle lines from themselves!! I think he's "forgotten" that its other operators pay exorbitant prices to Eircom to carry out LLU, not the other way around. <.cg snipped>. If he's whinging that Eircom will not get their stinking €24 (which is one of the highest line rental charges in Europe) each month, then mabye he could be reminded that his company still gets €14 odd each month after LLU per line (also one of the highest charges in Europe).

His words are utter drivel. They have no meaning or substance to it. "while we cannot be complacent about the frustrations of those customers who cannot yet get broadband"?? He doesnt give a toss about the likes of me who cannot get it for no good reason.
I wonder if he can explain this little bit of info: Over the last year, after all the phone lines (and pairgains) I have seen in different parts of the country, why is it that I have seen one pairgain being removed after line improvment works?

Oh and one other thing: A friend of mine's dad is a senior accountant at Eircom. During the course of some conversation or other he mentioned that his dad was in Brussels on a business trip. Out of curiosity, I asked him why he would be going there. He said that he was there to try to persuade EU officials to allow Eircom charge a higher line rental each month. I know that sounds strange but that is what the son said. What do you make of that?

Oh and if anyone from Eircom is reading this, if you give me more than (literally) one good reason to justify your pathetic line rental then I will be satisfied. What a joke of a company...

cgarvey

TBC, please remove your comment about David McRedmond<snip>.

(As an aside, if anything, he's the opposite.. he's a genious.)


EDIT: I've removed it for you, I didn't want to leave it there for too long, thanks.

damien

Mr_Man wrote:

So when is the rebuttal going to appear

As soon as we can sell the idea to the Times. Meanwhile I'd suggest people email their opinions to the letters page: lettersed@irish-times.ie and post a copy of the letter here. The Times need to be made aware that consumers are not of the same belief as Mr McRedmond.

Please try and make your letters as professional as possible as the Times don't publish anything that contains personal swipes.

We also need everyone's help in deconstructing that article and pointing out the flaws and linking to the real facts.

govinda

lettersed@irish-times.ie

Dear Sir/Madam
Mr McRedmonds opinion piece in todays Irish Times is less indicative of the broadband situation in Ireland than the Business This Week article it was written in response to. The growth rate of broadband in Ireland is indeed increasing, but it has to as we are so far behind the rest of Europe, and indeed the world, in this regard.

Our broadband failures are a direct result of zero competition in the market as regards the 'local loop' or last mile into the customers home. As a business, it is in Eircoms interest to protect this, but this does no good to the consumer. The reason that all residential DSL products are 'resold' versions of Eircoms product is not that bitstream solutions are better, but that the local loop unbundling (LLU) alternative is so overpriced by the incumbent. EsatBT were able to unbundle 40 exchanges only with the assistance of government grants.

Telecom Eireann, the state telecoms company with the interests of the Irish people at heart, is no more. It has been replaced by a business answerable only to its shareholders. The sooner the Irish government take action and give our telecoms regulator real teeth, the sooner we can expect to have a first-world telecoms network again.

Sincerely,

Sponge Bob

damien.m wrote:

We also need everyone's help in deconstructing that article and pointing out the flaws and linking to the real facts.

Here is a start . There is so much distortion in that OpEd that it makes me mad at the Irish Times, again , new charter or no new charter

Here are the facts:

selectively distorted ones.

• The growth rate of broadband in the Republic in 2004 was the highest in the EU.

and the rate tailed off rapidly in 2005, you admitted it when you published your annual report last month and that is why you used 2004 figures not 2005 figures which show BB connections from Eircom growing at about 25% or less of the AVERAGE EU GROWTH RATE TODAY, see Peters post

• The actual growth per capita was above the EU average.

100% of **** all is still **** all . I note your use of "WAS above the average" as it is well below it in 2005

• Eircom was one of the first incumbent telecoms to double the speed of its products at no cost to the consumer.

