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Esat BT to launch residential VoIP

Challenging Eircom

Esat BT has vowed to redouble its efforts to gain voice telephony market share, but may ultimately pursue it through voice over IP (VoIP) rather than traditional fixed lines.

Ireland's second largest telecoms company said that decisive action by ComReg and the government on the issues of wholesale line rental and single billing were immensely helpful to the company and would help it to make in-roads into Eircom's dominant market share.

But ComReg's actions will also help the other CPS operators in the fixed-line telephony market and Esat BT's CEO Bill Murphy acknowledged that the telephony market will continue to be "challenging". He further stated that Esat BT would continue its involvement with the Irish voice market, whether through fixed lines or through emerging voice over VoIP technology.

"We are a network company, the network is at the very heart of the business," said Bill Murphy, CEO of Esat BT. "But the new wave is in broadband and integrated solutions, integrating data and voice."

In line with its parent company BT, Esat BT is focusing on this "new wave" of businesses encompassing broadband, networks and managed services. Accordingly, it has announced a new product to the Irish market, whereby it will offer a hosted VoIP (voice over IP) service to its corporate, government and SME customers. This will allow customers to route voice calls across data networks and the Internet with no per minute costs and without investing in expensive infrastructure. The service would also provide a data network between offices and would connect to the PSDN telephone network to make calls to people who are not part of the VoIP network.

Esat BT says that it intends to extend the service to residential customers within three months and says that the service is already available to UK residential customers. Residential customers would plug an adapter into their PC, connect to the Internet using a DSL connection and then use headphones and a microphone to make voice calls.

"Voice and data will converge and fixed line will go away," said Murphy. "If I were Eircom I'd be very worried about hosted VoIP."

The new product comes on the back of better financial results from the company, which has been striving for profitability for a number of years. The company announced turnover of EUR289 million for the 2004 financial year, up 20 per cent from the 2003 financial year. The company has also cut operational expenditure by 18 per cent, by reducing its debt, consolidating its offices and disposing of non-core businesses.

Esat BT also announced that it is cash-flow positive and expects to make a profit in the current financial year. The company has been cutting its losses steadily over the past few years, from around €500m in 2002, €159m in 2003, but only €42m in the 2004 financial year.

© ENN

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