Consumers will be able to rent telecoms lines from phone companies other than Eircom by January 2003 following a decision by the telecoms regulator yesterday.
The move, which is intended to to revitalise competition in the ailing residential telecoms market, will enable customers to switch to competing firms and retain one bill for all their telecoms needs.
Currently, customers who transfer from Eircom to other telecoms suppliers have to continue paying line rental to Eircom while paying their bills for phone calls made to their new suppliers. From next January, Eircom will be forced to offer competitors, such as Esat and NTL, a wholesale line rental product that will enable them to offer line rental direct to consumers. This should make it more difficult for Eircom to win back residential customers from its competitors.
Figures obtained by The Irish Times show Eircom has won back 150,000 customer lines since January 2001 from a total of just 320,000 lines held by competitors.
The decision notice issued by the regulator, Ms Etain Doyle, said market research had found that multiple bills were a major factor in influencing telecoms customers to revert back to Eircom.
It also highlighted that competing operators often faced issues of bad debt as customers could switch back to the incumbent or to another operator more easily.
It said Ms Doyle believed the residential sector would benefit most from a single bill and should be given priority. Multiple billing was more of an issue for customers in this sector.
Ms Doyle has set a deadline of January 2003 for the introduction of the single bill system. An industry forum will be established to help work out the detail of the project, the decision notice said.
An Eircom spokesman said yesterday the firm was reviewing the decision notice and had no comment to make. But the decision notice highlights that Eircom lobbied against the proposals.
The number of customers who currently use carrier pre-select technology - the circuit that enables customers to use alternative telecoms suppliers - has declined alarmingly recently. In March, the number of carrier pre-select customers fell to 145,000, down from 160,000 four months earlier, as Eircom tightened its grip on the fixed-line telecoms market.
Coupled with financial difficulties at WorldCom and Spirit Telecom, and speculation that Esat may withdraw from the market, pressure had been growing on the regulator to kickstart competition.
The decision yesterday, which reflects a similar announcement in Britain last month, will go some way towards boosting the competitiveness of licensed telecoms operators other than Eircom.
Mr David Taylor, director of regulatory affairs at Esat, said the firm welcomed the decision. "Customer perception is that two bills are a bad thing, so this will help to revitalise the market," he said.