Unlike NTL who have doubled their product speeds twice in the past 2 years and them not even an incumbent. Incumbency evidently means that if you were not the incumbent you would have doubled the speed twice as often. You only did it because Smart made you so thanks for nothing again .

• Actual prices, taking account of promotional discounts, are towards the lower end in the EU and standard prices have fallen dramatically.

Actual prices are towards the higher end in the EU , and thats before we mention the mandatory most expensive line rental on the planet !!!!!!!! . The discount scheme was dragged in to make it look better averaged over 6 month contracts .

• Broadband availability is on a par with our European neighbours and ahead of many

GREECE IS NOT A NEIGHBOUR !!!!!! Our geographic coverage is the lowest in the EU becuase Eircom have set the lowest distance limits in the EU . The number of people who can get DSL today is about 60% of households as cmpared to 96% in NI and 99% in the UK . Only 60% of the Irish population lives in a town with Eircom DSL installed which explains that fairly simply innit .

(while we cannot be complacent about the frustrations of those customers who cannot yet get broadband).

As long as we will generally not do anything to fix their lines we introduced a voice activated system on 1901 so that they couldn't actually report the faults and if they do find a human in there it is trained to tell the customer that a faulty line is not actually faulty so they wont log the fault, now **** off . This chicanery is not complacency so he is right there. It is systematic.

In a very short period, one in ten households in the State have taken up broadband. This means that almost one in four PCs are connected to broadband.

Do No businesses have Broadband then ? Eircom has 130k-140k connections (many of them trial not contract ones ) in a country with 1.4m households and 100s of 1000s of businesses . I'd love to know how Dave got the figure supporting his assertation that 25% of all PCs in ireland are in an eircom BB enabled house . I have 4 pcs in my house but ony 2 are connected to BB anyway , and according to the census 2002 form my house has a computer but they NEVER ASKED ME HOW MANY in the first place .

Next para someone else.

Blaster99

I'm not good at stats, but didn't eircomtrib and possibly others point out that Irish BB take-up is actually falling behind the rest of Europe, not catching up?

"The range of products available to other operators to re-sell in the Republic would be the envy of operators in many European countries"

Is it possible to show from our previous survey that the products available in Ireland are pathetic? In other countries stuff like 24Mbps for €50 a month is available.

"The argument is put forward that, if this is allowed, consumers would benefit from a range of hypothetical services."

A real service is Smart's broadband, which costs €35pm including line rental against €78.63 for the equivalent Eircom package (that's also capped and contended, unlike Smart's service). That's a 55% discount.

Another real service is Leap's SDSL. Their leased line over SDSL (http://www.leap.ie/HardWire.pdf) costs €12,399 in the first year inc install against €36,836 for an equivalent Eircom leased line inc install. That's a 66% discount.

SeaSide

"BT is" NOT "being widely praised for its moves on broadband" but is being threatened with its breakup if it doesnt get its act together

damien

Two Point Topic reports:

http://www.point-topic.com/content/dslanalysis/dslq105ana.htm
UK is fastest growing of the big broadband markets

This shows trends in pricing. Notice how many are going towards $30 a month
http://www.point-topic.com/content/dslanalysis/bbprices050519.htm

eircomtribunal

damien.m wrote:

Irish Times Business Friday, June 10, 2005

Eircom defends broadband strategy

McRedmond begins his article referring to last weeks article. (A feature article in last week's Business This Week argued that the Republic is behind on broadband.

Is this article accessible somewhere?

P.

lucernarian

Firstly, apologies to all for the comment about David McRedmond. Damien and cgarvey were correct and I would've removed it sooner only I haven't been online all day. That outburst took it off my chest though

I didn't even realise McRedmond had come up with the figure of "almost 1 in 4 PCs are connected to broadband". If all the big corporations and businesses with leased lines/DSL & networked computers were included in that, then the figure would IMO be pushed over the 25% amount. But if those computers were to be left out then I'd expect the figure to be at best 10%.

