ComReg slashes LLU charges

dahamsta

ComReg slashes LLU charges
Wednesday, May 28 2003
by Matthew Clark

ComReg is to cut the charge other operators will have to pay to Eircom for access to the local loop.
In in a decision notice on Wednesday, the Irish communications regulator said that it would fix Eircom's LLU (local loop unbundling) charges at EUR14.67, over EUR2 lower than the current rate of EUR16.81, set last year.

The local loop is the so-called "last mile" of copper wires that run from an exchange to a customer's home or into a business. Eircom effectively owns all of the local loops in Ireland and any entrant telecom that wants to provide services to customers must deal with Eircom in one form or another. Opening up the local loop is generally regarded as a key factor in broadband/DSL provision.

The cut in prices means that telecoms looking to enable a line for broadband, or any other service that involves the local loop, will now have to pay significantly less for access to that line.

More importantly, the move from ComReg is the exact opposite of what Eircom was seeking after the former monopoly applied for a 60 percent increase in LLU charges last year. A spokesperson for Eircom on Wednesday said the company had no comment on the move as yet and the firm was still analysing the decision.

Meanwhile, ComReg blasted Eircom for even requesting such a large price hike (EUR16.81 to EUR27.00), calling the requested rise "overstated" and saying it would "seriously impact on Ireland's competitiveness in the key electronic communications sector and could not be justified."

The regulator went on to say that the rates proposed by Eircom would place Ireland's LLU charges at more than three times best international practice and 70 percent above the next highest country. "It potentially would have significant price implications for retail line rental, increasing the level well over EUR30 per month," ComReg added.

"Businesses and citizens in this country must have access to an inexpensive, world-class communications infrastructure and a wide range of services," added Etain Doyle, ComReg chairperson. "Unbundling the local loop for other service providers is one method to bring about a substantial reduction in the costs of using the Internet."

seamus

\o/

Optimism is rising..........

Lol @ eircom's requested price hike. It seems ComReg are finally realising that their existence doesn't revolve around eircom's happiness.

SkepticOne

At present, I doubt if there are more than 1000 unbundled lines in the country, so this measure would cost Eircom no more than 2000 euros.

Eircom's big fear, of course, is the unlikely event that telcos other than the rather tame Esat might be attracted to LLU in Ireland.

flav0rflav

This is bollox? right? You're just winding me up before my dinner?

2 euro ?

slash ?

seriously 2 euro?

27 / 3 = 9 euro is best international practice

What's most annoying is that it won't now change again, for what 12 months?

Only option now is to push for a reduction of the bitstream price at 27 euro.

[edit]

It appears to be true. Story at rte does _not_ use the word 'slash'.

What about the facilities access costs? They were the ones that actually inhibited LLU.

spongebob

Th prices are in the appendix of the Comreg Decision .

We will ...unusually...go from the most expensive LLU in the EU (at present) to being third behind Luxembourg and the UK...actually second because sterling has fallen so much since Comreg costed this, disregard Etains graph. The median LLU is something like €12 so we are still far too expensive.

€14.67 + VAT is €17.75

Eircoms current Line Rental is now €23

The competitors can now see daylight betwen their potential Line Rental in a single Billing system and that of Eircom.

As in the recent decision of Three to feck off with ESAT, Eircoms greed is now starting to hurt them big time. Eircom are off to the High Court to whinge about this. It took Comreg 13 months of "Deliberations" to get this decision. What a bunch of ditherers.

The same Comreg allowed 2 line rental increases in 3 months, totalling 8% for the rest of us.

Page 10 of the Linked Decision notes that the Access Charges (which take the piss on a global scale, one thing we Irish do well) are under review. Decision by 1st November on that and the Access Charges may be cut RETROACTIVELY. I still have very little confidence in Comreg but November is when they said to a recent poster that we would have a new USO.

Here is Comreg's own description of Eircoms co-operation throughout the process.

