ComReg may reduce leased-line regulation
Friday, 4 June 2004ComReg proposes to cut Eircom loose in the the high-bandwidth section of the leased line market, having decided that there is sufficient competition in the sector.
The changes would have most effect upon large corporate and multi-national companies, particularly those which operate large call centres. Companies such as Microsoft, Dell, Lufthansa and Hertz operate large call centres within the state, servicing European or even global markets.
In the market for high bandwidth leased lines, both domestic and international, Eircom would no longer be deemed to have significant market power (SMP) and will be free to act in the market as they will.
Competitors to Eircom in this area include companies such as Cable & Wireless, MCI and Global Crossing.
However, the restrictions placed upon Eircom in the retail market for lower bandwidth leased lines would be left in place, because ComReg deems competition in this area to be insufficient. These lines often have a bandwidth of less than 2 megabits per second (mbps) and are often used by SMEs or by larger companies to link their branches to headquarters.
Restrictions would also be left in place in the wholesale leased line market.
Eircom's recent results, showed that for the year to the end of March, Eircom had about EUR136 million in sales from leased lines, representing about 8 percent of its total business. But the figures also showed that the number of lines it leases are down 7 percent to just under 28,000.
