Esat BT urges State to force broadband competition

The Republic will continue to see its competitive status slip unless the State intervenes to force a more competitive market for broadband internet access, Esat BT managing director Mr Bill Murphy has warned.

Mr Murphy called for Eircom to significantly lower the price it charges for its wholesale digital subscriber line (DSL) product - the DSL access service it offers competing operators, who then sell it on as a retail product to consumers and businesses.

"We need immediately to mandate much lower broadband prices," he said.

Eircom controls the telecommunications exchanges operators need to access in order to offer its own DSL services. Eircom charges €32.67 (including VAT) for wholesale DSL access, in contrast to BT's €21.84 in Northern Ireland and Britain.

Consumers pay as little as €22.98 for DSL from Tiscali in the British and Northern Irish markets. In the Republic, Eircom charges €54.45 for DSL, and Esat BT €49.49.

Eircom has a "stranglehold" on the market and will be unlikely to drop wholesale prices unless the Minister for Communications, Mr Ahern, intervenes, as he did last year to force the introduction of flat-rate internet access, said Mr Murphy.

Telecommunications regulator ComReg "needs greater enforcement powers" for its decisions as well, he said.

Mr Murphy pointed to the British market as a contrast, where more than 150 operators offer broadband access, with 55 operating in Northern Ireland, a market one-third of the size of the Republic. The Republic has four DSL offerings.

BT was forced by the British telecom regulator, Oftel, to lower its wholesale DSL prices, which created greater competition in which incumbent BT now has 25 per cent of the broadband market.

By contrast, Eircom retains 75 per cent of the Irish market. Mr Murphy says Eircom's wholesale prices have restricted his company from making DSL more widely available.

Several global surveys have downgraded the Republic's competitiveness because of low broadband penetration and weak technology infrastructure.