Eircom will not be allowed to increase the price of telephone line rental next year, the Commission for Communication Regulation (ComReg) said yesterday.
The company may also face the imposition of a regulatory price cap on its retail line rental service, according to Ms Isolde Goggin, ComReg's chairwoman.
In an interview with The Irish Times, Ms Goggin said the commission believed that Eircom's monthly fee for telephone lines was already high enough to recover its own costs.
A further increase in line rental is not justified, she added.
She said ComReg was currently considering imposing a special sub cap on Eircom's retail line rental prices early in the new year.
ComReg's views on the cap are contained in a consultation document which proposes either freezing line rental at its current price or allowing Eircom to increase it in line with inflation.
Eircom currently charges consumers € 24.18 per month for line rental, the highest fee within the EU and almost €10 higher than the average European line price.
The firm typically applies to ComReg for a line rental price increase in January, which normally takes effect in February.
But Eircom's decision to raise line rental prices for the third time in 12 months this February sparked a public outcry causing the previous Minister for Communications, Mr Dermot Ahern, to issue directions to ComReg.
The policy directions told ComReg to force Eircom to offer wholesale line rental to competitors, a process whereby rivals offer line rental to customers.
They also asked ComReg to consider setting a specific price cap on Eircom's line rental prices to protect consumers.
Ms Goggin confirmed yesterday that ComReg was firmly against allowing Eircom to hike the price of line rental any further.
She also said that ComReg would issue a decision shortly on setting a line rental price cap.
Eircom refused to comment on the issue of line rental prices.
Meanwhile, Ms Goggin said that the commission had no objection to telecoms firms supplying digital television services over ordinary copper phone lines.
She said ComReg expected to see more advanced types of broadband technology in the new year.
