Speaking about the ComReg announcement, chairman of IrelandOffline Damien Mulley stated “This is a very positive move from ComReg and we congratulate them on their very hard work to achieve this. ComReg made large in-roads to make LLU workable in the past 12 months and the latest news is the most significant so far. This resolution is a major boost for broadband in Ireland.”

The report from ComReg now means that companies like BT Ireland can move their own customers from a resold eircom package, to a package that alternative provider fully controls and this will be done with little disruption to consumers and businesses. This enables new products with offerings such as VoIP, TV and much higher speed broadband can be offered to the public.

Mulley added “Many of the operators have been waiting for this good news for years. Now that it has happened we hope that they start to make the broadband market more competitive. The ball is now firmly in the court of the alternative providers and it is now up to them to give the public more choice and better value for money.”

*Local Loop Unbundling is the process where alternative providers put their brodband equipment into an eircom exchange and take full control of a customers line which enables them to offer any service they want. Currently the major of broadband products over a phone line are “bitstream” products, meaning that eircom controls the upload and download speeds of the products and other companies just rebadge the product.

Damien Mulley, Chairman of IrelandOffline stated “We very much commend the Minister and his Department for bringing out this tender to give many more people broadband but we do wish it had happened a few years ago and not three weeks before an election. There is still many years left before the results of this are felt.”

IrelandOffline pointed out positive aspects of the tender and stated that the tender makes sure that people will be able to pay a fair price for a fair service in areas that so far have not been able to get broadband but they did point out some major flaws in the tender.

Mulley added “We have strong reservations about the geographic locations that the Department selected as these areas do not cover every location where broadband is currently unavailable. If what the provided map shows is correct, many thousands of consumers and businesses are still going to go without broadband.”

Even in areas where a broadband provider operates, it does not mean everyone in the area can get broadband. Many factors such as poor line quality and split lines mean that even people within the 4.5km DSL threshold cannot get broadband. The Department also thinks that if a wireless operator is in your area then you can get broadband. This is far from the case and many people will testify to failing broadband tests due to trees, houses and hills being in the way. No provider guarantees 100% coverage, yet the DCMNR tender seems to think this is the case.

IrelandOffline also pointed out that this tender does not cover areas where eircom have recently promised to roll their service out to. The main area of contention with this from IrelandOffline’s perspective is that eircom has not said when they are going to roll out to their areas and a promise of “real soon now” is not comforting to the 25% of the country still trying to get broadband..

Mulley also said “While many will now be able to get broadband, many thousands more are still being overlooked by this broadband tender. We are quite concerned that all the fanfare about this before the election will turn into disappointment for businesses and consumers when the sobering facts come to light about the tender.”

Mulley added “All candidates in the upcoming election need to make broadband availability a top priority as it directly affects education, health and jobs. Broadband is not just about surfing the web but about making life easier for businesses and consumers by connecting them.”

The ComReg report available online.

See page 16 of the ComReg document:
“Reasons for not using a broadband connection Among business users connected to the Internet, but not using broadband, their primary reason for not doing so is lack of availability. This figure (47%) has remained unchanged between H2′05 and H2′0610.”

IrelandOffline highlighted areas that need to be addressed in order for Ireland to rise up the broadband league tables:

• Government broadband tender needs to be announced: The Government have said they will have a tender for the supply of broadband to the large parts of the country that cannot get broadband. This tender has yet to be announced. It needs to be announced and fasttracked.
• Timeframe for eircom exchanges to be enabled: In the past 8 months eircom have announced that 400 additional exchanges will be announced with 100 to be enabled sometime in 2007. No timeframe has been disclosed for the other 300 exchanges.
• Local Loop Unbundling still unworkable in Ireland: Despite some leeway being offered by eircom, local loop unbundling (the placement of broadband equipment belonging to BT, Smart, Magnet into eircom exchanges) is still not workable as can be seen by Magnet pulling out of consumer broadband products and only offering business products.
• Better regulation in Ireland: At present the communications regulator is not proactive enough and has not helped to ensure broadband is available to the whole population. ComReg needs serious reform moving on and to prevent one broadband company from becoming dominant and removing all competition.

As a result we now call on all political parties to accept these recommendations and to agree before the election that if they are in Government that they will enact the Oireachtas recommendations. All of the parties have worked to put this report together and it only makes sense for them all to now promise the Irish people that they will stick by their recommendations.”

Mulley went on to add “While this report highlighted the issues with the Group Broadband Scheme, we believe that it was a success when it was running and would point out that it was wrong for Minister Dempsey to cite lack of take up of the Group Broadband Scheme as being the reason for shutting it down. The fact is that his Department refused all applications for the past two years. Were the scheme allowed to continue past April 2005, 1000s more people would have broadband today.”

The latest Oireachtas broadband report is available online.

The two recommendations made today by the Oireachtas are:

1. The Joint Committee recommends the establishment of a stakeholders group to agree a short term plan that addresses market failure.
2. Following on recommendation 1 above, set in place a publicly funded programme, that is run as an open tender to provide nationwide broadband access.

