Last month's Government decision that the Irish telecoms market is to be fully liberalised one year earlier than originally planned means a one-and-a-half-year slog towards full deregulation has become a six-month dash. There's a lot of work to be done in a short time, and among the first issues to be addressed are the telephone numbering scheme and the rates operators charge each other for routing calls from one network to another, known as interconnect agreements.
The burden of rapid liberalisation falls on the Office of the Director of Telecommunications Regulation (ODTR), which has said it will publish papers later this month on both the numbering scheme and the interconnect rates. Both issues are big. Consumers and business users want few number changes and maximum number portability, whereby they retain the same number if switching operators. Meanwhile, interconnect rates will be central to the profitability of new and incumbent operators.
Number changes are necessary as new services and new operators come online, but nobody likes them. The regulator, Ms Etain Doyle, told a conference on regulatory issues in Dublin last week that her office would this month publish a decision following consultation on how best to develop the country's telephone numbering plan. She said additional services and new operators would mean additional codes (prefixes) would have to be introduced without the usual 12-months notice. However, following the conference she acknowledged there was a strong desire for a single large change to the numbering scheme rather than many smaller changes.
The impact of number changes can be seen from a change already under way in the Internet service industry. On May 28th, Telecom Eireann announced that from the beginning of July it would lengthen from three minutes to five minutes the time per unit on peak-rate calls to Internet service providers (ISPs). While potentially cutting customers' telephone bills, this will require ISPs to put new four-digit prefixes before their numbers, meaning every computer which uses a modem for dial-up Internet access will have to change the number it calls. Telecom Eireann stresses that all ISPs, including its own Indigo and Tinet, will be affected.
While welcoming the resultant cheaper Internet access for its users, the state's largest ISP, Ireland On-Line is less than pleased with the timing and suddenness of the announcement. "The timing and consultancy aspects were a little bit wanting," says creative and technical director, Mr Barry Flanagan. He says that expecting a large amount of IOL's 40,000 or so customers to want to change to the new number immediately "has landed us with a logistical nightmare".
Between reissuing CD-Roms, additional technical support, and additional resources to cater for increased Internet demand, he expects the change to cost IOL hundreds of thousands of pounds. IOL claims to be the second-largest generator of call-minutes in the state after the directory enquiries service.
Telecom, recognising the difficulty, is offering to share the cost of a joint marketing effort to publicise the changes in order to minimise the impact on ISPs' customer support centres. It is also going to allow customers to continue to use the existing numbers for "a minimum of three months", according to a spokeswoman. However, the message is clear: number changes cause headaches, even when part of progress.
More positively, Mr Barry Flanagan says the liberalised market should allow IOL which claims to be the second-largest generator of call-minutes in the state after the directory enquiries service to strike a deal with a telecoms operator whereby IOL gets a share of the call units generated by its customers. This is already the case in Britain where last month one ISP, Easynet, announced an interconnect agreement with British Telecom.
Interconnect agreements usually apply when calls from one operator's network are routed onto a second operator's network. As the first operator bills the customer, the second operator in turn bills the first for completing or "terminating" the call. Easynet Group chairman and CEO, Mr David Roe, says its interconnect agreement followed 18 months of talks with BT, and that it had to install a £2 million sterling switch in order to terminate calls from BT's network.
He says he is "under duty of care" not to reveal the details of the interconnect agreement, but the outcome is that though Easynet pays BT for the long-haul part of its customers' Internet access calls, it recoups some of this money by charging BT for terminating the calls on Easynet's switch. The customers only pay local-call rates, even though the calls all terminate on Easynet's switch.
Interconnect rates are likely to be central to the haggling between the various operators in the months leading up to full liberalisation here. At last week's conference both Esat and WorldCom accused Telecom Eireann of charging 8p per minute interconnect rates, even for local calls, a figure disputed by Telecom's chief executive, Mr Alfie Kane, who wouldn't, however, give his own figure. WorldCom Ireland's chief executive, Mr Sean Melly, said his organisation could connect calls to the US for as little as 3p per minute, and that interconnect rates in Britain were 0.7p.
Meanwhile, at the same conference Esat Telecom's chief executive, Mr Sean Corkery, put his case for lower interconnect rates being granted to operators who have invested in infrastructure. If granted, this would give companies like Esat, which has built its own network, an advantage over re-sellers who lease network bandwidth and sell value-added services over it. Mr Corkery promised Esat would be in the domestic market on January 1st next, by which time he expected the interconnect rate to be about 1p per minute.
The ODTR has to sort out these key issues. While a decision on numbering is promised by the end of this month, the interconnect issue will take longer. Ms Doyle says her office will publish a paper on the broad issue of network interconnection this month, but an agreement on interconnect rates is not expected until autumn. By December, these and all other pieces of the liberalisation jigsaw will have to be in place.
Eoin Licken can be reached at elicken@irish-times.ie