Throughout the process there have been significant delays and a failure by
eircom to provide reasonable, consistent and timely information. Following
eircom’s failure to provide acceptable pricing in 2001, this office issued
Decision Notice D8/01 which set interim rates for LLU services. These
charges were challenged by eircom; however this legal action was
discontinued in 2002. Rates were finalised in Decision Notice D4/02 which
set final rates for the period 1 January 2001 to 31 March 2002 and for the
period 1 April 2002 to 31 March 2003. Bringing certainty to the market
allowed access seekers to accelerate their programmes, and one operator
has now collocated in 40 exchanges providing access to 25% of the lines in
Ireland.
Decision Notice D4/02 signalled that charges would be reviewed following
31 March 2003 to take account of the advice given by eircom and the
Industry during the Industry Advisory Group process. In addition, in order
to allow eircom enough time to submit prices for LLU, these charges were
subsequently set as interim charges for the period 1 April 2003 to 31 May
2003. eircom were required to produce revised charges for ComReg’s
approval for all LLU services. It should be noted that occupancy charges
are not due for review until 1 November 2003

Further down after a whole page of a Profs biography

Considering the 13 months of work already spent by ComReg, eircom, and
the industry analysing Bottom-Up LRIC costs, eircom have agreed that
further engagement on the outstanding areas of disagreement at this time
is unproductive. Therefore, ComReg regrets that the only reasonable and
proportionate action is to direct prices for LLU line rental charges.

In plain English, having wasted everybodys time talking sh1te for OVER a year and in trying to argue a ludicrous cost model from which the LLU charges are derived , Eircom agreed to stop because nobody believed them!

4 Different Variants of LLU were reduced in price, the headline is the first one.

Full Loop ULMP Monthly Rental: €14.67
Full Loop Line Sharing Monthly Rental: €8.17
Sub Loop ULMP Monthly Rental: €13.37
Sub Loop Line Sharing Monthly Rental: €7.52

ESAT uses 1 and 2 for Business ADSL, I trust that they wil pass on the saving to their customers.

M

flav0rflav

from the Decision Notice
It should be noted that occupancy charges
are not due for review until 1 November 2003.

I've calmed down now, reading through that doc would passify most people.

LLU price is 'reasonable', but not good for a country promoting itself as a 'digital hub'/'ecommerce centre'/'new media mecca' etc.

spongebob

According to a post by Tripkipke in the Other Countries sticky on top it is now possible to get

3072/128 DSL 10Gb Cap for €27.72 a Month INCLUDING VAT Retail from the Dominant Carrier In Belgium see the Belgacom prices (in French ..TVAC means VAT included)

If you bust the 10Gb Cap, Belgacom will charge €5 each for extra 5Gb packs. Eircom will charge you €36.60 for 1GB packs (by the 1Mb increment).

The allegedly efficient carrier Eircom would charge Belgacom €27 WHOLESALE for 512/128 Bitstream and thats EX VAT if Belgacom were stupid enough to come here, which they are not.

Precisely what IS believable about Eircoms figures anyway?

M

flav0rflav

Eircom play the game, is the style they should, that of a private company with a monopoly.

They can only be moved from their position by the regulator and/or government.

If someone with a better ability than me to navigate comreg.ie, could point me at the timetable of upcoming 'actions', I'd be most greatfull (is that one or two L's). (Good job I don't have to spell the words that come out of my mouth.)

Stonemason

Any idea if Eircom have a leg to stand on i.e can they now tie this up in the courts for another year ?.As for eircoms proposed price hike smells to me like they went so high hoping for comreg to haggle them down to a €2 increase glad to see it didnt work .Still think comreg saying it will encourage BB rollout is cobblers ok maybe to larger citys and towns but still no rural soloution.

ednwireland

eircom announce this morning they are appealing the decision, so much for rising optimism

eircom philosophy - why should we become more efficient when we can s**ew the irish consumer

don't expect any action on this unless the gov. force this issue for at least a year

Fallschirmjager

i would imagine their thinking is ...'let tie this puppy to the post, legal it to death, by the time its nearly done, we can go back and ask for an increase again..'

what a pity they dont put this brain power to rolling it out...

Slutmonkey57b

All Irish companies are thieving sh!ts. Eircom have a big advantage because they've watched the Big Daddy (BT) doing the same thing in Britain for the previous 15 years. If you want to know what's going to happen next in the Irish telecoms market, you're better off reading OFTEL reports and British newspapers from 5 or 6 years ago.

As we all know, none of this will change until the government that is supposed to be overseeing this sort of thing does something about it. Ie Tony's mates pull the rug from under him. Or sack Doyle. Oh wait.

Dangger

Perhaps someone can answer this question, but hasn't ComReg set up a separate appeals board to prevent such decisions being dragged through the court system, in attempt to prevent this tactic being employed by Eircom?

spongebob

Non? . I said this was happening yesterday. Eircom had the Court papers prepared before the Decision was announced.

The bigger issue is this. Both the Competition Commission and the OECD have recently noted the deplorable lack of Competition in the Irish market. The Chair of Comreg should remove itself if it had any honour, the lack of competition has been caused by INSTITUTIONAL FAILURE over a number of years at the regulatory level.

