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Eircom sets wholesale DSL price

'Positive development'

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Esat BT has described Eircom's new wholesale price for DSL as positive, with both firms now set to roll out retail services at dramatically lower prices.

Earlier this year, Eircom said it planned to introduce a retail DSL Internet service for about €50 a month (€45 excluding VAT), about half the price of the company's existing retail service. The move infuriated rivals, particularly Esat BT, which is paying Eircom €55 per line for wholesale DSL services.

It is understood that Eircom has now submitted a new wholesale price to Irish communications regulator ComReg and will begin selling cheaper DSL services to entrant telecoms like Esat BT and UTV Internet for €27 per line per month. This price is for a 512Kb/s rate adaptive service, which means that certain factors could reduce the connection speed, although Eircom says a minimum of 256kb/s is guaranteed.

Although the prices have been published, and ComReg is said to have approved them, Eircom has passed little comment on the move, with a spokesperson simply saying, "We are glad to get this underway." Most other charges that relate to DSL are set to remain the same, including connection fees, which on a wholesale basis will be €150 per subscriber. Eircom did, however, say it hoped to introduce a "self-install" DSL product in the coming months.

East BT, meanwhile, said it is happy with the prices. "At EUR27, it's a positive development and it's something we certainly think we can work with," said Una McGirr, communications director for Esat BT. McGirr said that Esat BT was "crunching the numbers" to come up with a proposed retail price for its own service, and it is expected that Esat BT's new product will be launched in late spring or early summer at "competitive" prices.

The move is sure to be welcomed by the government, industry and consumer groups such as Ireland Offline, which has long lobbied for affordable broadband for consumers. Similarly, Communications Minister Dermot Ahern has led the charge for low-cost DSL, and last month he launched a new commission to investigate ways to encourage take-up of the service and make rollout as affordable as possible.

The most recent figures from ComReg show that only around 3,300 DSL lines have been ordered in Ireland since its launch nearly a year ago, and the current €100 per month retail price is often blamed for the poor uptake.

Recent research by market analyst Datamonitor estimated that there were 10 million broadband lines in Europe at the end of 2002, but the company predicts there will be 41 million by 2006. However, Datamonitor says that retail prices will eventually need to fall to as low as €24 per month in order for the technology to become widespread. © ENN

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