The Oireachtas Committee was also severely critical of the Metropolitcan Area Network (MAN) project.

The new eircom is consistently proving their commitment to delivering broadband to the people and should be commended. We would however ask them to set out a timetable for when these exchanges will be upgraded as consumers are tiring of hearing ‘real soon now’.”

The announcement means that 900 of the 1100 eircom exchanges will eventually offer broadband to consumers and businesses.

Mulley did however warn that people will still be disappointed as the announcement still does not mean everyone can get broadband.

“200 eircom exchanges are still not on any upgrade list and because eircom’s network hasn’t been cared for well in the past, many people while connected to a broadband exchange cannot get broadband because of the poor quality of lines. Until these are addressed, people both in cities and in rural areas still won’t be able to get broadband.”, Mulley added.

Previous to this, if a customer was with UTV or another DSL reseller and wanted to move to Smart or Magnet, they would first have to cancel their service, move to eircom and then order the LLU service. This will no longer happen.

The announcement from eircom however does not allow for a seamless transition from customers on a resold package to an LLU package if they are with the same company. This process known as intra-operator migration means that companies like BT and Digiweb who resell eircom products as well as offer their own LLU products, cannot move their customers over without disruption.

[1]BitStream is a an eircom wholesale product that can be resold by companies like UTV, Imagine, BT Ireland etc. eircom dictate the wholesale price of the product and the speeds of a product.

[2]LLU (Local loop unbundling) is the putting of competitor owned broadband equipment in eircom exchanges which allows competitors to offering their own designed broadband and voice products. LLU in Europe has been a main driver of broadband uptake. LLU in Ireland has been around since 2001 on paper but in practice it has been so flawed that it has largely remained unworkable.

IrelandOffline have previously highlighted ComReg reports which show that the LLU process in Ireland does not work properly.

IrelandOffline would like to draw your attention to the following facts not mentioned in the press release from ComReg about their latest survey data:

On page pg 17 of this ComReg report: “In Q4 2006, 28% of internet subscribers who use a narrowband subscription reported they had attempted to subscribe to a broadband service to be told it was unavailable to them.”

IrelandOffline statement from Damien Mulley “ComReg have released a report and are once again talking about ways of stimulating demand yet at the same time are trying to bury the fact that almost 1 in 3 people on dialup Internet access cannot switch to broadband. IrelandOffline seriously questions the motivations of a telecoms regulator who are ignoring the plight of a massive proportion of the population and who offer no remedy to their situation.”

Some other facts from the ComReg data:

From page 10 of this ComReg report: 21% of those without phonelines said they are not getting phone lines due to high cost of line rental and calls. (14% say fixed costs are too high and 7% say line rental and connection costs are too high = 21% )

Ireland currently has the highest line rental in the EU at €24.17. The EU average is 8 euros per month cheaper.

4% of people who do not have a phoneline are in fact waiting to get one.

Analysis of Report
Page 4: “Eircom’s contention remains that there is no need to move to Phase 2 in the immediate future as Phase 1a will cope with any volumes deriving from consumer marketing of the product.

ComReg and operators are considering this position but given the long timelines suggested by eircom to implement Phase 2 (12 months) the operators have expressed a desire for the development to begin immediately in case the Phase 1a processes result in operators experiencing difficulties as order volumes increase.”

Explanation: The current ordering system for a local loop unbundled powered product is a manual system, meaning that a person from an alternative operator takes a customers details, sends them over to eircom, where someone from eircom then takes this information and inputs it into an eircom system. This system cannot work for bulk orders as it depends on the number of people processing data that a machine should be doing.

Eircom are refusing to develop an ordering system telling operators there is no need, despite the 50% fault rate with the current system (see below). Even if an automated system were developed, eircom are telling ComReg it will take them 12 months to develop such a system. With current negotiations, an automated ordering system is years away. An automated system would speed up the delivery of broadband to a customer but would also allow mass transfer of customers from a resold eircom product to an in-house developed product by Smart, BT or Magnet.

Page 5: “The data provided would indicate that more than 50% of orders, at various stages of processing, in any one month are being rejected or result in non-delivery of service.”

Explanation: This Menas that with the current manual process 1 out of every 2 orders are not going through as they should and a consumer is further delayed from getting broadband. Generally this results in downtime of phone and broadband service, which many businesses cannot afford and as a result the attrition rate from bitstream products to LLU products will remain low. Seamless movement from one service to another is what has allowed the mobile industry to thrive in Ireland and why usage in Ireland stands at 102% for mobiles. The stats in this report show that it is a matter of luck that someone has a smooth
transition from an eircom or eircom resold broadband product to an LLU product.

A graph on page 7 shows the significant percentage of orders delayed by the ordering system.

“These figures are a startling testimonial to the lack of urgency and motivation shown by the telecoms regulator (ComReg) and the Department of Communications regarding the severe digital divide between Ireland and the rest of Europe.

Instead of closing the gap between us and our EU counterparts, these figures clearly show the gap is widening and IrelandOffline calls on the Government, and in particular Communications Minister Noel Dempsey, to immediately introduce the already overdue, but much needed, Telecoms Bill.”