Row over Eir’s pricing structure at centre of broadband delay

A dispute over the price Eir charges other companies to use its infrastructure appears to be at the heart of the latest delay to the National Broadband Plan (NBP), The Irish Times has learned.

The three firms involved in the Government’s procurement process – Eir, Siro and Enet – are likely to have to use part of Eir’s network to get at the 542,000 rural households and businesses earmarked for the plan.

The price Eir charges other operators and its own retail arm for access to the network will therefore have a significant bearing on the overall cost of the scheme and must be agreed before procurement can progress.

The Department of Communications is understood to be unhappy with the current suite of prices Eir charges rivals for access to poles, ducts and cabinets, and wants them reduced.

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As a result, telecoms regulator Comreg has been directed to examine the company’s pricing structure and is expected to make a recommendation in the coming weeks.

Eir has previously stated that its wholesale prices accurately reflect the costs involved and were agreed with the regulator as recently as last year.

ESB network

Another issue dogging the process relates to the ESB’s network, to which Eir itself has requested access, and the price the electricity utility, which part owns Siro, might charge.

Under the European Union’s shared utilities directive, infrastructural companies are required to open up their networks to other operators for projects of strategic national importance.

Eir claims it has been stonewalled in its attempts to secure access to the ESB’s network, which can use private lands to erect pylons unlike the telecoms company.

Minister for Communications Denis Naughten will have to iron out these complex pricing structures to progress the Government’s broadband plan, which has already been hit by a series of delays, pushing the likely start date out to 2019, a year later than originally anticipated.

Having previously indicated that work on the project would not commence until after Eir had completed a separate project involving 300,000 rural premises, Mr Naughten said yesterday the Government’s scheme would start once procurement had concluded.

“There is no question of the Government waiting for any commercial investment to conclude before shovels are put in the ground on the NBP State intervention,” he said following a meeting with the broadband taskforce.

Mr Naughten said the procurement process was making good progress in parallel with the rollout of broadband products by commercial operators and that the three bidders had been invited to submit their “detailed solutions” by September ahead of a final tenders process.

However, Opposition parties have turned up the heat on the Minister over broadband, claiming the public’s confidence in the Government’s ability to deliver the NBP was waning.

“We’re absolutely appalled by the delays in the rollout of the National Broadband Plan, and we cannot understand why the State intervention element – the 542,000 houses – hasn’t gone to tender yet,” Fianna Fáil communications spokesman Timmy Dooley said.

“At present there is no timetable for this element of the plan – no start date or end date. Projects of this nature are rarely successful when there isn’t a detailed schedule,” he said.

The scheme is expected to take between three and five years to complete and involve a State subsidy of up to €600 million.

While most premises targeted under the scheme are expected to receive high-speed broadband within the first two years of the contract, many may now have to wait until 2023.