Eircom
Encyclopedia
Eircom Group LTD is a telecommunications company in the Republic of Ireland
, and a former state-owned incumbent. It is currently the largest telecommunications operator in the Republic of Ireland and operates primarily on the island of Ireland
, with a point of presence in Great Britain
.
As Bord Telecom Éireann
, the company was (until 1999) a state monopoly; as a private company, it continues to dominate many telecommunications areas. Its main competitors are UPC Ireland
(which operates its own cable network), Vodafone Ireland
(which bought BT Ireland
's residential customer base on 22 July 2009 and is accessed through Eircom's network and BT Ireland's fibre), Imagine Communications
(Irish Broadband & Gaelic Telecom) and Magnet Networks
and Smart Telecom
, with a mix of LLU
/GLUMP
from Eircom and fibre.
Eircom currently operates the fixed-line telephone network, a HSDPA (3G
) and GSM/EDGE
(2.75G) mobile telephone network Meteor (acquired from AllTel (Western Wireless) in 2005) and acts as an internet service provider
(ISP) Eircom.net. Eircom also operates a property-alarm installation and monitoring unit called Eircom Phonewatch. Eircom broadband had a 49% share in 2006, and Eircom fixed voice lines 72% in 2006. Current market share analysis is at comreg's site. By late 2007 Eircom added their 500 thousandth DSL subscriber but broadband share may have fallen to 44% due to growth of fixed wireless, cable and fibre services.
Since its privatization
in 1999, the company has been repeatedly loaded with debt
and asset stripped
by domestic and foreign speculators
. As a result, despite the company annually generating a profit
, it is currently enacting wage cuts and redundancies
.
As of July 2011, Eircom have total revenues of €360,000,000 in the bank.
, under licence from the Commission for Communications Regulation
. Most homes and businesses in the state are connected by this network. A full range of telecommunications services is provided on the network including Business IP, its MPLS
platform. Eircom have also completed a wholly owned fibre network ring around Northern Ireland and another around Belfast. Their ISP division, Eircom Net, provides dial-up services, as well as broadband services (see broadband roll-out, below). Eircom Phonewatch provides burglar-alarm
and home monitoring services. Any alarm-monitoring products using SMS are "hardcoded" to work with Eircom's SMSC, so will not work on Digiweb, BT, Smart, UPC or Magnet phone networks. DECT SMS handsets are also preprogrammed for Eircom's SMSC. Any competing phone service that is not just carrier pre-selection (CPS) of Eircom must provide their own SMSC, but even when they do, consumers may be unable to migrate from Eircom due to SMSC numbers in equipment that cannot be reprogrammed.
Eircom's mobile arm, Meteor, provides a full range of HSPA
/(3G
) and GSM-based mobile communication services throughout the Republic of Ireland. Its GSM network operates at 1800 MHz and 900 MHz ranges, as the earlier GSM licences fully utilised the 900 MHz band. GPRS and EDGE
data services are also available. Meteor have recently launched HSPA
(3G
Mobile Broadband) services in Dublin, Cork, Dundalk and Drogheda. Meteor provides both bill-pay (contract) and pre-pay (non-contract) plans and has approximately 19% of the Irish mobile market, with 1,032,000 cellular subscribers on the Meteor Network. The company has used EDGE technology on its network and has received a 3G
(UMTS) licence, formerly removed from Eircom's competitor, Smart Telecom
(This required 33% of the population to be covered by 3G
by September 2008.)
As an operator with significant market power, Eircom is required to provide a number of wholesale products to other operators and to switch calls onto other phone networks. Many broadband products offered by other operators are resales of the Eircom product.
Eircom's PhoneWatch subsidiary provides monitored burglar alarms, fire alarms, CCTV systems, and medical alert devices.
, see: Telecom Éireann
.
From 2000 to 2008, Eircom sponsored the League of Ireland
.
laws requiring the opening up of the Irish telecommunications market; however, Ireland had a derogation from competition until 2003. Telecom Éireann was privatised, this was very controversial and subject to much debate. The process began in 1995, and by July 1999 the government had disposed of virtually all of its shareholding. Eircom plc was then floated on the Irish Stock Exchange
, London Stock Exchange
, and New York Stock Exchange
on 8 July 1999 and small/first-time investors were encouraged by the Irish Government
to buy shares. The share price was set at €3.90. It later reached a high of €4.80, a 23% increase. Those initial investors who held onto their shares, until July 2000, received a 4% bonus-share allocation.
The Eircom flotation is considered to have been an example of a stock market bubble
— after the initial hype of the flotation died down, the stock price fell rapidly. Many of the 500,000 small investors were angered by the significant financial loss they incurred, blaming the government for not sufficiently warning them of the risks inherent in stock-market investment.
Since privatisation Eircom penetration of landlines has fallen from 82% to 69%. During this period, there has been a large increase in mobile phone ownership and a significant rise in line rental to the highest in Europe.
