A theory, please read and give feed back.

P R O F A N I T Y

A new Attack on per minute charges for the internet

After reading through a lot of information regarding eircom and odtr current battle over ADSL, I have come to the conclusion that eircom were selling the product as a low, they were then reabsorbing this lost through tax’s breaks and so forth.
The point of which was to block any other operator form taken up bitstream access.

This is grossly illegal and any other company would have been referred to the competition authority, it is even more so illegal in eircoms current monopoly stances.

It is also illegal to generate a lost for the sole purpose of tax Relieve; divisive to say eircom have been bad bad little boys. And they have just left themselves opened to attack fro ma new corner.

I don’t know why I never saw it before, and its possible im the only one to ever see the legal implications of this.

I take it most here know what CPS is, well while looking over my ntl bill today I noticed that calls to England are 6p while on eircoms network they are 12p and locals calls are 3p on ntl while eircom they are 1p, I hope you see were im going.

Eircom are selling local calls as a loss leader in order to get people to go with them over anybody else, they are blocking cps telecoms offering it at the same price, by having a hi wholesale price for cps telecom, they are then swallowing the “loss”(real just a drop in profits) and then making it back on long distance.
It’s the exact same situation as the ADSL one, except not as blatant. Probably because the competition authority have bigger teeth. With this people could challenge their whole per minute billing system.


Of course this all makes presumptions on costs, which are extremely hard to find on either odtr.ie or eircom.net

dahamsta

[EDIT: This was, of course, in relation to the wholesale bitstream DSL pricing, recently revealed by Esat.]

P R O F A N I T Y, the Regulator has said publicly (or at least a media source has quoted her as saying) that she is considering passing the matter onto the Competition Authority. There is a difficulty involved, in that both the CA and the ODTR could treat this issue like a hot potato and keep passing it back and forth - the CA saying it's a comms issue, the ODTR saying it's competition. Or even vice versa, since I would think that the ODTR would be lax to relinquish the problem, because comms is ultimately her responsibility.

It's a difficult situation, and probably even worse considering that we don't know even the half of the politics involved. That said, there can be no excuses at this stage. The problem must be resolved quickly, because the situation will worsen when the company is privatised in my opinion.

adam

Chaos-Engine

All very interesting information PROFANITY. May I suggest to you a plan of action.
Take what u jsut posted. Polish it up alittle. Make a small web page about it available. Then research alittle more into the costs and legal implecations. Then start senting every TD, Media company, Newspaper, the ODTR, Eircom and its rivals the info..

Shake it up

Maybe we could all take Eircom to the EU courts

b20uvkft6m5xwg

Adam AFAIK there is a legal obligation to not throw a complaint "around like a hot potato" @ European Level @ least- this is obviously to prevent any injustices from a commercial point of view and the need to move quickly to resolve issues so I wouldn't worry about the ODTR passing the buck onto the CA.

I think theres a lot more ill feeling among the business community and politicians than we realise, but then again as you said politics could prevent any major ruling so as not to step on their "m8's" toes.

Overall I'd rather the issues are resolved before a launch and if it means nothing til Christmas then so be it.

(BTW anyone know what the current situation on the 1890 numbers- or is that part of the current €ircoN -v- ODTR proceedings??)

Delphi91

Originally posted by P R O F A N I T Y
...
I take it most here know what CPS is, well while looking over my ntl bill today I noticed that calls to England are 6p while on eircoms network they are 12p and locals calls are 3p on ntl while eircom they are 1p, I hope you see were im going.

Eircom are selling local calls as a loss leader in order to get people to go with them over anybody else, they are blocking cps telecoms offering it at the same price, by having a hi wholesale price for cps telecom, they are then swallowing the “loss”(real just a drop in profits) and then making it back on long distance....

Let me first state that I am NOT a supporter of Eircom, etc, however I have to question some of your logic above.

According to your post, calls to the UK are 6p per min with NTL and 12p with Eircom. Local calls are 1p with Eircom and 3p with NTL. And as a result of this you are sugesting that Eircom are undercharging for local calls?

Consider the following possibility: NTL is a small co. in terms of the provision of phones in Ireland. So, to gain custmers, they pick a market where they "might" be able to attract customers - call to the UK. They pitch the price at half the cost of Eircom. Fair enough. Eircom aren't too worried 'cos they know that the vast majority of their calls won't be to the UK.

On the other hand, I think that it would be fair to say that because most of Eircoms calls are likely to be local-ish, they can charge a lower rate than NTL - economies of scale and all that.

If Eircom are undercharging for local calls and hoping to make it back on calls to the UK, etc, then that strikes me as a strange way to attempt to make money.

Ultimately what I'm saying is that maybe the situation is reversed from your idea - maybe NTL are losing money on UK calls and have to charge 3p per min on local calls to make back the deficit.

I'm only posing this 'cos the conclusions that you draw from what you stated seem a bit "illogical".

Mike

dahamsta

To be honest, I have to say that I've been thinking along the same lines as Delphi91 with regard to the below-cost issue. The local PSTN network is bought and paid for, and we all know that Eircom are under-maintaining it[1]. The cost of local calls to Eircom is miniscule, so I very much doubt that they're using it as a loss leader. That said, I don't know if the wholesale costs to OLO's are fair and equitable. But that's the OLO's problem surely?

adam

[1] Or, as it said on my t-shirt at the Internet Awards last year: "Eircon, working with wet string since 1985".

P R O F A N I T Y

Fair point, except your forgetting that CPS works in the exact same may the likes of oceanfree or utv net works. they have a set lists of wholeesale prices they are charged per minute service(these are extremely hard to find anywere)

Eircom charge ntl X amounth for every call made from an ntl cps phone to england. this amounth is such that ntl can charge 6p and still turn a profit.
Eircom is broken up into departments if you will, i dont know the exact break up but one department would handle, say internet, another home phone services,another fixed lines, another media. they all charge each other for their service.
alot like eircom the fixed line (afaik) is the department that charges eircom internet(eircom.net) for access to bitstream.

Bacially, they have to charge themselfs the same as they would charge an outside operator. So eircom make a huge profit on the 12p