Saturday 27 December 2014

Cutback or a mistake? Either way you pay

Published 08/08/2014 | 02:30

The huge price rise is being imposed because a government subsidy designed to ensure basic broadband is available in isolated parts of the country is to be stopped
The huge price rise is being imposed because a government subsidy designed to ensure basic broadband is available in isolated parts of the country is to be stopped

There are two possible interpretations of the current rural broadband price hike: a cutback or a screw-up.

Of the two, the cutback theory is the kinder to the Government. It spent €80m subsidising broadband micro-networks in rural blackspots for a fixed time period. Now that that period is up, it has chosen to leave those areas to market forces, regardless of the extra cost to some 45,000 households.

The screw-up theory is less kind. This suggests that the Government simply forgot this deadline was approaching and has been caught unaware by it. In other words, it has no plan rather than a cutback plan.

Either way, a lot of people are now going to be hit with considerably higher bills for what is, increasingly, a basic utility in modern life. That this comes in the wake of Ireland's telecoms regulator reaffirmed that national law mandated universal access to telephone services, no matter where you live, is a little ironic.

While 3 Ireland cannot be too harshly judged for the price hikes, its supporting arguments for the diminution in services are a little cheeky. The company that consistently positions itself as the champion of "all you can eat" broadband is slashing the monthly data allowance for these cornered rural customers (with a €5 per gigabyte penalty for those who exceed the new lower limit). Anyone who wants the same level of data as before is now directed to a much more expensive tariff. In an era of growing Netflix and streaming use, thousands will see little choice but to do this.

To be fair, none of 3 Ireland's pricing is extortionate by the measure of rival operators. But it is still a little sad to see it resort to relatively low monthly data caps. Hopefully, it isn't a sign of things to come in its post-O2 acquisition mode.

It is also unfortunate that the taxpayer may have funded a broadband network and a customer base for one operator to now do what it likes with. To be fair to 3 Ireland, it says it does not make money out of customers in the national broadband scheme but the situation remains unsatisfactory.

Irish Independent

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