Spurred on by consumer anger over Eircom’s recent price hike, the Minister for Communications, Marine and Natural Resources, Dermot Ahern (pictured) has directed the Commission for Communications Regulation (ComReg) to introduce a wholesale line rental product for voice and services by 31 March. Ahern said he believed the margin between wholesale and retail line rental is wide enough to drive competition.
“If this product is not in place by 31 March 2004 and if it is not delivering verifiable competition and lower prices by 30 June 2004 I will direct ComReg to take line rental out of the present price cap, and set a specific rental cap no greater than consumer price index (CPIO),” Ahern told the Oireachtas Committee on Communications last night. He said he expects to go to consultation on the proposed policy direction over the coming weeks.
Ahern was granted power under Section 13 of the Communications Regulation Act 2002 to give policy directions to ComReg. He has used this power to push ComReg to pave the way for FRIACO (flat rate internet access) last year, which has resulted in 50,000 people availing of the service.
“While the development of the telecoms market is clearly dependent on the input from a number of players both private and public, I am confident that the significant investment by the government and my policy directions will send a clear signal to the market that I intend to ensure that competition develops so that no operator will be in a position to operate non-competitive pricing strategies in any market segment and that consumers, both residential and business, can go elsewhere if they are not satisfied with the range of services or prices being offered by individual operators,” Ahern said.
Ahern said he will focus on competition and innovation as a key objective for 2004. “I will mandate ComReg to incentivise the development of both platform and service-based competition. This will support the entry of new players and will lead to new product offerings from existing and new suppliers at attractive prices.”
Ahern said he will also issue directions to ComReg on broadband, local loop unbundling, interconnection and the mobile market.
“While these markets are at different stages of development and contain different competition issues, my overall aim is to set clear goals for ComReg on market development and require them to report back to me on progress,” he said.
By John Kennedy