In 2001, Eircom sold its mobile subsidiary Eircell
to Vodafone
. The company was transferred to a separate entity, Eircell 2000 plc which was then sold to Vodafone in a share swap. Eircom shareholders got 1 Eircell 2000 share for 1 eircom share. The conversion rate was then 0.9478 Vodafone shares for every 2 Eircell 2000 shares. This left the Eircom shareholder with not only shares in Eircom, but Vodafone also.
After the sale of Eircell, Eircom itself was believed to be undervalued and became the subject of a bidding war between two consortia: the E-Island consortium headed by Denis O'Brien
, and the Valentia Consortium headed by Tony O'Reilly, the chairman of Independent News and Media. Eventually in November 2001, the company agreed to a recommended offer of €1.335 per Eircom share. Eircom Plc was delisted from the stock exchange, become Eircom Limited, a private limited company by shares and a subsidiary of Valentia, and O'Reilly took the reins as Executive Chairman (a role he pursued with vigour, even holding management meetings at his Castlemartin
home).
On 19 March 2004, the company returned to the stock market (although the company being listed, Eircom Group plc, was in fact a new holding company, and was registered in England and Wales
rather than the Republic of Ireland
). The company floated at €1.55 a share, but dipped on initial trading before recovering to trade above its float price.
that there had been three bidders for Meteor: Eircom, Smart Telecom
, and a consortium led by Denis O'Brien
. On 14 July 2005 RTÉ News
reported on their business website that Denis O'Brien had withdrawn from bidding, and that it was understood that Eircom was the top bidder at €410 million. On 21 July, it was announced that Smart Telecom had also withdrawn, leaving Eircom as the sole bidder. Eircom announced the agreement to purchase it on 25 July 2005 at a cost of €420m.
As of September 2008, Meteor (mobile) had over 1,000,000 customers and a market share of 30%, offering both GSM and 3G mobile telephony and broadband services.
, Eircom own and operate a fibre-optic network ring around Belfast and Northern Ireland, linking into the national Eircom Network in the rest of Ireland. Eircom NI have won significant contracts thus far, the largest being the €100m "Network NI" contract for the Northern Ireland Civil Service
, with other significant contracts as operator of choice for Northern Ireland Water and Viridian
. The company in Northern Ireland currently provides services to local government and SME sectors.
telecommunications company, Swisscom
AG, had made an approach to Eircom regarding a possible takeover of the company. On 25 November 2005, the Swiss government
announced that it would use its controlling stake in Swisscom to block any foreign takeovers, effectively ending hopes of a bid.
in a deal worth €2.4 billion. The Employee Share Ownership Trust, which represents workers at the company, was to remain a minority shareholder. The sale was approved by shareholders on 26 July 2006, and at close of business on 17 August 2006, the shares were delisted from the Official Lists of the Irish Stock Exchange and the London Stock Exchange, ending Eircom's second period on the stock markets. The same day, Phillip Nolan resigned as chief executive
of Eircom, and on 1 September Rex Comb was officially named as the new CEO. Tony O'Reilly resigned as Chairman and was replaced by Pierre Danon
, previously of BT Group plc and JP Morgan Chase.
Babcock and Brown have since collapsed as a company and their BCM vehicle, which owns over 50% of Eircom, broke all ties with the former parent and rebranded themselves as Eircom Holdings Limited.
and Chorus), Digiweb Metro and some fibre offerings from BT, Magnet Networks
, Smart and Digiweb). Chorus
previously offered wireless telephony but failed to renew their licence. Eircom is required to allow carrier pre-selection (CPS). Introduced in Ireland in 2001, CPS allows subscribers to use an alternative provider for all their calls, without the need to dial indirect access codes or numbers, although they still receive a bill from Eircom for line rental. Under a wholesale line rental scheme, it is possible for customers, to have a single bill from an alternative provider, for example, BT Ireland
, including the cost of Eircom line rental, rather than continuing to receive a separate one from Eircom for this cost. Unlike the UK, where BT's competitors now can charge less than BT for line rental, it is not yet possible for operators in Ireland to buy the lines from Eircom and charge their own rate for line rental, should they wish.
by the large investors with interests in Eircom.
Eircom announced in June 2007 that from 30 July line rental charges would increase by €1.18 bringing line rental charges – already the most expensive in Europe to a total of €25.36 per month for a PSTN analogue line, one source indicated it was the highest line-rental charge in the world. Also announced was an increase of between 4.8 and 4.9% on local and national calls.
In March 2011, Eircom pleaded guilty to a breach of the Data Protection Act, at the Dublin District Court.
On 1 November 2007, Eircom announced their 500,000th DSL customer.
