Eircom begins reform and rebrand of wholesale business unit

22 Jul 2011

Ireland’s incumbent telecoms operator Eircom said today it will be adopting a management proposal for a wide set of commercial reforms that will boost access to Eircom’s national infrastructure for other telecoms providers.

The wholesale division will be rebranded and will have an enhanced role in the organisation. The rebranded group will be led by the recently appointed managing director for Eircom Wholesale.

The question for operators now is will it be a carbon copy of BT’s Openreach division or will it signal an eventual move towards functional separation of Eircom’s commercial and wholesale units.

The incumbent said the new measures will result in process improvements for existing regulated wholesale products, such as LLU as well as future next-generation network services.

Eircom currently provides wholesale access to more than 60 national and international service providers.

Access to its network is crucial for other providers as Eircom owns the existing copper network connecting most homes and business premises as well as 12,000 kilometres of fibre and a next-generation network core.

Wholesale access to the Eircom network has been a contentious issue for the past decade with operators complaining of a lack of openness, as well as potential conflict of interests with its residential division.

Greater transparency promised

The moves announced today appear focused on improving relationships with other operators and will include improved governance, measurable KPIs (key performance indicators), internal codes of practice and ultimately greater transparency.

CEO Paul Donovan said: ““These commercial reforms reinforce the importance of Eircom’s wholesale business and the value that we place on our wholesale customers. We want to deliver – and be seen to deliver – wholesale services in a way that ensures a level playing field for companies who want to access Ireland’s largest and most extensive fixed telecoms network. These changes will provide more efficient processes for operators who already access our network and maximise innovation for next-generation products such as fibre.

“We believe the proposed changes outline a clear and unambiguous set of measures that will help grow our wholesale business and further encourage competition within the telecommunications industry in Ireland. This will improve the quality and choice of products available to other operators and ensures that the industry as a whole continues to facilitate economic growth in Ireland,” Donovan said.

A spokesman for Eircom described the moves to Siliconrepublic.com as an initiative to reinforce the importance of the wholesale business and its customers and establish Eircom as the “network provider of choice” to other operators.

He said that the proposals have been broadly welcomed by operators so far.

Industry response to Eircom wholesale reform

According to Ronan Lupton of alternative licensed telecoms group ALTO, his members are adopting a wait-and-see attitude.

“It is now a case of seeing if they practise what they preach in the medium to long term,” Lupton said.

Lupton said in the past, operators had been concerned about a “Chinese Wall” situation in terms of Eircom’s approach and attitude to wholesale, as well as pricing and products.

“If there’s going to be a change of governance, that’s well and good. But there also needs to be a change in how they deliver products and if they can make it more cost effective in terms of how they are delivering them.

“We’ll wait and see what happens but welcome what they are proposing,” Lupton said.

A BT spokesperson said: “Today’s announcement by Eircom that it plans to ‘reform’ its wholesale division – more than 10 years after deregulation of the Irish market – is an acknowledgement that a level playing field does not exist in this market today. We look forward to receiving a detailed proposal from Eircom, which we hope will establish the essential governance and practices that are necessary to bring Ireland’s telecoms marketplace in line with other European countries.”

Photo: Eircom CEO Paul Donovan

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