From David McRedmond
The range of products available to other operators to re-sell in the Republic would be the envy of operators in many European countries. That operators have largely chosen this method of market entry (connecting 35,000 customers) rather than unbundling to sell broadband is their choice.

"Choice" for other operators would involve having low costs for the other operators to even set foot in the phone exchange and even less bureaucracy. "Choice" in McRedmond's eyes appears to be to have operators resell Eircom's mediocre DSL products or else carry out LLU that is uneconomic in all but the biggest exchanges or with Govt. funding. Which one will the "logical" investor, as he puts it, choose?

Cork

The article in yesterdays paper was utter nonsense. Recent figures by the EU commission and the OECD put us down the league table with regards broadband.

Yesterdays article gave us few answers to improve the position.

dahamsta

cgarvey wrote:

(As an aside, if anything, he's the opposite.. he's a genious.)

A genius with the sole ability of misleading, misguiding and deceiving. Admirable. Personally I think calling him a genius is pandering to his ego. Personally I think he's a deceptive [snakeoil-selling slimebag] that's directly causing harm to this country.

adam

eircomtribunal

dahamsta wrote:

A genius with the sole ability of misleading, misguiding and deceiving. Admirable. Personnaly I think calling him a genius is pandering to his ego. Personally I think he's a deceptive asshole that's directly causing harm to this country.

adam

Fully agree with your opinion. Personally I think you should not have used the A-word – at least you should have put it in quotation marks: "admirable".

P.

cgarvey

dahamsta wrote:

A genius with the sole ability of misleading, misguiding and deceiving. Admirable. Personally I think calling him a genius is pandering to his ego. Personally I think he's a deceptive asshole that's directly causing harm to this country.

With mod hat on.. please remove the "A word" as eircomtribunal puts it.

Hat off ..Agree totally .. but that doesn't alter my original post .. he's still a genius, in my opinion. He drives me nuts when I hear him, and I too believe that he deliberately misleads, and all that.

dahamsta

cgarvey wrote:

With mod hat on.. please remove the "A word" as eircomtribunal puts it.

I think you may have missed the entire point of ET's post.

adam

cgarvey

dahamsta wrote:

I think you may have missed the entire point of ET's post.

Possible, but I don't think so.

Either way I've removed the term from your post, as you had ignored my request, (or, perhaps, missed point!!).

.cg

dahamsta

ET was being facetious and referring to the word "admirable". The fact that he actually puts the word in quotes at the end of his post is a bit of a giveaway.

I didn't edit my post because I don't understand what's wrong with expressing my opinion that McRedmond is an <.cg snip>. The only person who could possibly deem it offensive is McRedmond, and he's an <.cg snip>, so who cares?

EDIT: There, I've changed it to "snakeoil-selling slimebag", is that better? Honest to f*cking god. :rolleyes:

adam

cgarvey

You know the rules are there for everyone, and not just everyone except you, don't you?

You have the right to an opinion, sure, and have many valuable opinions to offer on this forum. You don't, however, have any more right than anyone else to break the rules.

You have clearly broken rules, and I'm pretty sure you know you have. If you don't like the rules, either take it up offline with myself or Seamus, or email the IoffL committee who have some say over the rules. Or you can take it up with the admins, if you feel the need.

dahamsta

It'd be fascinating to see a show of hands to see just how many people were offended by my use of that naughty dirty word in my original post.

Pathetic. Just pathetic.

adam

byte

Maybe, just maybe, eircom are trying to be a religious cult, and brianwash the masses:) with their Bishop McRedmond spouting out the sermons to anyone dumb enough to believe what he says.

Be wary of future eircom promotions whereby for the small fee of offering them your soul, you get 2 months free broadband and a FREE wireless modem (terms and conditions apply. Only applicable to the priviledged.)

dahamsta

L. Ron McRedmond? Xenucom?

(Is that allowed?)

adam

cgarvey

Locking the thread, as it hasn't been on topic, for ages.