In terms of speed and availability, Eircom exchanges can only deliver broadband to houses within 5 km (3.1 mi) in most of its exchanges and will not be investing in fibre optic or next-generation broadband, as stated in a meeting with members of Dáil Éireann in late 2008 about broadband availability. In 2011 Eircom announced that they would invest €100 million on high speed fibre optic lines which would be delivered as a pilot scheme to customers in Dublin and Wexford.
Currently, Eircom users who try to access The Pirate Bay receive the following message:
Since September 2009, The Pirate Bay website and trackers have remained blocked by eircom.
(Irish equivalent of the RIAA) to activate a "three strikes system" so it will ban users from the internet for 12 months if they appear to be downloading copyrighted content through peer to peer filesharing networks.
, Eircom and Setanta Sports
), announced that OneVision is to enter negotiations with the BCI, with the view to takeover operations of the Irish pay DTT service. If negotiations are deemed successful, it may see the launch of DTT in late 2010/early 2011 at a proposed operation cost of €40 million. OneVision aspire to offer 23 channels coinciding with the free-to-air channels. For further information on the subject, see: One Vision (DTT)
. Eircom is majority stakeholder in this project.
Republic of Ireland
Ireland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...
, and a former state-owned incumbent. It is currently the largest telecommunications operator in the Republic of Ireland and operates primarily on the island of Ireland
Ireland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
, with a point of presence in Great Britain
Great Britain
Great Britain or Britain is an island situated to the northwest of Continental Europe. It is the ninth largest island in the world, and the largest European island, as well as the largest of the British Isles...
.
As Bord Telecom Éireann
Telecom Éireann
Telecom Éireann, or formally Bord Telecom Éireann - The Irish Telecommunications Board, was created by the Postal & Telecommunications Services Act, 1983 from the Department of Posts and Telegraphs, Ireland, under the leadership of the Minister for Posts & Telegraphs...
, the company was (until 1999) a state monopoly; as a private company, it continues to dominate many telecommunications areas. Its main competitors are UPC Ireland
UPC Ireland
UPC Ireland is Liberty Global Europe's telecommunications operation in Ireland. UPC Ireland is the largest digital cable television provider within the Republic of Ireland. As of September 2010 the company offers broadband internet, digital television and digital telephony to over 531,000 customers...
(which operates its own cable network), Vodafone Ireland
Vodafone Ireland
Vodafone Ireland Limited, part of the Vodafone Group, is the largest mobile phone company in Ireland in terms of active subscribers, and was previously called Eircell. The mobile phone system in use is a digital GSM 900 system, and also a third-generation UMTS system...
(which bought BT Ireland
BT Ireland
BT Communications Limited is a telecommunications and internet company in Ireland. It is a subsidiary of BT Group plc.-Esat Telecom:The company was founded in 1990 by Denis O'Brien, and was originally known as Esat Telecom...
's residential customer base on 22 July 2009 and is accessed through Eircom's network and BT Ireland's fibre), Imagine Communications
Imagine Communications
Imagine Communications is an Irish internet service provider and telecommunications operator, who provide WiMAX, wireless broadband and resell Eircom telecommunications wholesale packages...
(Irish Broadband & Gaelic Telecom) and Magnet Networks
Magnet Networks
Magnet Networks is an Irish company providing telephone, television and internet services via subscription over optical fibre.Magnet Networks was launched in Dublin on 1 December 2004, and is a wholly owned subsidiary of US-based international investment company Columbia Ventures Corporation...
and Smart Telecom
Smart Telecom
Smart Telecom is an Irish telecom operator that started as a phone card seller. It is also the third largest provider of cost-sensitive telecom services sector in Ireland, behind the incumbent operator Eircom and BT Ireland. It currently has an estimated 50,000 land-line customers and 18,000...
, with a mix of LLU
LLU
LLU is a three-letter abbreviation which may refer to the following:* Alluitsup Paa Heliport , in Alluitsup Paa, Greenland* Local-loop unbundling* Loma Linda University...
/GLUMP
GLUMP
Geographic Number Portability Unbundled Line Metallic Path or GLUMP is a product related to Local Loop Unbundling in Ireland. Geographic Number Portability is the process of a user moving their number to a new address. Local Loop Unbundling is the process of a line being used by a 3rd party to...
from Eircom and fibre.
Eircom currently operates the fixed-line telephone network, a HSDPA (3G
3G
3G or 3rd generation mobile telecommunications is a generation of standards for mobile phones and mobile telecommunication services fulfilling the International Mobile Telecommunications-2000 specifications by the International Telecommunication Union...
) and GSM/EDGE
Edge
- Aviation :* Leading edge, a line connecting the forward-most points of a wing's profile* Trailing edge, the rear edge of the wing* Zivko Edge 540, an aerobatic aircraft- Mathematics, science and technology :...
(2.75G) mobile telephone network Meteor (acquired from AllTel (Western Wireless) in 2005) and acts as an internet service provider
Internet service provider
An Internet service provider is a company that provides access to the Internet. Access ISPs directly connect customers to the Internet using copper wires, wireless or fiber-optic connections. Hosting ISPs lease server space for smaller businesses and host other people servers...
