Should Eircoms Monopolistic *Last mile link advantage, be taken from them ??...

Paddy20

THE LAST MILE, CONUNDRUM!.

As most members of IOFFL are already aware, unlike most of the population.

Eircom has an unfair, if not totally illegal! anti - competitive stranglehold on ordinary citizens and commercial enterprise in Ireland. Simply, because it was wrongfully given the ownership of the critical - Last mile telephone line link - in too all properties in the Irish Republic! and it has used IMHO illegal monopoly, to stifle true open competition in the telecommunications and Internet Access marketplace.

This untenable situation has and is still being allowed to have a seriously detrimental effect on all sectors and citizenry of Ireland.

Should our Goverment now legislate in favour of *Compulsorily purchasing - this last mile telephone connection link - from Eircom for a nominal fee such as €1.00c. In the interest of establishing, once and for all. A fair openly competitive telecoms market in the Irish Republic ??.. Paddy20.

vorbis

paddy that is highly unlikely to happen. First of all it isn't illegal. Eircom assumed ownership of it as a private company. If you want more competition for it, then you need better competitors. Esat are in no hurry to force Eircom to unbundle the loop. They have no desire to do any of the line maintenance. The present situation probably suits them quite well.

sceptre

Originally posted by Paddy20
Should our Goverment now legislate in favour of *Compulsorily purchasing - this last mile telephone connection link - from Eircom for a nominal fee such as €1.00c. In the interest of establishing, once and for all. A fair openly competitive telecoms market in the Irish Republic

Firstly, that'd require a dramatic change in the way the courts have interpreted Article 43 of the Constitution. Then the EU would go gaga at property rights being disregarded in this manner. Compulsory purchases take into account the marketable value of the property being acquired. Then the EU would go gaga again at the idea of the State interfering in the natural order of competition and freedom to conduct business (yeah, I know it may not make sense but the State re-entering the telecoms market in this way would get at least two Commissioners screaming on the phone within minutes). The Eu's policy is to regulate businesses that have an effective or actual monopoly in important markets, not to divest them of their assets. So it'd cost about two billion euros (which we seemingly don't have) and then the EU would force a reversal of the transaction anyway.

Not going to happen. Get realistic. I may not like the way the infrastrucure was sold off (as it happens I don't like it one bit) but an idea doesn't become either good or practical just because one person (or a few people) thinks it so.

Feel free to discuss it, anyone, but you're just going over old ground to discuss something that won't ever (and I'm stressing ever) happen. If it could, suddenly land for building roads would become very very cheap. Tempted as I am to lock it on the basis of impracticality (and my genuine thought that it's just adding a new thread for the sake of it), I'm just going to leave it as is.

Dustaz

OK, thats clearly not going to happen.


What would it take though for the courts to force them to split into 2 companies though?

If Competition lawers were somehow able to make a case that eircom held an unfair monopoly by owning both the network and the dominant retail company, Could they be forced to divulge the network to a seperate company?

sceptre

Originally posted by Dustaz
If Competition lawers were somehow able to make a case that eircom held an unfair monopoly by owning both the network and the dominant retail company, Could they be forced to divulge the network to a seperate company?

Could happen. It'd take an anti-trust case like the Microsoft one in the US to do it though. And for practical purposes it'd have to be started in the EU copurts as it'd end up there anyway (could start it in the Irish high Court with the European Court of Auditors being asked for their opinion but it'd take as long that way and would still be appealed).

To succeed, the presence of a simple monopoly wouldn't be enough. The case would actually have to show that Eircom abused their position by leveraging their market share to extend their control over the market. They would have to be shown to be indulging in dodgy accounting practices across the board, secret discounts for customers (here's one they've actually done but they've been pulled for it by Comreg so that's no longer an option), placing barriers in the way of new entrants to the market (most of the EU directives over the past 20 years have concentrated on competition) and more importantly from the POV of the EU, using their market share to dominate outside their core market to the detriment of other companies. Can't prove that last one I'm afraid, because they haven't done it. Regulation of Eircom may be pretty damn poor a lot of the time but it does actually exist (which is what places the telco companies away from the Microsoft position). They're still obviously evil though.

There are other options to kick off such a case or investigation by Mr Monti. A class action by a large group of consumers would be one. For various reasons that's not an option though (as a quick example the judgement would have to include the word "wilful"). Most likely suggestion would be a class action relating to the overcharging (assuming that's there is overcharging) for line rental. Wouldn't tackle the core issue though.