LLU is one of the key levers for this because even if the takeup is low making LLU a symbolic rather than a widespread method for the competion to compete, its being there sets a floor on the value of a copper loop ......and that copper loop is where it is still at in terms of Broadband delivery for most of us.....as of now.

Eircom challenge in the High Courts is actually a tactical device to place the varied issues involved in the promotion of Competition and the investigation of systemic anti-competitive practices in Telecoms in Ireland UNDER THE PROTECTION of the courts.....by making the issue Sub Judice. This tethers the skittish Comreg goat for a while but it keeps the mean Competition Commission Bull (with Fraud Squad and Criminal Assets Bureau backing) at bay as well.

Eircom are pretty much laughing at Etain Doyle, they are more afraid that John Fingleton has moved them up his target list. I hope that they fear Fingleton with good reason. I also hope their case is kicked out by the end of next month on the grounds of Vexatiousness and Frivolity.

My 2.4c

M

BigEejit

Originally posted by Muck
I also hope their case is kicked out by the end of next month on the grounds of Vexatiousness and Frivolity.

Is that an actual word or did you just make it up?:D ... but as you say, Eircom are just trawling it through the courts because they can can make more money as it is now (current pricing minus court costs = €€€€€ ... new pricing = €) .. they just cant see that large volumes of broadband customers at cheaper LLU rates is also = €€€ and large volumes of broadband customers on their own service = €€€€€€€€€€ ...

P.S. .. completely off topic, but does anyone know what happened with eircons plan to get loans based on future profits?

SkepticOne

Originally posted by Slutmonkey57b
As we all know, none of this will change until the government that is supposed to be overseeing this sort of thing does something about it. Ie Tony's mates pull the rug from under him. Or sack Doyle. Oh wait.

Doyle will be standing down to make way for either John Doherty or Isolde Goggin in the next few months.

flav0rflav

Eircom do not want LLU or broadband. They _will_ make less money per phone line if they arrive in volume.

They want a high price, not to make money, but to strangle the service, and preserve their own per minute profits.

BKtje

Vexatiousness

Causing or creating vexation; annoying.
Full of annoyance or distress; harassed.
Intended to vex or annoy

What are the chances of Eircom winning in the courts or is it purely a delaying tactic? Do they actually think they can win in the long term?

Trebor

Originally posted by B-K-DzR

What are the chances of Eircom winning in the courts or is it purely a delaying tactic? Do they actually think they can win in the long term?

it's a delay tatic as they know that broadband is what the people want but they are heavly in debt so they want to milk us for all we're worth in order to pay off a much as possible.

when they are in profit they MIGHT change but i doubt it as they will have so much experiance in getting "blood from a stone" that they will continue to do so.

Chowley

I am starting to hate Eircom more and more everyday.They are complete B*STARDS.The price that Muck quoted above for 3meg BB in Belgium is amazing, Im bloody moving Ive had enough of this arseways country:mad: :mad:

BendiBus

spec. in Law. Of an action: instituted without sufficient grounds for winning purely to cause trouble or annoyance to the defendant

---

Excerpted from Oxford Talking Dictionary
Copyright © 1998 The Learning Company, Inc. All Rights Reserved.


Not only is it a word, its a real legal word!

spongebob

Originally posted by BendiBus
spec. in Law. Of an action: instituted without sufficient grounds for winning purely to cause trouble or annoyance to the defendant

Not only is it a word, its a real legal word!

I WAS talking about the High Court so I judiciously chose a legal term.... IMO Eircom have as much chance in the High Court as a fart does in a hurricane. They should be spat out the door on the first morning.

I said "Vexatious AND Frivolous" , not vexatious.

That means that the High Court action is not only without merit but is an abuse of due process and Eirocm KNEW that before they went to court. The supine Etain Doyle (she ' has no power ') , is intellectually incapable of seeing things that clearly so she with dither and mither and leave the impression that they may (umm) possibly (emmm) have a tiny chink of a case (uuuuuhhhhh) yes. Please send someone else.

M

SkepticOne

In todays Irish Times, there's a report that Eircom are planning to pull out of a "1 billion investment" over this measure that will cost them around 2000 euros a month.

I think that the mere fact that Eircom feels free to use proposed investments as a means to get its own way highlights the position of total dominance that they are in. If we had a competitive market they would not be doing this since not investing would mean commercial disaster.

The future clearly lies in removing Eircom from their dominant position, thus forcing Eircom to compete and invest if they want to survive.

MDR

I think that the mere fact that Eircom feels free to use proposed investments as a means to get its own way highlights the position of total dominance that they are in. If we had a competitive market they would not be doing this since not investing would mean commercial disaster.