(ISP) Eircom.net. Eircom also operates a property-alarm installation and monitoring unit called Eircom Phonewatch. Eircom broadband had a 49% share in 2006, and Eircom fixed voice lines 72% in 2006. Current market share analysis is at comreg's site. By late 2007 Eircom added their 500 thousandth DSL subscriber but broadband share may have fallen to 44% due to growth of fixed wireless, cable and fibre services.
Since its privatization
Privatization
Privatization is the incidence or process of transferring ownership of a business, enterprise, agency or public service from the public sector to the private sector or to private non-profit organizations...
in 1999, the company has been repeatedly loaded with debt
Debt
A debt is an obligation owed by one party to a second party, the creditor; usually this refers to assets granted by the creditor to the debtor, but the term can also be used metaphorically to cover moral obligations and other interactions not based on economic value.A debt is created when a...
and asset stripped
Asset stripping
Asset stripping involves selling the assets of a business individually at a profit. The term is generally used in a pejorative sense as such activity is not considered productive to the economy. Asset stripping is considered to be a problem in economies such as Russia or China that are making a...
by domestic and foreign speculators
Speculation
In finance, speculation is a financial action that does not promise safety of the initial investment along with the return on the principal sum...
. As a result, despite the company annually generating a profit
Earnings before interest and taxes
In accounting and finance, earnings before interest and taxes is a measure of a firm's profit that excludes interest and income tax expenses. Operating income is the difference between operating revenues and operating expenses...
, it is currently enacting wage cuts and redundancies
Layoff
Layoff , also called redundancy in the UK, is the temporary suspension or permanent termination of employment of an employee or a group of employees for business reasons, such as when certain positions are no longer necessary or when a business slow-down occurs...
.
As of July 2011, Eircom have total revenues of €360,000,000 in the bank.
Services
Eircom operates the largest fixed-line telecommunications network in the Republic of IrelandRepublic of Ireland
Ireland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...
, under licence from the Commission for Communications Regulation
Commission for Communications Regulation
The Commission for Communications Regulation is the general communications regulator for the Republic of Ireland, covering almost all possible types of communications....
. Most homes and businesses in the state are connected by this network. A full range of telecommunications services is provided on the network including Business IP, its MPLS
Multiprotocol Label Switching
Multiprotocol Label Switching is a mechanism in high-performance telecommunications networks that directs data from one network node to the next based on short path labels rather than long network addresses, avoiding complex lookups in a routing table. The labels identify virtual links between...
platform. Eircom have also completed a wholly owned fibre network ring around Northern Ireland and another around Belfast. Their ISP division, Eircom Net, provides dial-up services, as well as broadband services (see broadband roll-out, below). Eircom Phonewatch provides burglar-alarm
Burglar alarm
Burglar , alarms are systems designed to detect unauthorized entry into a building or area. They consist of an array of sensors, a control panel and alerting system, and interconnections...
and home monitoring services. Any alarm-monitoring products using SMS are "hardcoded" to work with Eircom's SMSC, so will not work on Digiweb, BT, Smart, UPC or Magnet phone networks. DECT SMS handsets are also preprogrammed for Eircom's SMSC. Any competing phone service that is not just carrier pre-selection (CPS) of Eircom must provide their own SMSC, but even when they do, consumers may be unable to migrate from Eircom due to SMSC numbers in equipment that cannot be reprogrammed.
Eircom's mobile arm, Meteor, provides a full range of HSPA
High Speed Packet Access
High Speed Packet Access is an amalgamation of two mobile telephony protocols, High Speed Downlink Packet Access and High Speed Uplink Packet Access , that extends and improves the performance of existing WCDMA protocols...
/(3G
3G
3G or 3rd generation mobile telecommunications is a generation of standards for mobile phones and mobile telecommunication services fulfilling the International Mobile Telecommunications-2000 specifications by the International Telecommunication Union...
) and GSM-based mobile communication services throughout the Republic of Ireland. Its GSM network operates at 1800 MHz and 900 MHz ranges, as the earlier GSM licences fully utilised the 900 MHz band. GPRS and EDGE
Enhanced Data Rates for GSM Evolution
Enhanced Data rates for GSM Evolution is a digital mobile phone technology that allows improved data transmission rates as a backward-compatible extension of GSM...
data services are also available. Meteor have recently launched HSPA
High Speed Packet Access
High Speed Packet Access is an amalgamation of two mobile telephony protocols, High Speed Downlink Packet Access and High Speed Uplink Packet Access , that extends and improves the performance of existing WCDMA protocols...
(3G
3G
3G or 3rd generation mobile telecommunications is a generation of standards for mobile phones and mobile telecommunication services fulfilling the International Mobile Telecommunications-2000 specifications by the International Telecommunication Union...
