Watchdog hits out at Eircom 3pc price hike
Published 01/06/2010 | 05:00
TELECOMS firm Eircom faced criticism last night after it admitted it has introduced pricing changes that will lead to a 3pc hike in fixed-line customer phone bills.
The company will introduce 'call rounding' from July 1 for customers on bundled packages.
This means customers will be rounded up to the nearest minute of the call's duration and not to the nearest second, as is now the case.
The new charging arrangement will only apply to calls made that fall outside the bundled package. Yesterday the firm said around 500,000 of its 1.1 million customers would be affected, but it claimed not all would be hit with the increases.
But the Consumers' Association of Ireland (CAI) said the changes were unsatisfactory in a climate of falling inflation, which dropped 2.1pc in April.
"I don't think this is acceptable," said CAI chairman Michael Kilcoyne. "It comes at a time when inflation is continuing to fall. Someone should tell Eircom to tighten its belt -- everyone else is being told to do so."
Eircom confirmed that customers on bundled services who make calls outside their terms and conditions will be hit with the increase.
Other changes include new flat rates for calls from fixed line phones to O2, Vodafone and Meteor mobiles; while the company is also cutting the call set-up fee for small business customers to 4.8c ex VAT.
Eircom is facing increased competition from mobile and cable firms which are eating into the firm's profits and revenues.
Last week, Eircom reported a 7pc drop in revenue at €455m for the three months ended March. The company is also saddled with €4bn in debt, and 1,200 staff are expected to leave the firm under a voluntary redundancy programme.
Nearly 900 people have already signed up for the deal.
"A significant portion of our customer base will be unaffected by today's changes and those half a million on bundled packages will continue to get good value," said Stephen Beynon, Eircom group managing director.