BT considers legal action over LLU

6 Mar 2007

BT Ireland said that if necessary it may resort to taking legal action against Eircom over the incumbent’s decision not to allow its bitstream customers a seamless transfer to local loop unbundling (LLU) under the new number portability system it has unveiled.

Eircom today unveiled its fully operational number portability (GLUMP) product that will allow broadband users to switch provider within a matter of hours at no charge. However, the service does not provide for BT’s 80,000 bitstream DSL customers.

“Nor does it provide for the wholesale line rental (WLR) customers of BT,” said BT Ireland chief executive Danny’s McLaughlin, who explained that in total that means almost 200,000 BT customers cannot seamlessly transfer to the company’s LLU offerings under the new system.

“This is disgraceful,” McLaughlin continued. “There we are working in an industry forum under the Commission for Communications Regulation (ComReg) and here comes this news. We are due to open our next-generation network (NGN) exchange in May and I cannot offer 8MB broadband services to the 200,000 broadband customers who cannot migrate. That to me is very restrictive.”

Asked why this impasse with Eircom exists, McLaughlin answered: “It comes down to two things: it is strategic and it is about money. Eircom are determined to eliminate infrastructure-based competition. Now that Magnet and Smart have pulled back on the consumer DSL market we are potentially the last man standing.”

McLaughlin said that BT intends to press on with its network investments for Ireland, estimated at €500m, and has placed orders with Eircom Wholesale to upgrade LLU. “But we intend to resist this move by Eircom to the end. We’ve spoken with ComReg and it is aligned with us on this issue and agrees that it is unacceptable.”

Asked what weapons are at his disposal, McLaughlin said: “We have ComReg with its regulatory powers that are due to be enhanced. We are also looking at whether this constitutes de facto regulatory issues and if necessary we will use legal powers to prevent this from happening.”

When asked about allegations that BT declined to test migration products, McLaughlin said it was not so straightforward. “Our strategy is pretty clear: we want to migrate customers on to full LLU and that’s what we wanted to test.

“The olive branch would be a level playing field so that all customers would have access to the same choices regardless of provider.”

He described Eircom’s announcement as a smokescreen. “ComReg were due to put out a monthly progress report on LLU and that report was negative about migrations in particular.”

He said that today’s announcement does not constitute full LLU. “It allows customers to transfer between different operators but it also means that our 200,000 broadband customers cannot transfer to another BT product. They are corralled.”

McLaughlin said he acknowledged that the bill granting punitive powers to ComReg could yet be a year in the making. “But ComReg have existing powers they can use to resolve a situation like this and we fully expect to get on with that.”

For its part ComReg this afternoon said that while today’s announcement by Eircom was welcome, it was offset by continued delays in other aspects of the product. It said that the pace of progress to date on LLU has been unacceptable.

“LLU has been a key driver of innovation and broadband take-up in many markets internationally. The absence of an effective product offering in Ireland continues to have an impact in relation to the broadband arena

A range of both existing and new entrants to the market has highlighted to ComReg that a predictable and consumer-friendly product needs to be available before they could either invest or enter the market here with enhanced consumer products.

“The continued absence of a fully effective LLU product limits consumer choice, innovation and pricing flexibility.

“ComReg cannot and will not accept anything short of a speedy and comprehensive solution to all the outstanding issues. Our views and concerns have been fully shared with Eircom and its management team,” stated ComReg.

By John Kennedy