Mobile Broadband) services in Dublin, Cork, Dundalk and Drogheda. Meteor provides both bill-pay (contract) and pre-pay (non-contract) plans and has approximately 19% of the Irish mobile market, with 1,032,000 cellular subscribers on the Meteor Network. The company has used EDGE technology on its network and has received a 3G
3G
3G or 3rd generation mobile telecommunications is a generation of standards for mobile phones and mobile telecommunication services fulfilling the International Mobile Telecommunications-2000 specifications by the International Telecommunication Union...
(UMTS) licence, formerly removed from Eircom's competitor, Smart Telecom
Smart Telecom
Smart Telecom is an Irish telecom operator that started as a phone card seller. It is also the third largest provider of cost-sensitive telecom services sector in Ireland, behind the incumbent operator Eircom and BT Ireland. It currently has an estimated 50,000 land-line customers and 18,000...
(This required 33% of the population to be covered by 3G
3G
3G or 3rd generation mobile telecommunications is a generation of standards for mobile phones and mobile telecommunication services fulfilling the International Mobile Telecommunications-2000 specifications by the International Telecommunication Union...
by September 2008.)
As an operator with significant market power, Eircom is required to provide a number of wholesale products to other operators and to switch calls onto other phone networks. Many broadband products offered by other operators are resales of the Eircom product.
Eircom's PhoneWatch subsidiary provides monitored burglar alarms, fire alarms, CCTV systems, and medical alert devices.
History
The company was formed in 1984, as Bord Telecom Éireann, under the Posts and Telecommunications Act 1983. This article deals mainly with the post-privatisation Eircom. For details of the company during its time as a state-sponsored bodyState-sponsored bodies of the Republic of Ireland
A State-Sponsored Body is the name given in Ireland to a state-owned enterprise , that is to say, a commercial business which is benficially owned, either completely or majority, by the Irish Government...
, see: Telecom Éireann
Telecom Éireann
Telecom Éireann, or formally Bord Telecom Éireann - The Irish Telecommunications Board, was created by the Postal & Telecommunications Services Act, 1983 from the Department of Posts and Telegraphs, Ireland, under the leadership of the Minister for Posts & Telegraphs...
.
From 2000 to 2008, Eircom sponsored the League of Ireland
League of Ireland
The League of Ireland is the national association football league of the Republic of Ireland. Founded in 1921, as a league of eight clubs, it has expanded over time into a two-tiered league of 22 clubs. It is currently split into the League of Ireland Premier Division and the League of Ireland...
.
Privatisation
Due to EUEuropean Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
laws requiring the opening up of the Irish telecommunications market; however, Ireland had a derogation from competition until 2003. Telecom Éireann was privatised, this was very controversial and subject to much debate. The process began in 1995, and by July 1999 the government had disposed of virtually all of its shareholding. Eircom plc was then floated on the Irish Stock Exchange
Irish Stock Exchange
-History:The Irish Stock Exchange is Ireland's only stock exchange and has been in existence since 1793. It is an Irish private company limited by guarantee. It was first recognised by legislation in 1799 when the Irish Parliament passed the Stock Exchange Act...
, London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
, and New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...
on 8 July 1999 and small/first-time investors were encouraged by the Irish Government
Irish Government
The Government of Ireland is the cabinet that exercises executive authority in Ireland.-Members of the Government:Membership of the Government is regulated fundamentally by the Constitution of Ireland. The Government is headed by a prime minister called the Taoiseach...
to buy shares. The share price was set at €3.90. It later reached a high of €4.80, a 23% increase. Those initial investors who held onto their shares, until July 2000, received a 4% bonus-share allocation.
The Eircom flotation is considered to have been an example of a stock market bubble
Stock market bubble
A stock market bubble is a type of economic bubble taking place in stock markets when market participants drive stock prices above their value in relation to some system of stock valuation....
— after the initial hype of the flotation died down, the stock price fell rapidly. Many of the 500,000 small investors were angered by the significant financial loss they incurred, blaming the government for not sufficiently warning them of the risks inherent in stock-market investment.
Since privatisation Eircom penetration of landlines has fallen from 82% to 69%. During this period, there has been a large increase in mobile phone ownership and a significant rise in line rental to the highest in Europe.
Disposal of Eircell, going private and reflotation
Vodafone Ireland
Vodafone Ireland Limited, part of the Vodafone Group, is the largest mobile phone company in Ireland in terms of active subscribers, and was previously called Eircell. The mobile phone system in use is a digital GSM 900 system, and also a third-generation UMTS system...
to Vodafone
Vodafone
Vodafone Group Plc is a global telecommunications company headquartered in London, United Kingdom. It is the world's largest mobile telecommunications company measured by revenues and the world's second-largest measured by subscribers , with around 341 million proportionate subscribers as of...
