Nolan: "Nobody is forced to use Eircom. They choose to use Eircom."

glimmerman

http://www.siliconrepublic.com/news/news.nv?uid=&sid=&storyid=single548

sadly this requires registration etc....

classic quotes:

Nolan on FRIACO:
"We've read the Minister's statement and we'll work with the Government and the regulator to move forward," says Nolan. "But the real question for me is where is your investment best made? It seems to me that technology of the future is broadband and FRIACO is narrowband."

Nolan on the price cap:
"There is enough competition in the market to allow prices to find their own level. The time for sweating assets and stringent price controls has gone. We now need to attract capital back to the industry."

Nolan on competition in rolling out ADSL:
"One of the most extensive DSL rollouts was in Germany, one of the least competitive markets. The EU has just taken them to court because they still don't have competition on local calls! So it seems to me that there is no correlation between competition and broadband rollout"


And the final classic quote:
Nolan on telecomms competition in Ireland
"Nobody is forced to use Eircom. They choose to use Eircom."

Bonus points creating a caption for the brilliant photo of Nolan in the article...

ednwireland

yeh looks like typical eircom / public sector speak don't need competition price caps regulation etc etc just let us develop the most profitable sections of the network so we can pay back the loans for the ourtrageous price we were suckered into paying for eircom
nice to see that they are focusing on the current problem ie.

"Make no mistake, when the non-competitive agreement that was attached to Vodafone buying Eircell from Eircom comes to an end in 2004, Nolan has big plans for re-entering the sector. "

ok so we'll leave the rest of the network to die and cherry pick a fixed line and mobile service !
oh yes i can get my phone service from someone else but if it goes wrong eircom will refuse to fix it there is deregulation but unfortunately no-one seems to realise they still have the network which needs investment. they invest and resell to other providers which is where they make money if they are efficient and customer orientated which eircom aint
my rant over for the day
i get sick of reading this stuff from eircom stop complaining and provide a service

dahamsta

"Nobody is forced to use Eircom. They choose to use Eircom."

That's a lie. Philip Nolan is a liar.

C'mon Phil, sue me.

adam

yellum

"Nobody is forced to use the ESB. They choose to use the ESB "

"Nobody is foced to use air. They choose to use air "

Utter bollox

sceptre

Phil Nolan is trying to play one of the oldest tactics adopted by a CEO of a monopolistic company. Rockefellar tried this with Standard Oil when the US government started reading the Sherman Act they passed to combat anti-competitive behaviour and abuse of market share twenty years before. It's been a tactic used quite a bit since. For some reason, CEOs forget that it didn't work for Rockefellar.

His tactic is pretty simple: deny that a monopoly exists. If there is no monopoly, the Irish government will fall into line and realise that under their monetarist economic policies there's no need for any regulation as the ever-so-supreme market will regulate itself.

He is of course talking rubbish (but then again we knew that already)

Originally posted by glimmerman
Nolan on the price cap:
"There is enough competition in the market to allow prices to find their own level. The time for sweating assets and stringent price controls has gone. We now need to attract capital back to the industry."

In other words, he's saying what I mentioned above - there's lots of competition, why bother regulating us at all? Er, quick reason is because you're in a monopoly position Phil as you control the local loop. Even if Esat had the same market share as you, your two companies would be an effective duopoly. Any first year economics student probably knows that where two companies have a duopoly, they will make more money through effective price co-operation (note: I didn't mention the word "cartel", though from a pricing point of view it's the same thing). This is what's happening with Esat setting their prices relative to those of Eircom rather than at a level which will increase demand.

Nolan on competition in rolling out ADSL:
"One of the most extensive DSL rollouts was in Germany, one of the least competitive markets. The EU has just taken them to court because they still don't have competition on local calls! So it seems to me that there is no correlation between competition and broadband rollout"

Ah, an inductive argument. Induction is fine and dandy but doesn't apply when you can't prove a correlation between a particular case and the general case, which Phil hasn't. Germany has plenty of competition on long-distance calls, internet access (they even have some kind of "all you can eat" package - I think it's known as "flat-rate", fancy that). They also have DSL available around the country at a far lower price than Eircom's offering. ISDN has been standard for ordinary telephone lines for years. The correlation, Phil, is that no sane person will trust a company whose goal is financial profit and also happens to have a 95% market share to act in the best interests of its customers.

You're talking through your butt on this one. I know it, you know it. If you can't see the correlation between competition and DSL rollout (and more to the point, adoption) you're obviously not up to the task of running a telecoms company. Stupid or just pretending? I'll vote for "just pretending" but what do I know.

