Broadband Capping - Why?

LegacyUser

From Galdiator -

"LLU has been operational in Ireland since January 1st"
so how many lines have been unbundled,
lets see how many lines in 6 months, at least 100,000? no, 10,000 then? no 10 then? no, not one line unbundled, yea i dont think the job is finished yet


Gladiator, I was present in the ODTR meeting with AC. The ODTR worked to get all the legislation and service agreements in place for the January 1st deadline. The LLU was unbundled by the deadline. For YOU to see your loops unbundled a telco must come along and request the unbundling of lines. Prior to the deadline some 14 operators were looking for unbundled loops. After January 1st only ONE operator showed any interest. It was some time after this deadline (several months) before Esat officially requested LLU.

I know there is a lot of information to keep up with from various discussions and meetings which have taken place at lightning pace but I feel some recent comments are not really doing any thing for our cause.

I very much appreciate AC taking the time to post on the boards and hope she continues. I'm trying to do my best to get up to speed on the issues and a major element of our campaign is the education of our members as to the intricacies of the whole process. AC involvement is a part of that education as she is involved first hand!


[This message has been edited by Dangger (edited 27-07-2001).]

LegacyUser

why would they request it before the price was set,

LegacyUser

Thanks for the informative post on bitstream AC. Admitting my ignorance for a second I never did completely understand what bitstream was all about. Do continue to post on the boards because its nice to get some input from someone other than Martin (no offence meant martin, ure the tops ) I see by now u've also met Gladiator, the son we wish we'd never had Keep up the good work anyway!

LegacyUser

you cant **** off to, your the son i wish id aborted,

LegacyUser

<font face="Verdana, Arial" size="2">Originally posted by Dangger:
The ODTR worked to get all the legislation and service agreements in place for the January 1st deadline. The LLU was unbundled by the deadline. For YOU to see your loops unbundled a telco must come along and request the unbundling of lines. Prior to the deadline some 14 operators were looking for unbundled loops. After January 1st only ONE operator showed any interest. It was some time after this deadline (several months) before Esat officially requested LLU.
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While it's 'nice' to see someone posting here from one of the involved parties to this mess (ODTR), it doesn't mean we have to roll over and act all nice and praise them with every second post. When did Esat request unbundling - pre or post the ODTR intervention on pricing. It's irrelevent anyway, whether it's 14 or zero requesting it, it was still required to be in place on Jan 1. The world and it's mother could see that the LLU regime that was in place from that time was not adequate, and we're still waiting for that regime to be finalised (I do *not* accept the ODTRs assertion that LLU has been in place since January 1, it's a plainly disingenuous argument when it's impractical for any operator to implement it). The ODTR failed to implement practical LLU by the Jan 1 deadline because of their failure to force Eircom to provide all the information necessary. The fact that prices are still in a limbo and SLAs appear not to have been completed just highlights the continuing regulatory failures.

LegacyUser

<font face="Verdana, Arial" size="2">Originally posted by hudson806:
From the OLO's prespective, residential DSL is a viciously competitive market. Its not worth investing the kind of money required for the large scale rollout that res. DSL needs.
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Good ol' free market

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Remember that Eircom already has bandwidth into every exchange in the country, so from their perspective, DSL is about integrating a new service into their existing network.
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Bit late now, but why wasn't the telecoms _infrastructure_ kept in public ownership while privatising eircom?
A regulated environment of private management with rules for management handover based on pipe use might have been possible.
Just thinking outside the box

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Its worth doing on a small scale for High-Margin customers, who will want a fairly customised service, but for Residential users (who don't require customised installation work on the DSLAM) it will always be easier to rent the ports from Eircom.
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If its _always and forever_ cheaper, and given that eircom is invariably described as overstaffed, eircom must be operating the service at a loss, or charging a price aimed at erecting a barrier to entry.
That implies the 'free market' isn't free.
If the market isn't free, the regulator should be soliciting ways of freeing it.
i.e. mechanisms by which it is profitable and obligatory for eircom and OLO's to provide competition.

LegacyUser

Why indeed wasn't the telecoms infrastructure held by the people of Ireland - and now the government is looking to sell off Aer Lingus.

It seems quite crazy to me that on the one hand the government is producing endless reports talking about the need for a really good infrastructure - road, rail, air, electricity and telecoms - and on the other they're trying to shuffle the whole lot off their hands as fast as they can.

