EU to probe telecoms on resistance to competition

The European Commission has opened an investigation into the lack of competition in local telecoms networks across Europe, despite a regulation mandating liberalisation from January 1st, 2001.

The Commission's competition directorate has sent non-incumbent telecoms operators, including Esat and Worldcom Ireland, formal requests for information, and given them six weeks to reply.

The inquiry is asking the operators to detail why they have not accessed local networks and to supply evidence of any obstacles they have faced from incumbent operators.

Esat confirmed yesterday it would make a comprehensive and frank account of the obstacles it has faced in attempting to access Eircom's local network. Mr David Taylor, director of regulatory affairs at Esat, said yesterday that Eircom had shown extraordinary ingenuity in its blocking tactics.

"The fact of Eircom's dominance speaks for itself. Not a single local loop has yet been unbundled," he added.

The Commission says the purpose of its request is "to assess the compatibility of dominant operators' behaviour across the European Community with Article 82 of the EC Treaty, which prohibits abuses of dominant position".

A similar inquiry initiated by the Commission into mobile roaming charges produced several raids on offices of mobile operators in Britain and Germany this year.

The Commission is extremely disappointed with the lack of progress in unbundling the "local loop" - the last segment of copper wire from an incumbent's exchange to consumers' homes and businesses.

This process is expected to hasten the adoption of innovative technologies, including digital subscriber line, which provides consumers with high-speed, always-on access to the Internet.

British Telecom admitted last week that, while it had installed some 70,000 high-speed lines in Britain, it had only supplied 167 lines to competing operators.

In the Republic, not a single local loop has yet been unbundled. Esat and other operators have persistently blamed delaying tactics from Eircom.

The price, set by the telecoms regulator, that operators would pay to access Eircom's local network is being challenged by Eircom in the courts. However, Eircom blames other telecoms operators for not engaging with the unbundling process and formally applying to gain access to its network.

Only Esat has made a formal application to access Eircom's local network and several companies that expressed interest in the unbundling process have since withdrawn.

An Eircom spokeswoman said yesterday the company would be interested to hear operators' views on why only one firm had applied to gain access to the network.

The cash crisis affecting the telecoms sector has also had a dramatic effect on the unbundling process in Britain and the US, as several companies have run into financial difficulty.