More than 16,000 people have signed up for a new broadband service offered by Smart Telecom that may not be available for up to five months.

The company disclosed yesterday that it had received the applications along with customers' direct debit details for its €35 broadband and line rental offer.

The service, which was publicised three weeks ago by the company, offers customers a broadband connection at speeds of two megabytes per second and their regular line rental for the flat fee.

Smart Telecom chief executive Oisín Fanning said customer demand had been phenomenal since the offer started.

He said the first few customers were connected last week and the other customers would be connected when the nearest telephone exchanges were unbundled. This process would take up to five months to complete for some customers as the firm had to place its equipment in Eircom's telephone exchanges.

Smart Telecom, which has raised about €50 million since it was founded in 2000, is the first competitor to Eircom to aggressively seek to unbundle "the local loop" - opening the last mile of an incumbent telecom operator's network for use by rival firms.

Mr Fanning said that the firm had successfully unbundled four of Eircom's telephone exchanges in Clondalkin, Dolphin's Barn, Ship Street and Summerhill. He said another 62 would be unbundled by July or August.

People who signed up for the offer would be connected as soon as their local exchange was opened to Smart Telecom and Eircom transferred their line.

Mr Fanning said that Eircom had agreed to transfer up to 5,000 customers per month using the company's manual processes but said that he hoped an automated transfer process would be introduced shortly to help customers transfer.

Smart Telecom has attracted 80,000 telephone customers, of which 55,000 had also signed up to have their line rental managed by the firm, added Mr Fanning.