NIBBS

Surely (and I agree with you Sceptre on all of the above) there is a problem with the issue of Line Rental and the increases that Eircom have made to the price of Line Rental in this country of the last few years, and thie is where I have a big issue with ComReg. There must, or what do Comreg actually do, be a good reason for Eircom to be allowed to increase the consumer price of Line Rental - however what is this good reason, have they consistenly come out with the same reason (maintenance of the lines) or is it just that they keep increasing the price to offset any losses they may incur due to increased competition on call and data services. I don't see where they are held accountable for the actual quality of the whole system and why there is no measurement of the increase in their costs in maintaining the system.

Am I wrong here, but surely if they aren't increasing the quality of the system, or showing where there increased costs are in comparison to the increased prices they are charging their customers then they must be in breach of something that was laid down when the company was privatised (surely there were guidelines set in place when the deal was done that ensure the quality of the service provided to people in the state ???)

gombín

One to note: eircom haven't touched the line rental on ISDN. Perhaps one final attempt to get blood from a turnip and launch it as Midband, or something else ridiculously named.

Paddy20

sceptre,

While I appreciate your probable superior knowledge of Irish Law!.

I find it hard to accept that while my local authority can use their compulsory purchase powers to buy land in order to facilitate the building of a necessary town bypass, despite the landowners objections.

The Local Authority still deemed it to be sufficiently in the best interest, of the common good! and proceeded with the compulsory purchase in an apparently legally acceptable democratic manner, which will now benefit all of the citizens of this area.

What, is so different about the EU Commisioners and our Governments inherent reponsibilities - to put to rights - the obvious mistakes of past administrations in relation too the everchanging telecommunications marketplace. Can they not be expected, or is not thier duty to legislate for the immediate introduction of a level playing field that will facilitate fair competion in the Internet Access and broader telecoms marketplace for all players entering the business. Without leaving one dominant telecoms business with an obvious unfair advantage which is not in line with EU guidelines on the openly competitive supply of services sector!.

It is high time and long overdue that all Irish telephone and Internet access users were allowed to benefit from a fair open market, and in my opinion as only a mere citizen I believe it is my right as a citizen of a new wider European Union.

Yours,

Paddy20.

sceptre

Originally posted by Paddy20
What, is so different about the EU Commisioners and our Governments inherent reponsibilities - to put to rights - the obvious mistakes of past administrations in relation too the everchanging telecommunications marketplace.

Nothing really. Acquisition under a CPO has to pay something akin to fair market value though, that's all (actually, there would have to be a few legal changes for a non-land CPO but let's ignore that). Fair market for Eircom's network would be rather more than a few bucks.

Mr_Man

It seems to me that this Gubmt is trying partially to undo the mistakes made by the last Gubmt (although they were to all intents and purposes the same) with respect to the telecoms infrastructure. They are providing funds for local authorities to run their own fibre, but the issue again is how to get past the Eircom stranglehold on thelast mile. The best approach would be wireless as its relatively cheap and much of the infrastructure is in place (masts etc).

The issue is the political will to drive an alternative to Eircom, and the potential for legal action by Eircom to protect their profits. The lack of leadership/backbone in this area leads me to believe that until there is enough pressure put on those in power, the pace of change will continue to drag and the digitial divide will widen between those in urban areas who have access to the limited availability of DSL/Wireless services and those in the rural areas who are hostages to Eircom.....

There is still a lot of work for IOFFL to do....

M.

OHP

Originally posted by Mr_Man
The issue is the political will to drive an alternative to Eircom, and the potential for legal action by Eircom to protect their profits. The lack of leadership/backbone in this area leads me to believe that until there is enough pressure put on those in power, the pace of change will continue to drag and the digitial divide will widen between those in urban areas who have access to the limited availability of DSL/Wireless services and those in the rural areas who are hostages to Eircom.....

M.

I totally agree. But at this stage I think the only way for people living in rural areas to go is Wireless. Nothing like ADSL / RADSL will ever become available to them within the next 40 years looking at the way things are going

OHP

Paddy20

Mr_Man,

You are correct. Considering the *Billions of Euros that the EU has thrown in to Irelands black hole of intrigue in Dublin.

Money, that was supposed to be primarily for the benefit of the ordinary citizens of Ireland!.

Where?, has this money been squandered!. I simply can not believe that the Dail has not got one politician with the gumption too publicly grab this Eircom monopoly issue by the throat, and raise the issue at question time!.

Paddy20.

BendiBus

On second thoughts, my comment had nothing to do with the offline-ness of Ireland.

flav0rflav

Comreg was put in place to solve the problem described. You'll have more success lobbying them.

As regards the gov buying the lines, what exactly would they then do with them? Give them to a gov loyal business man, to do the same thing again? The sell-off of wireless licenses is the example to go by. How has that gone?

Trebor

The govnerment own the roads and that is considered infrastructure, surely they could take back the telecommunications infrastructure and just let any company use it thereby keeping the EU happy as they will not be interffering by helping just one company, or they could rent it to everyone and use the money made to improve the cables.

