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Eircom introduces ‘low-cost’ broadband

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Eircom has formally introduced a cheaper broadband product, which the government and lobby groups have warmly welcomed.

Called "I-stream Starter", the new broadband Internet product from Eircom will sell for EUR45 per month (ex VAT), and a self-install version will be available that cuts the installation price of ADSL by 50 percent to EUR81.81, excluding VAT. Eircom's existing consumer DSL service costs about twice as much, both in terms of monthly fees and connection costs. The new I-stream product will be available from 11 April.

I-stream Starter will offer guaranteed download speeds of 512kbs, although upload rates may be slower for some customers, depending on a variety of circumstances. The new service will be available to about 700,000 lines around Ireland, Eircom said, extending to 1 million by year's end.

The company explained that I-stream Starter will cover the greater Dublin commuter area, provincial cities, large provincial towns and all towns included in the government's national spatial strategy. Eircom said it would embark on an "information campaign" to promote the new service.

The former Irish telecoms monopoly added that the new service will extend the reach of broadband availability. Previously would-be broadband customers needed to live within 3.5 kilometres of an exchange, but this radius has now been widened to 4.5km.

Although the news has been expected for some time, and the move was initially greeted with rage from competitors, the government and consumer group Ireland Offline welcomed Wednesday's news. Minister for Communications Dermot Ahern, who has been outspoken about his desire to see low-cost consumer broadband rolled out, predicted that the service would be a popular one.

"Allied to the introduction of flat-rate [dial-up] Internet access -- something which I have also made one of my priorities and which I expect to be introduced towards the end of June -- we are putting in place the environment which will drive significant demand," Minister Ahern said in a statement. "I have always said that we needed to drive down access prices in order to deliver on the e-commerce agenda."

The Minister hinted that other companies might enter the "low-cost broadband" fray, and indeed Esat BT has said it plans to offer a competitive product this summer. UTV Internet is also expected to launch a new ADSL product.

Earlier this year, Esat BT reacted angrily to Eircom's plans to roll out this cheaper product, complaining that the former monopoly had done so without submitting wholesale prices to communications regulator ComReg so that other operators could also sell a service. Last month, it was revealed that ComReg had approved Eircom's wholesale price of EUR27.

For its part, consumer and lobby group Ireland Offline welcomed the move, with chairman David Long saying "It's great to see the price come down by about 50 percent. We're really pleased on that front." But Long warned that the service needed to be extended to as many customers as possible and said that further price cuts of approximately EUR10 would cause demand to triple, citing ComReg and MRBI polls from last year. "We've got to get down to that magic figure," he said. © ENN

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