DSL delays as Eircom scraps contract

Eircom has scrapped the technology platform upon which it was developing its digital subscriber line (DSL) offering.

DSL is a technology that enables telecoms operators to offer customers high-speed "always-on" Internet and multimedia services.

Eircom has cancelled a contract it struck with Newbridge Networks in January 2000. Although it is in negotiations with equipment vendors to replace the platform, the introduction of DSL will be delayed.

Eircom's contract with Newbridge, which was later acquired by French firm Alcatel, was reported to be worth £12 million (€15.24 million). However, an Eircom spokeswoman said last night this was inaccurate and the change of platform wouldn't cost the firm a penny.

Sources familiar with Eircom's DSL strategy claimed yesterday the network equipment provided by Newbridge Networks was not robust enough.

"When the company bought the product they didn't do their homework," claimed the source. "The DSL modems didn't have the throughput to work when lots of people used the system."

Last month Eircom placed its entire DSL strategy under review and terminated the contracts of almost 100 Accenture consultants.

Its decision to change the technology platform will mean the company will not be able to offer other operators bitstream access to its local network by its deadline of April 1st.

Competing telecoms were planning to offer high-speed data services such as DSL by availing of bitstream access to Eircom's local network in the absence of full local loop unbundling.

The future of DSL in the Republic is looking increasingly bleak because of the regulatory uncertainty and financial difficulties facing telecoms companies.

Both Eircom and Esat are reviewing their DSL strategies. Last month Esat chief executive Mr Richard Cooke suggested a Government subsidy would be required to roll out the technology.