Regulator comes under fire

22 Sep 2005

Leading lights from the telco sector took to the stage at last week’s First Tuesday event in front of a full house that was clearly expecting sparks to fly. In the blue and orange corner, David McRedmond (pictured), Eircom commercial director; facing him off was a selection of high-profile service providers that have built business models around loosening the incumbent’s grip on the market.

The discussion was labelled The Changing Shape of the Irish Telecoms Landscape — something of a misnomer, according to several of the panellists. “Are things changing at all?” questioned Iarla Flynn, head of regulatory affairs at Smart Telecom. “The issues around regulation, local loop unbundling and broadband uptake are still live issues that were covered at similar events two years ago.”

Sean Bolger, chief executive of Imagine Communications Group, picked up the theme: “There are lots of changes coming in but it’s the same old story in reality. We have seen changes in the regulatory structure but it’s been disappointing how ineffective they’ve been. There are lots of people doing innovative things but at the end of the day it’s about being able to deliver cost-effective product to consumers and that’s not happening.”

The Commission for Communications Regulation became the absent whipping boy for the evening with a chorus of panellists questioning its approach. “Regulation is a disaster,” said Feargal Brady, managing director of Blueface. “I favour no regulation at all. Take away line rental and the management of the fixed-line infrastructure, sync it up with the management of the underground cable around the cities and let the best man win.”

Flynn offered a more conservative analysis of the landscape. “Regulation is not going to disappear. Operators would like to see a lighter-touch regulation but only if the underlying processes between operators actually work, only if products can be launched and there’s a reasonable opportunity for competition. The regulator needs to pick its targets carefully and concentrate on bottlenecks, such as the wholesale side of broadband.”

Bolger was more forthright: “The regulator is like a blind referee. It gets caught up in loopholes that Eircom is well equipped to deal with. Regulation is failing the Irish economy, the Irish consumer and Eircom.” His last assertion was that Eircom was so preoccupied with a protectionist approach towards its own backyard that it had missed opportunities in the wider global market.

Jibes at the incumbent operator were a recurrent theme of the evening, though McRedmond, well practised in fighting his corner, managed to stifle most attacks. Unsurprisingly, he was a big advocate for a lighter regulatory touch: “We’re in a world where we’re up against global competitors. If we’re going to be regulated on a national basis in a local market it’s going to be extremely difficult for us to compete with global players,” he argued. “Regulation tends to work much better with mature, slow-moving markets where there is a certain predictability. When you start talking about new technologies, uncertain developments and uncertain markets, we all need to be able to move very fast. That’s difficult in a market that is heavily regulated.”

By Ian Campbell