Nolan on telecomms competition in Ireland
"Nobody is forced to use Eircom. They choose to use Eircom."

As long as Eircom have an effective monopoly on the local loop, I'm forced to use Eircom. That's called a monopoly. It's under "M" in your dictionary Philip. In between idiot and plonker.

SkepticOne

Article on SiliconRepublic.com: Eircom: Between a rock and a regulator.

Points he seems to be making:

1. Competition does not lead to investment in infrastructure.

   "If we'd [Ireland] set out with that as the objective at the beginning you might end up with an incumbent who had 10pc market share, but you wouldn't have much investment in infrastructure. In some people's minds competition has become the end rather than the means."

2. Competition does not lead to uptake of DSL

   "He doesn't, however, think that competition is the key to widespread adoption of ADSL. "One of the most extensive DSL rollouts was in Germany, one of the least competitive markets. The EU has just taken them to court because they still don't have competition on local calls! So it seems to me that there is no correlation between competition and broadband rollout," he says.

3. There is already enough competion

   A very specific and short-term issue with the regulator is the price cap on Eircom, now being re-evaluated in a consultation period that will come to an end on 10 January. Unsurprisingly, Nolan believes the time is right to lift the cap. "We argue that you don't need retail price controls. There is enough competition in the market to allow prices to find their own level. The time for sweating assets and stringent price controls has gone. We now need to attract capital back to the industry," he says.

4. Eircom's infrastructure should not be duplicated in any way

   "Generally speaking, he is happy to report an increasingly healthy dialogue between the various bodies involved in communications. Potential banana skins, such as the possibility of replicating infrastructure in the Government's 19-town plan for metropolitan area networks, look like they will be avoided.
   
   "The discussions I've had suggest everybody recognises the problem of duplication and they are trying to avoid it. The problem with duplication is it could crowd out private investment, which is not a good thing," he points out.

5. Tax-payer should do more to stimulate demand

   "Everybody argues it's chicken and egg. I think it's a pull-push," he says. "If you're pulling and pushing you've got a much better chance of getting it from A to B. Some focus on the demand side would be very welcome. E-commerce and the spread of e-government would be important in driving demand. In the UK, Tony Blair committed a billion on the demand side," he adds."

6. The government should not be promoting FRIACO.

   "We've read the Minister's statement and we'll work with the Government and the regulator to move forward," says Nolan. "But the real question for me is where is your investment best made? It seems to me that technology of the future is broadband and FRIACO is narrowband."

What do ye think?

SkepticOne

BTW, I like the way he associates "sweating the assets" with price contol: "The time for sweating assets and stringent price controls has gone. We now need to attract capital back to the industry,".

sceptre

Threads merged (and I stuck Mike's heading on it because it's funny)

yankinlk

If I "choose" to use another phone company like esat, I still have to pay eircom line rental. How is that choice?

I am one of very few fortunate people that availed of chorus' phone service - just to avoid paying eircon this bribe, i mean line rental.

SkepticOne

Sorry, missed the other one.

SkepticOne

Originally posted by yankinlk
If I "choose" to use another phone company like esat, I still have to pay eircom line rental. How is that choice?

I am one of very few fortunate people that availed of chorus' phone service - just to avoid paying eircon this bribe, i mean line rental.

Not only that. If you switch phone company, the lion's share still goes to Eircom in CPS charges.

PiE

Strange how siliconrepublic have this opportunity to grill the f*cker in an interview and they let it pass.

Who are they anyway? If they can get him in for a chat, they could be pretty handy allies.

stormkeeper

"Nobody is forced to use Eircom. They choose to use Eircom."

yeah we have loads of choices... :rolleyes:

Like I had the choice between a full and split line... Oh wait, I didn't :mad:

Urban Weigl

Originally posted by glimmerman
"We've read the Minister's statement and we'll work with the Government and the regulator to move forward," says Nolan. "But the real question for me is where is your investment best made? It seems to me that technology of the future is broadband and FRIACO is narrowband."[/B]

Oh I could not agree more. For this reason, I would suggest an immediate halt to promoting narrowband technologies such as ISDN (also known as "hi-speed"), and replacing them with broadband.

Additionally, I would strongly recommend that the government take up Philip's recommendation and extend its USO, short for Universal Service Obligation, to include broadband at 512kbps or faster, starting at €14.99 pm including VAT (depending on which package the user signs up for). Faster access of up to 12mbps should be available for an additional fee.