. The company was transferred to a separate entity, Eircell 2000 plc which was then sold to Vodafone in a share swap. Eircom shareholders got 1 Eircell 2000 share for 1 eircom share. The conversion rate was then 0.9478 Vodafone shares for every 2 Eircell 2000 shares. This left the Eircom shareholder with not only shares in Eircom, but Vodafone also.
After the sale of Eircell, Eircom itself was believed to be undervalued and became the subject of a bidding war between two consortia: the E-Island consortium headed by Denis O'Brien
Denis O'Brien
Denis O'Brien is an Irish businessman with international connections. An Arts graduate of University College Dublin, O'Brien has received a MBA in corporate finance from Boston College in 1982, and was later given an honorary doctorate by University College Dublin.O'Brien has involvement with...
, and the Valentia Consortium headed by Tony O'Reilly, the chairman of Independent News and Media. Eventually in November 2001, the company agreed to a recommended offer of €1.335 per Eircom share. Eircom Plc was delisted from the stock exchange, become Eircom Limited, a private limited company by shares and a subsidiary of Valentia, and O'Reilly took the reins as Executive Chairman (a role he pursued with vigour, even holding management meetings at his Castlemartin
Castlemartin House and Estate
Castlemartin is the name of a historic house and estate, and the townland in which they sit, on the banks of the River Liffey in Kilcullen, County Kildare, Ireland...
home).
On 19 March 2004, the company returned to the stock market (although the company being listed, Eircom Group plc, was in fact a new holding company, and was registered in England and Wales
England and Wales
England and Wales is a jurisdiction within the United Kingdom. It consists of England and Wales, two of the four countries of the United Kingdom...
rather than the Republic of Ireland
Republic of Ireland
Ireland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...
). The company floated at €1.55 a share, but dipped on initial trading before recovering to trade above its float price.
Return to mobile – acquisition of Meteor
In early 2005, several Irish newspapers reported that Meteor Mobile Communications, the third mobile phone operator, was up for sale by its owners, Western Wireless. It was considered that this afforded Eircom an opportunity to re-enter the mobile communications market. On 9 July 2005, it was reported by The Irish TimesThe Irish Times
The Irish Times is an Irish daily broadsheet newspaper launched on 29 March 1859. The editor is Kevin O'Sullivan who succeeded Geraldine Kennedy in 2011; the deputy editor is Paul O'Neill. The Irish Times is considered to be Ireland's newspaper of record, and is published every day except Sundays...
that there had been three bidders for Meteor: Eircom, Smart Telecom
Smart Telecom
Smart Telecom is an Irish telecom operator that started as a phone card seller. It is also the third largest provider of cost-sensitive telecom services sector in Ireland, behind the incumbent operator Eircom and BT Ireland. It currently has an estimated 50,000 land-line customers and 18,000...
, and a consortium led by Denis O'Brien
Denis O'Brien
Denis O'Brien is an Irish businessman with international connections. An Arts graduate of University College Dublin, O'Brien has received a MBA in corporate finance from Boston College in 1982, and was later given an honorary doctorate by University College Dublin.O'Brien has involvement with...
. On 14 July 2005 RTÉ News
RTÉ News
RTÉ News and Current Affairs , is a major division of Raidió Teilifís Éireann responsible for news programming on television, radio and online within the Republic of Ireland. It is, by far, the largest and most popular news source in Ireland - with 77% of the Irish public regarding it as their main...
reported on their business website that Denis O'Brien had withdrawn from bidding, and that it was understood that Eircom was the top bidder at €410 million. On 21 July, it was announced that Smart Telecom had also withdrawn, leaving Eircom as the sole bidder. Eircom announced the agreement to purchase it on 25 July 2005 at a cost of €420m.
As of September 2008, Meteor (mobile) had over 1,000,000 customers and a market share of 30%, offering both GSM and 3G mobile telephony and broadband services.
eMobile (MVNO)
As part of their mobile strategy, Eircom have also launched eMobile. This is to be complementary to the Meteor division (mainly used by residential wireless customers). eMobile is a mobile virtual network operator MVNO which uses the Meteor Network for its services to residential & business customers, to compliment the residential and business mobile services offered by Meteor.Eircom Northern Ireland
Eircom NI, is the name of the company's operations in Northern Ireland. With the division based in BelfastBelfast
Belfast is the capital of and largest city in Northern Ireland. By population, it is the 14th biggest city in the United Kingdom and second biggest on the island of Ireland . It is the seat of the devolved government and legislative Northern Ireland Assembly...
, Eircom own and operate a fibre-optic network ring around Belfast and Northern Ireland, linking into the national Eircom Network in the rest of Ireland. Eircom NI have won significant contracts thus far, the largest being the €100m "Network NI" contract for the Northern Ireland Civil Service
Northern Ireland Civil Service
The Northern Ireland Civil Service is the permanent bureaucracy of Crown employees that supports the Northern Ireland Executive, the devolved government of Northern Ireland....