Not unlike a pop stars temper tantrum ...

We need alternative infrastructure ....

Trebor

would it be possible to get the compeitive Association to split eircom into two companies:

one company that owns the cables and provide wholesale access to last mile and a telecoms company that has to compete with the likes of Esat and Ntl. then the company would not be able to get a better deal as it would be a seperate company.

and if the company that owns the lines does not have to worry about making a profit off of it's phone service it would be more willing to upgrade the network.

does this make sense or am i rambling?

dahamsta

It make sense Trebor, some of us have been ranting about it for years. I'm pretty sure a search on the word "split" in here will turn up a few posts by yours truly.

adam

Dangger

Their ownership of a vital state asset is being used and abused.

This asset which the Irish tax payer has payed for the and the Irish fixed line phone user continues to pay for is being held up and threatened right under our noses. Should this company continue to own this asset? Loopco (separation of the infrastructure from the incumbent) is not likely to happen, but the EU has not forgotten about it entirely. It was a hot potatoe at last years Bussels Telecoms hearing IOFFL attended. Actions like this from Eircom surely strengthen the case.

Obviuosly they are quite sure of getting their own way in announcing such threats despite the fact that the government continues to get a hammering about Ireland's dire telecoms services and lack of broadband. They are so sure of themselves that despite increased political debate on the matter, and recent announcements (granted they probably take little notice of them) from Dr. Fingleton of the Competition Authority and a continued hammering from ComReg, that they threaten the competitiventess of Ireland even further by stating that they'd rather see the infrastructure rot in the ground then be forced to become an efficient operator.

Surely this is one fo the most blatant warnings to the current government yet that this company and they're continued beahviour are seriously bad news for Ireland. It was one thing giving them the network in the first place, but it's another letting them hold the country to ransom in this manner.

IrelandOffline will be making a presentation to the joint Sub-Committee on communications next Wednesday in Leinster house. We'll post more details on this shortly. But it's hugely important that we have such opportunities to comment on the record at such critical times in the development of Ireland's telecom market.

flav0rflav

Here is the doc with prices for putting equipment in an exchange, ie. to put in a DSLAM to take advantage of the bargain 15 euro line cost.

http://www.eircom.ie/bveircom/pdf/aropricelist.pdf

Start with some site surveys at 5,000 - 10,000
then a bit of site prep at 200 - 300
then some site provisioning at 3,000 - 6,000 per KW power
some MDF access at 500

Continue with rental
100 - 500 x factor between 1.5 and 2.3, per square metre per month
"additional services" at 100 - 300
power standing charge ~1000 per KW per annum
power consumption 800 - 1600 per KW per annum

And finish with various:
connect 120
disconnect 50
planned access first 30mins work hours 60
unplanned after hours first 30mins 220

One unfortunate aspect is that the initial cost for rural exchanges are more expensive than suburban, but the rents are lower.

spongebob

Originally posted by SkepticOne
In todays Irish Times, there's a report that Eircom are planning to pull out of a "1 billion investment" over this measure that will cost them around 2000 euros a month.

This is the same Eircom of whom Comreg said....in the LLU decision that started this thread in the first place and specifcally about FIGURES provided by Eircom to them over a 13 month period.

Throughout the process there have been significant delays and a failure by eircom to provide reasonable, consistent and timely information.

This is the same Eircom who said in January 2003

In April 2002 eircom launched its EUR125 million rollout of broadband DSL. To-date a total of 700,000 telephone lines have been DSL enabled and this figure will increase to one million by December 2003.

If the Broadband rollout is costing €125 Million for 150 exchanges (no more) as they said .....what is the other €850 Million being spend on...... €200m for Biddy Culling and the rest in bonuses for Phil and his muckers.

Why do I suspect that Jamie Smyth may have written this article ?

M

SkepticOne

Yes flavorflav, that is the really annoying thing. Eircom is getting in a huff about the reduction of 2 euros per line and threatening to pull out of ficticious 1 billion investments, yet the reduction itself probaby won't make much difference since there are all these ancillary costs, and so potential competitors still won't be attracted to LLU in Ireland.

SkepticOne

Originally posted by Muck
If the Broadband rollout is costing €125 Million for 150 exchanges (no more) as they said .....what is the other €850 Million being spend on...... €200m for Biddy Culling and the rest in bonuses for Phil and his muckers.

The 1 billion was pulled out of thin air. I'm surprised they did not say that they were cancelling a 10 billion investment. That would have had greater effect.