SkepticOne

Originally posted by Urban Weigl
Additionally, I would strongly recommend that the government take up Philip's recommendation and extend its USO, short for Universal Service Obligation, to include broadband at 512kbps or faster, starting at €14.99 pm including VAT (depending on which package the user signs up for). Faster access of up to 12mbps should be available for an additional fee.

Well, I think that settles it. Broadband minumum USO.

El_MUERkO

"Nobody is foced to use air. They choose to use air "

Phil your a lieing sack of pap!

Delphi91

Originally posted by PiE
Strange how siliconrepublic have this opportunity to grill the f*cker in an interview and they let it pass.

Who are they anyway? If they can get him in for a chat, they could be pretty handy allies.

Can't be too sure, 'cos I haven't seen the article, however from the bits that have been included on this thread, it looks like the interview that Nolan gave for the Digital supplement in last Mondays Irish independent. Some of the quoted phrases were certainly in the interview.

Had a look to see if there was a link on www.independent.ie but nothing that i can find.

Mike

jmcc

Originally posted by PiE
Strange how siliconrepublic have this opportunity to grill the f*cker in an interview and they let it pass.

Fscking technology journalists! What would you expect - an interrogation by someone who has a clue?

They have to be civil and kowtow to people like Nolan. Basically most technology journalists are overawed to be in the presence of such movers and shakers. They just can't do decent interviews because a: they do not have the skills; b: they do not have the killer instinct; and c: they may need to interview the person again. And of course most importantly - d: they will get dropped from the press release list.

These personal interview things are just bits of fluff to sell to the Indo. After all that is where most of Siliconrepublic's stuff is run. Naturally considering the gombeen man, nothing bad about Eircom is going in the Indo. It would be like finding accurate subscriber figures for ireland.com in the Irish Times. ENN does much the same thing by asking the usual wannabes and nobodies for their views on the future. It is that time of year.

Regards...jmcc

SkepticOne

Originally posted by Delphi91
Can't be too sure, 'cos I haven't seen the article, however from the bits that have been included on this thread, it looks like the interview that Nolan gave for the Digital supplement in last Mondays Irish independent. Some of the quoted phrases were certainly in the interview.

Well a whois query gives the following:
Organization:
IT News and Media Ltd
Darren Mc Auliffe
2051 Citywest Business Campus
Citywest Co.Dubl, IE na
IE
Phone: 353 1 4038150
Email: darren@newsconnected.com

Registrar Name....: Register.com
Registrar Whois...: whois.register.com
Registrar Homepage: http://www.register.com

Domain Name: SILICONREPUBLIC.COM

Created on..............: Fri, Jul 26, 2002
Expires on..............: Sat, Jul 26, 2003
Record last updated on..: Thu, Dec 05, 2002

Administrative Contact:
IT News and Media Ltd
Darren Mc Auliffe
2051 Citywest Business Campus
Citywest Co. Dub, IE na
IE
Phone: 353 1 4038150
Email: darren@newsconnected.com

The only result from google for "newsconnected.com" is here.

AME: Initiative
(Irish Independent magazine aimed at SME sector)

ADDRESS: News Connected,
2051 Citywest Business Campus,
Naas Road,
Co. Dublin.

PHONE: 403 8165

FAX: 466 0524

E-MAIL: katrionab@newsconnected.com

So it does indeed appear to be an O'Reilly organ.

SkepticOne

Or a company selling to the Indo as jmcc points out.

Dangger

Basically most technology journalists are overawed to be in the presence of such movers and shakers.

Is Nolan really a mover or shaker"? Come on, what has he ever done?;)

Dustaz

Im almost sure a journo from Silicon Republic has posted here before and seemed fairly capable.

Personally, id love to hear from them about this.

Slutmonkey57b

Interesting and revealing article in the Sunday Business Post today (yesterday? I can't remember when I read it because it gets delivered a day early where I am) on O'Reilly in general, but v. specifically Eircon.

It reveals that the reason Eircon is so keen on upping pricing, removing caps, protecting margins etc has nothing to do with Eircon, it's to do with O'Reilly's other business problems.

Eircon is a cash cow - 100million in operating PROFIT last year. It doesn't have revenue stream problems, cost problems or insurmountable staffing costs. What it does have is an interesting ownership arrangement:
O'Reilly bought it out with Valentia Telecom, a consortium. Valentia is owned by another non-irish registered company that has filed no accounts. However, it has 60m worth of debt. Instead of selling Eircon to a viable operator that could take on its fixed costs and make a go of the business through restructuring, and alternative revenue streams from other markets, it was sold to one of the good ol' boys with no experience of the business. Why?