, with other significant contracts as operator of choice for Northern Ireland Water and Viridian
Viridian Group
Viridian Group plc is a Northern Ireland-based energy business with interests in both Northern Ireland and the Republic of Ireland. Viridian organises its business in two main groups: Power NI and Viridian Power & Energy.-Businesses:...
. The company in Northern Ireland currently provides services to local government and SME sectors.
Swisscom approach
On 2 November 2005, it was reported that the SwissSwitzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
telecommunications company, Swisscom
Swisscom
Swisscom AG is a major telecommunications provider in Switzerland. Along with Swiss Post, it is a successor company to the former state-owned PTT. Its headquarters are located at Worblaufen near Bern...
AG, had made an approach to Eircom regarding a possible takeover of the company. On 25 November 2005, the Swiss government
Swiss Federal Council
The Federal Council is the seven-member executive council which constitutes the federal government of Switzerland and serves as the Swiss collective head of state....
announced that it would use its controlling stake in Swisscom to block any foreign takeovers, effectively ending hopes of a bid.
Babcock & Brown
In May 2006 it was announced that Eircom was to be sold to the Australian investment group Babcock and BrownBabcock and Brown
Babcock & Brown was a global investment and advisory firm based in Sydney, Australia that went into liquidation in 2009. It was best known in financial markets for structured finance deals. The company had at its peak 28 offices and over 1,500 employees worldwide. Although headquartered in Sydney,...
in a deal worth €2.4 billion. The Employee Share Ownership Trust, which represents workers at the company, was to remain a minority shareholder. The sale was approved by shareholders on 26 July 2006, and at close of business on 17 August 2006, the shares were delisted from the Official Lists of the Irish Stock Exchange and the London Stock Exchange, ending Eircom's second period on the stock markets. The same day, Phillip Nolan resigned as chief executive
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
of Eircom, and on 1 September Rex Comb was officially named as the new CEO. Tony O'Reilly resigned as Chairman and was replaced by Pierre Danon
Pierre Danon
Pierre Danon is a French senior corporate executive director, presently Chairman of Ypso Holding and of Altice B2B Holding .-Education:...
, previously of BT Group plc and JP Morgan Chase.
Babcock and Brown have since collapsed as a company and their BCM vehicle, which owns over 50% of Eircom, broke all ties with the former parent and rebranded themselves as Eircom Holdings Limited.
Competition
Eircom retains a virtual monopoly, at around 70%, on fixed-line telephony in the State (the only exceptions being those operated by UPC Ireland cable company (formerly NTL IrelandNTL Ireland
NTL Communications Limited was a cable television and Multichannel Multipoint Distribution Service company in the Republic of Ireland. As of 2005 it was owned by Liberty Global Europe , having been divested by NTL...
and Chorus), Digiweb Metro and some fibre offerings from BT, Magnet Networks
Magnet Networks
Magnet Networks is an Irish company providing telephone, television and internet services via subscription over optical fibre.Magnet Networks was launched in Dublin on 1 December 2004, and is a wholly owned subsidiary of US-based international investment company Columbia Ventures Corporation...
, Smart and Digiweb). Chorus
Chorus Communications
Chorus Communications was a communications provider in Ireland, it offered internet, television and telephone services. It was owned by Liberty Global Europe, and ultimately controlled by John C. Malone's Liberty Media. It was based in Limerick, and owns the cable television and MMDS TV licences...
previously offered wireless telephony but failed to renew their licence. Eircom is required to allow carrier pre-selection (CPS). Introduced in Ireland in 2001, CPS allows subscribers to use an alternative provider for all their calls, without the need to dial indirect access codes or numbers, although they still receive a bill from Eircom for line rental. Under a wholesale line rental scheme, it is possible for customers, to have a single bill from an alternative provider, for example, BT Ireland
BT Ireland
BT Communications Limited is a telecommunications and internet company in Ireland. It is a subsidiary of BT Group plc.-Esat Telecom:The company was founded in 1990 by Denis O'Brien, and was originally known as Esat Telecom...
, including the cost of Eircom line rental, rather than continuing to receive a separate one from Eircom for this cost. Unlike the UK, where BT's competitors now can charge less than BT for line rental, it is not yet possible for operators in Ireland to buy the lines from Eircom and charge their own rate for line rental, should they wish.
Controveries with Eircom
After the privatisation of Eircom, the highly profitable mobile phone division, Eircell, was sold to Vodafone. Some consider this act to be asset strippingAsset stripping
Asset stripping involves selling the assets of a business individually at a profit. The term is generally used in a pejorative sense as such activity is not considered productive to the economy. Asset stripping is considered to be a problem in economies such as Russia or China that are making a...
by the large investors with interests in Eircom.