OHP

Originally posted by Trebor
The govnerment own the roads and that is considered infrastructure, surely they could take back the telecommunications infrastructure and just let any company use it thereby keeping the EU happy as they will not be interffering by helping just one company, or they could rent it to everyone and use the money made to improve the cables.

Maybe I am wrong but is there not Pipes laid along every Railway Line that could hold Digital lines? I think I read that in some other post a while ago?


OHP

maxheadroom

Originally posted by Trebor
The govnerment own the roads and that is considered infrastructure, surely they could take back the telecommunications infrastructure and just let any company use it thereby keeping the EU happy as they will not be interffering by helping just one company, or they could rent it to everyone and use the money made to improve the cables.

But the government doesn't own all the roads - imagine what would happen if they tried to take back the toll bridges in dublin, for instance...

Mr_Man

If the Government took back the toll bridge they would have to pay compensation to NTR, BUT the traffic on the M50 would move a hell of a lot better.

The Govt has the opportunity to encourage local entrepreneurs to set up their own virtual telecoms by renting out the infrastructure at cost+ and then letting locals sell it on.

A number of people on these baords have expressed an interest in such a move. This would generate revenue, circumvent Eircom's stranglehold and provide employment - oh and also narrow the growing digital divide.

M.

Da Man

Am I the only person who remembers what telephony was like in this country when Telecom Eireann ran the show?

The problem should be solved with regulations. Why ComReg isn't doing anything worthwhile, God only knows.

Mr_Man

Regulation is fine as far as it goes, however the regulator is very unlikely to ever force Eircom to provide services (e.g. DSL) which Eircom can claim are uneconomic. This is the reason why only 80-150 exchanges are planned to be upgraded.

Now the question remains what happens to those who aren't on one of these exchanges ? If it is uneconomic for Eircom to upgrade would it be feasible for a more nimble competitor to provide the services and still make money ? Possibly, but Eircom are unlikely to facilitate this for a number of reasons.

The alternative therefore is to find a way around the last mile, if the Government is serious (and I doubt it is) about making Ireland the e-centre of Europe then they must take the lead. As noted in an earlier post the Government don't have a great record in the area of running things on a commercial basis. However it should be possible to find a group of business leaders capable of running/developing what already exists in a financially viable way by promoting virtual teleco's as I outlined in my last post.

This might also spur Eircom into some realisitc action if only to protect its monopoly. Do we have the ability to do this - yes ! Do we have a Government capable of seeing the big picture on this - no ! Is it every likely to happen - ??????????????????

M.

donegal2003

Originally posted by Mr_Man
Regulation is fine as far as it goes, however the regulator is very unlikely to ever force Eircom to provide services (e.g. DSL) which Eircom can claim are uneconomic. This is the reason why only 80-150 exchanges are planned to be upgraded.

One can put a numbers hat on and prove that it isn't economic to provide DSL anywhere in the country. Company X has a monopoly of the copper serving every user. Without DSL people are forced to use dial-up which generates *****cash rollin by the minute and because the slow bitrate forces the suckers to remain online for ages. This creates the status quo starting point.

Why should company X bother with DSL. It is clearly not economic. Emigrate all you DSL prospects. This is a country run on numbers. The numbers are against you - wherever you live.

Flip the coin.

The real cost of DSL is the marginal cost - i.e. the extra cost incurred in installing the DSL thingies. Company X acquired the installed plant and equipment from gov. This plant includes connectivity to each node in the network. All or virtually all of which had the necessary surplus capacity to backhaul the DSL related traffic from each node to the core network for starters. Where capacity shortages exist, it is generally possible to upgrade the existing stuff in the ground without a costly mass grave digging exercise.

The cost then comes down to the DSL modem in the exchange. Most node premises have sufficient space for at least a DSLAM (modem) rack on the wall and then some. The aforementioned rack has a capital cost of about EUR 130 per DSL user. The other set-up costs are more than paid for by the DSL user in company X's high service set-up fees, over-priced modem charges and OTT monthly DSL service charges.

There is little economic cost in providing DSL wherever the demand exists if you subtract the monopoly base argument from the case – which surely has to be done.

As it stands DSL availability is just a token job to shut people up. Not unlike the 50,000,000,000,000,000 cost of putting a few crappy trams and trains in our capital city.

Donegal2003

Paddy20

donegal2003,

Welcome aboard. Thats the best post I have read in a very long time. It should be forwarded forthwith to Mr Bertie Ahern & Co, who could, should and would do something about this fiasco.

If only we had public representatives and Ministers in the Dail who were prepared to stand up and - really -represent the real true interests of the people who elected them.

Paddy20.