Because O'Reilly's businesses are all highly "leveraged" ie in debt. Wedgewood/Waterford is in particular trouble, as is Independant News & Media. This was not a problem when times were good and debt was cheap. No longer - O'Reilly needed to buy Eircon because he needed the revenue to pay down his other debts and avoid potential problems in his other holdings. But along came the downturn and the returns aren't looking as good. As a result analysts believe that Eircon is going to have to use its entire revenue for the year just to pay off Valentia and other O'Reilly operations' debt mountains. In fact it will be doing well to pay off the interest on the debt, never mind the debt itself.

Affordable broadband through negotiation? It'll never happen, not because Eircom as a company couldn't be bargained down, but because O'Reilly can't afford for it to happen. In fact, the Eircon bosses want to INCREASE broadband and residential charges to "Commercially sustainable levels."

Let's be clear here: Eircom is more than commercially sustainable - it is a cash rich monopoly. It is O'Reilly's other business that are unsustainable, and that's why Eircon's position on pricing is so over the top.
If the markets were left to their own devices, Valentia would be allowed to die off, and another more viable operator would step in and take on the company. But you can bet the government (and especially the regulator) won't have the guts to let Sir Tony get burned like that. After all, he got himself into it - why shouldn't the taxpayer get him out of it?

DeVore

I know of NewsConnected... They are a group of journos who are behind the ITs Monday supplement, though I wouldnt have said they were the brightest IT tools in the shed, they do claim to be competent journos and are professional about it.

Didnt realise until now that they are behind siliconrepublic.
For some reason that makes me feel sad, I was kinda hoping that the guys behind SR were going to get stuck in and bring some new reportage to the scene.

Instead we are likely to see warmed over Indo output with everything that entails...

DeV.

PiE

If what Slutmonkey posted is true... I fear for my kid's* broadband connection.

*And I'm not planning to have kids before ~2015

jmcc

Originally posted by Dangger
Is Nolan really a mover or shaker"? Come on, what has he ever done?;)

Give a few interviews? Still though in Irish terms he is up on the chart. He is one of the bigger players considering the size of Eircom and its market dominance.

Regards...jmcc

jmcc

Originally posted by DeVore
I know of NewsConnected... They are a group of journos who are behind the ITs Monday supplement, though I wouldnt have said they were the brightest IT tools in the shed, they do claim to be competent journos and are professional about it.

Yeah but interviewing is a bit different from the stuff that appeared in that article Dev. Basically it is about getting the interviewee to admit stuff that he or she would otherwise not admit. You are looking for that one aspect that makes the interview. What I read in that interview was classic waffle and this guy was supposed to be the 'editor' of SR. Some of the stuff that SR do is actually good - better, at least, than the usual press release recycling.

For some reason that makes me feel sad, I was kinda hoping that the guys behind SR were going to get stuck in and bring some new reportage to the scene.

It will take them time to find some form of stability and they may just produce some good work. However given the unhealthy connection between the Indo and Eircom, a lot of it may well steer clear of decent reporting on Eircom. Esat however would be a different story.

ITs Monday is John Sterne's op. The supplement stuff appears in the Indo I think though it is not from ITs Monday. (confused here without caffeine.)

Regards...jmcc

Boston

How you doing?

stormkeeper

This is a really worrying thing... A person who owns a telco and a newspaper company is a bad thing, due to the fact that the paper isn't/doesn't seem to be allowed to write 'the truth' about that particular telco, and instead you have all these articles that are written about that telco in a good light, as you're not allowed to write anything bad about a company when your boss-boss owns both, so instead we have misleading articles and such saying that Eircom are great, etc.

This sounds like abusing a position... imho.

*If I've gotten anything wrong, please correct me as the above is the impression I'm getting from this thread.

pork99

Originally posted by Slutmonkey57b
O'Reilly bought it out with Valentia Telecom, a consortium. Valentia is owned by another non-irish registered company that has filed no accounts. However, it has 60m worth of debt. Instead of selling Eircon to a viable operator that could take on its fixed costs and make a go of the business through restructuring, and alternative revenue streams from other markets, it was sold to one of the good ol' boys with no experience of the business. Why?

If only we had some political leadership who were not such a bunch of greedy half-bright gutless wonders. If I was in the governments position I would be squeezing eircom through Comreg until Valencia simply want to cut their loses and get out. Then they could buy back the infrastructure for some realistic price.

Maybe I'm underestimating them and they have a coup like that up their sleeves but given FF's history I'm not optimistic.

stormkeeper

to be honest... i'd say if any of us were in government (thinking rationally ), none of us would have let eircom be bought out... of cours, i'm sure there is more to it than meets the eye...