Eircom announced in June 2007 that from 30 July line rental charges would increase by €1.18 bringing line rental charges – already the most expensive in Europe to a total of €25.36 per month for a PSTN analogue line, one source indicated it was the highest line-rental charge in the world. Also announced was an increase of between 4.8 and 4.9% on local and national calls.
In March 2011, Eircom pleaded guilty to a breach of the Data Protection Act, at the Dublin District Court.
Broadband roll-out
As of 2nd quarter 2006, 370,000 customers had broadband, 260,000 on DSL and the others on a mix of FWA, cable and satellite. (Comreg, Q1 2006, Page 19).On 1 November 2007, Eircom announced their 500,000th DSL customer.
In terms of speed and availability, Eircom exchanges can only deliver broadband to houses within 5 km (3.1 mi) in most of its exchanges and will not be investing in fibre optic or next-generation broadband, as stated in a meeting with members of Dáil Éireann in late 2008 about broadband availability. In 2011 Eircom announced that they would invest €100 million on high speed fibre optic lines which would be delivered as a pilot scheme to customers in Dublin and Wexford.
Blocking of The Pirate Bay
On 21 April 2008 18:36, Eircom rejected claims by four major record companies that it, as the largest broadband internet service provider in the State, must bear some liability for the illegal free downloading of music by computer users. Eircom have thus far managed to come to an agreement with the companies involved, stating that they will be working in conjunction with these companies to prevent large amounts of copyrighted material being shared through the ISP. This in turn raises concerns over internet privacy, since presumably this will be done by monitoring the IP traffic associated with Eircom's customers. It is not known whether or not this bears any significance on the Meteor Mobile network, a mobile broadband supplier recently acquired by Eircom. Eircom has reportedly signed an out-of-court settlement with said companies and are initiating a program to clamp down on piracy, within their network, by instituting an IP monitoring service, accessible by the Irish Recorded Music Association (IRMA) and allowing up to three warnings before disconnection of service.Currently, Eircom users who try to access The Pirate Bay receive the following message:
- "On the 24 July 2009, an Order was made by the High Court requiring eircom to block or otherwise disable access by its subscribers to the website thePirateBay.org, its related domain names, IP addresses and URLs. The Court was satisfied that on the basis of the evidence presented by the record companies that the PirateBay website is a website that facilitates the exchange of copyrighted sound recordings without the consent of the copyright owners."
- "eircom recognises the legitimate rights of the owners of copyrighted material and believes that individuals who share or download copyrighted material without the authorisation or the permission of the copyright owner are acting illegally.
- "The Order further provides that should the PirateBay website content be legitimatised in the future, then eircom has liberty to apply to the Court to have the Order vacated and access to the PirateBay website enabled."
Since September 2009, The Pirate Bay website and trackers have remained blocked by eircom.
Disconnection
Eircom agreed to a controversial deal with the IRMAIrish Recorded Music Association
Irish Recorded Music Association is the Irish record industry association. IRMA is a non-profit association set up to manage and control the music industry in the Republic of Ireland.-Goals and activities:...
(Irish equivalent of the RIAA) to activate a "three strikes system" so it will ban users from the internet for 12 months if they appear to be downloading copyrighted content through peer to peer filesharing networks.
OneVision Irish DTT License application
On 1 May 2009 Fintan Drury, chairman of the OneVision consortium (made up of the TV3 Group, ArqivaArqiva
Arqiva is a telecommunications company which provides infrastructure and broadcast transmission facilities in the United Kingdom and Republic of Ireland. The present company, with headquarters located at Crawley Court in the village of Crawley, Hampshire, was formed by National Grid Wireless...
, Eircom and Setanta Sports
Setanta Sports
Setanta Sports is an international sports broadcaster based in Dublin, Ireland. Setanta Sports was formed in 1990 to facilitate the broadcasting of Irish sporting events...
), announced that OneVision is to enter negotiations with the BCI, with the view to takeover operations of the Irish pay DTT service. If negotiations are deemed successful, it may see the launch of DTT in late 2010/early 2011 at a proposed operation cost of €40 million. OneVision aspire to offer 23 channels coinciding with the free-to-air channels. For further information on the subject, see: One Vision (DTT)
One Vision (DTT)
OneVision was a consortium that have been offered a licence by the Broadcasting Authority of Ireland to run the pay television services on the DTT platform in the Republic of Ireland....
. Eircom is majority stakeholder in this project.
See also
- Communications in the Republic of IrelandCommunications in the Republic of IrelandTelecommunications in the Republic of Ireland, including postal services run by An Post, are regulated to a large extent by the Commission for Communications Regulation , the Minister for Communications, Energy & Natural Resources has overall responsibility for national policy and regulation...
- List of Irish companies
- Internet censorship in IrelandInternet censorship in IrelandInternet censorship in Ireland is currently a controversial issue, including a drive to censor the Internet in Ireland starting in 2008 with the introduction of a graduated response policy followed by an effort to block certain sites which started in February 2009...