A new report on Internet access charges and services should benefit consumers but promises to further stir up the highly unpredictable Internet market in the State.
The report, published yesterday by the Telecommunications Regulator, Ms Etain Doyle, paves the way for a range of new access offerings, "from zero rated call charges to zero rated subscription charges", she said in a statement. According to Ms Doyle, she is attempting to guarantee that costs for Internet access are kept low by encouraging competition between the various network operators and access providers. Following a query to her office by Telecom Eireann last November, Ms Doyle has approved flat rate access - a flat charge that would allow Internet users a set number of hours of Net access or unlimited access. Operators also could opt not to charge consumers at all for phone calls to access the Internet, but would presumably need to recoup costs through subscription fees, online advertising or e-commerce ventures.
The report also allows any Internet Service Provider (ISP) or network operator offer special access numbers such as the 1891 number Telecom Eireann makes available to consumers via their ISPs, which lowers daytime calls for Net access by 30 per cent. In a shift that Telecom's competitors have welcomed, the regulator has stipulated that the price paid by the consumer for such calls should be determined not by Telecom, but by the operators in whose networks such calls terminate.
Telecom should only retain revenue to cover the actual costs of carrying the call on its networks. Finally, she indicated the need to establish similar guidelines for data networks - the high speed networks to be used mostly by business rather than consumers - and invited comment from interested parties.
Telecom Eireann said it welcomed the report. "There's good clarity," said a spokesman. "We have a much more transparent regime." However, the company has indicated that it will not immediately press forward with plans to implement a flat rate service, which was to have offered 100 hours of Internet access monthly for £20.
"We're going to be reviewing flat rate in terms of what has been happening in the industry," said a Telecom spokeswoman. She indicated that Telecom believes customers may prefer to "pay as they go".
One source with an Internet-related business said this would be a mistake. "The flat rate is important from every perspective," he said, but noted that any charge for calls will continue to impede the Internet's growth in Europe.
Other network providers were quick to welcome the report. Its principles "are all those things we've been looking for", said Ocean's business development manager Mr Derek Kickham. However, he said the report only provides principles: "What they have not done is set the prices."
The report states that operators need to meet in October to agree costs and services. The most contentious element is likely to be deciding Telecom's basic cost of letting a call use its networks.
According to Mr Barry Flanagan, co-founder and former managing director of ISP Ireland On-Line, the report "looks good. It should help open the market", he said. He believes ISPs will now begin to offer a range of packages for Internet access targeting different types of user. But he said ISPs must move towards generating revenue from online advertising and e-commerce, not Internet subscriptions.
However, any significant expansion of Irish Internet use is still contingent on free local calls to access an ISP, he said. "The biggest barrier is still the call cost."
