ComReg to review Eir’s wholesale broadband business model

8 Dec 2015

ComReg said it is initiating a review of Eir’s regulatory governance model for wholesale

Ireland’s telecoms regulator ComReg has said it is initiating a review of Eir’s regulatory governance model for wholesale after a number of operators alleged discriminatory practices and delays.

In what is reminiscent of the old to and fro of the early days of DSL broadband a decade ago, ComReg is to investigate whether or not there is unfair treatment of other operators re-selling Eircom’s product.

The move by ComReg is significant in that Eir has successfully embraced wholesale as a business model, whereas in the past it had traditionally been vehemently opposed to wholesale.

Wholesale effectively allows other operators to resell services using Eir’s network at a margin and has been a successful method of speeding up broadband rollout in other countries, such as the UK, where BT has created Openreach, which sells services to other operators.

“Eir is permitted to take up to 10 days to fix 100pc of faults, compared to the UK, France and Italy where the incumbent operator is contracted to fix 100pc within two working days after faults are reported,” a spokesperson for ALTO, the group representing alternative licensed operators in Ireland said. “This can be frustrating for Irish consumers and businesses who are increasingly dependent on their broadband and telecoms services.”

Eir is also competing to win a portion of the Government’s National Broadband Plan, which is being spearheaded by Communications Minister Alex White TD to give 600,000 homes and 100,000 businesses a minimum of 30Mbps speeds by 2020 at the latest. One of the stipulations of the plan is that wholesale access to the new networks is part of the offering by winning operators.

Eir is in the middle of a drive to expand its broadband network footprint to 1.9m premises and it recently launched commercial services with speeds up to 1Gbps.

This week the operator acquired sports TV service Setanta in a move that will greatly enhance its position as a TV and quad-play (mobile, broadband, TV and phone) provider.

Significant market power player

Eir has been designated by ComReg as having ‘significant market power’ in the wholesale broadband space.

At the heart of the review by ComReg is an August 2015 update to industry on regulatory governance and allegations of long lead times experienced by alternative operators requesting new or wholesale products by Eir.

The key purpose of the review is to ensure regulatory governance in wholesale is robust and responsive enough to put alternative providers like Vodafone and Meteor on an equal footing with Eir’s retail arm.

ComReg has warned that the review of wholesale reform at Eir could potentially lead to a number of potential outcomes, most notably the spectre of consultations on the case for functional separation of Eir’s wholesale division, a situation Eir is no doubt keen to avoid.

In its recent financial results, Eir reported that it now has 798,000 total broadband connections, up 16,000 in the quarter, and that 41pc of network broadband connections are high-speed broadband.

Eir’s retail broadband base was 453,000 at the end of September, flat on last year. This was compensated for by gains in Eir’s wholesale base, which grew 71,000 year-on-year to reach 344,000 wholesale broadband lines.

Q1 was also Eir’s strongest quarter of fibre connections to date, with 45,000 premises upgraded to fibre.

Fibre broadband image via Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years