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Fixed line and texts are here to stay, insists a defiant Eircom

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Fat cheques have been handed over to departing Eircom executives

Fat cheques have been handed over to departing Eircom executives

Fat cheques have been handed over to departing Eircom executives

Eircom is committed to fixed-line phones and sees "no end in sight" to the service, the company has said, despite having taken a legal challenge to rules that force it to provide the product around the country.

"Clearly consumer habits are changing rapidly but 95pc of our customers have a fixed- line phone and the pattern is not changing," its consumer division's managing director Jon Florsheim added.

"We know that for many customers, this is their only means of communication".

His commitment to providing fixed-line services comes less than a year after Eircom took a legal challenge against the communications regulator over its designation as a Universal Service Provider, which forces it to provide telephone poles and cabling to rural parts of the country at a capped price.

It has argued that the obligation is unfairly expensive and should also be part-funded by its competitors, since they can use the lines.

The growth of internet communication methods is not diminishing fixed-line demand either, Mr Florsheim said.

This week the company unveiled a price hike aimed at compensating for the cost of spending on internet services.

Demand for online connectivity has shot up in recent years, and this week online messaging service Whatsapp overtook the traditional text message by volume for the first time.

A price hike of as much as €100 will be levied on customers with bundles, which are packages that combine broadband, TV and phone services.

The company cannot guarantee that there will be no more price hikes over the next two years, Mr Florsheim said.

It is gearing up to pitch "aggressively" for state contracts to supply rural households with fibre broadband, Mr Florsheim added. It expects a tender invitation to be issued by the Government before the end of this year.

The bulk of what's left in Eircom's infrastructure spending budget has been set aside for these contracts.

It has spent €1bn on fibre broadband and 4G infrastructure in the last three years but has another €500m left to spend by the middle of 2016.

The contracts are part of government plans to improve rural connectivity by part-funding industry to bring fibre broadband to remote areas. It is not feasible to build connections to many rural locations unless the Government covers some of the costs, Mr Florsheim added.

"The more the Government puts in, the better. It does not make economic sense for us to do this without government support".

But it is not yet clear how much of the cost will be covered by the State and how much by private companies, he added,"and we are anxious to find out".

Sunday Independent