We are governed by people who have a touching belief in the goodness of businesspeople. And their efficiency, of course.

LegacyUser

<font face="Verdana, Arial" size="2">Originally posted by Neville:
If its _always and forever_ cheaper, and given that eircom is invariably described as overstaffed, eircom must be operating the service at a loss, or charging a price aimed at erecting a barrier to entry.</font>

Erm, no offence, but this isn't quite Inter Cert. Economics here.

Eircom, by virtue of its size, has, and probably will always have, a distinct advantage over the OLOs. It would probably take 50 years to build a new telephone network comparable to Eircom's (hopefully better )

For example, no OLO is going to compete with Eircom in the PSTN voice market. It would involve going into Eircom exchanges, installing PSTN equipment, paying rent in those exchanges, raising the money to pay for it on difficult capital markets, and for what? A couple of phone calls. Voice service has become so commoditised that its just not worth it. Thats why the OLOs pay interconnect fees instead.

My argument is that the same may well be true for residential DSL - its hard to believe now, but res. DSL is a totally commoditised market to be in. For most OLOs, with backgrounds in service provision rather than Access equipment there is a huge new investment to be made. Around the world, OLOs have chosen to rent ports for this reason - they can have the LEC do the un-sexy bit, and then (try to) cream it on the Value Added Services (ie Internet)

To jump back to Inter Cert enonomics for second:

The fixed cost of providing general Edge (eg ISDN, Leased Lines, DSL) services is high (people, equipment), but the marginal cost of new services is quite low.

This means that the average cost of installations will initially be high for newcomers to the market, compared to Eircom's, which will be low. Everyone remember their marginal cost curve touching off the bottom of their average cost curve, but only after a time? Thats the point where the OLO will be able to compete effectively.

So in order to effectively enter the market, the OLO must be willing to sustain a loss for a period of time. Right now, no OLO can afford to do that.

<font face="Verdana, Arial" size="2">
That implies the 'free market' isn't free.
If the market isn't free, the regulator should be soliciting ways of freeing it.
i.e. mechanisms by which it is profitable and obligatory for eircom and OLO's to provide competition.</font>

Thats just nonsense. Eircom are able to do this effectively because they've been doing it for years. OLOs need to build infrastructure in order to compete effectively. This takes time and is expensive, but once built they can operate profitably. If the OLOs choose not to do this, its up to them. And a very sensible alternative has been put in place to allow them to compete if they choose not to build up - bitstream.

[This message has been edited by hudson806 (edited 30-07-2001).]

[This message has been edited by hudson806 (edited 30-07-2001).]

LegacyUser

<font face="Verdana, Arial" size="2">Originally posted by Fand:
It seems quite crazy to me that on the one hand the government is producing endless reports talking about the need for a really good infrastructure - road, rail, air, electricity and telecoms - and on the other they're trying to shuffle the whole lot off their hands as fast as they can.
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Great minds

But this is getting off topic, so if anyone wants to argue with myself and Fand, start a thread. I'll keep my eyes open.

LegacyUser

[This message has been edited by infomat (edited 30-07-2001).]

LegacyUser

<font face="Verdana, Arial" size="2">Originally posted by Fand:
Why indeed wasn't the telecoms infrastructure held by the people of Ireland - </font>

The argument usually put forward is that Governments should be running countries not running commercial enterprises and this argument is usually supported by the claim that state enterprises are inefficient (CIE being a excellent example).

I must say that I am not 100% convinced ... I believe that the current fad for selling all public enterprises is not a good one (if you want good examples of what can go wrong just look at Water and Rail in the UK).


In the case of Eircom the Government sold us what we already owned (equivalent to paying additional tax ... a trick developed by Queen Victoria). The people responsible for running the company spent most of their effort on selling off bits of the company (Eg. Eircell to Vodafone)and now the rest of the company at a knock down price (subsidised by the ordinary shareholders).

When governments raise money in this manner one would expect to see improvements in other services such as HEALTH but for some strange reason this has not actually happened in either Ireland or the UK so why bother.

Why was Eircom which was one of the few Telcos in the World with little or no debt (and which was also making a profit) broken up and sold off with no apparent gain to the ordinary people of Ireland?

Unfortunately I don't know the answer but I do believe that the infrastructure should have been retained by the people of Ireland.
Unfortunately the mistake has already been made but let us hope that it will not be repeated.