Eircom claims regulatory all-clear for cable TV hikes discriminatory

Eircom has described the telecoms regulator's decision to sanction prices rises of up to 34 per cent for cable TV firms as "inappropriate…

Eircom has described the telecoms regulator's decision to sanction prices rises of up to 34 per cent for cable TV firms as "inappropriate" and "discriminatory".

It also accuses Ms Etain Doyle of inconsistent regulation across different communications sectors and calls on her to implement unbundling of cable networks.

The sharp criticism by Eircom comes as consumers begin to feel the impact of price rises introduced by cable TV firms NTL and Chorus earlier this month.

Chorus has increased prices by as much as 29 per cent in some areas, while NTL has increased prices by 34 per cent in Dublin, and by 14 per cent in Waterford and Galway.

READ MORE

Eircom made its comments about the regulator's decision in a consultation document on the price increases sent to Ms Doyle's office in mid-September.

In the document, seen by The Irish Times, Eircom expresses concern that NTL and Chorus are being allowed to increase TV prices to fund upgrades to their networks, which will enable the firms to compete in the telecoms market.

"Each cable and MMDS licensee should be obliged to provide evidence that it is not using its dominance in TV transmission to cross-subsidise its entry into separate down-stream telecoms services." Earlier this year, both cable TV firms delayed digital upgrade programmes that would have enabled them to offer telecoms and broadband internet services over their networks.

The failure to complete alternative digital networks has greatly reduced the competition in the telecoms market for Eircom.

The telecoms regulator made the price rises conditional on NTL and Chorus completing their digital upgrades and has set out revised timetables for the firms.

In the consultation document, Eircom describes Ms Doyle's approach to regulation as inconsistent across different sectors such as cable and telecoms, and discriminatory against Eircom.

The firm also calls for the unbundling of cable TV networks.

"The approval to raise retail prices to finance access infrastructure where NTL and Chorus have a monopoly should only be allowed if their upgrade access networks are offered on an unbundled basis to all competing companies, including telecoms companies and internet service providers."

Unbundling, a process of opening a telecoms or cable network to competition, has been mandated by the European Commission for incumbent telecoms firms such as Eircom, but not for cable TV firms. Eircom is suing the telecoms regulator over her decision to make it open its local network at lower prices than those proposed by the firm.

Contacted by The Irish Times yesterday, a telecoms regulator spokeswoman said the question of accessing the Chorus and NTL networks does not arise because the cable networks are not currently capable of supporting such access.

"When their networks are capable of supporting open access we will consider it," she said.

Mr Ed Brophy, head of regulatory affairs at NTL, said the allegation of cross-subsidisation was nonsense as the price increase "only allows us to make a return on our TV product".

Mr Willie Fagan, director of regulatory affairs for Chorus, said the firm would provide separated accounts to the regulator to meet any concerns on cross-subsidisation.

More than 200 responses to the consultation process on price rises were received from members of the public and community groups.Most criticised the proposed price increases because of poor levels of service from both cable firms.

The consultation process received 78 letters about NTL and 136 replies about Chorus.

Surprisingly, the director of consumer affairs office's reply to the consultation process did not address the pricing issue at all. It read: "I wish to advise that we have no views on the matter."

Ms Carmel Foley, director of consumer affairs, said yesterday her office did not express a view on the increases because it was regulated by the telecoms regulator.