Wednesday 26 June 2019

Key urban markets set to become new battleground

Outgoing CEO Richard Moat. Photo: Marc O'Sullivan
Outgoing CEO Richard Moat. Photo: Marc O'Sullivan

Analysis: Donal O'Donovan

New owner Xavier Niel's camp is understood to see an opportunity for Eir in challenging Virgin Media by bringing fibre to the home in key city markets including Dublin. That's potentially good news for consumers, but if that's at the expense of the rural infrastructure rollout favoured by outgoing CEO Richard Moat it's going to be a big headache for the Government.

Policy makers, especially Communications Minister Denis Naughten, are going to have to get the measure of Eir's new owners fast. No other private company in the State is as important as Eir. That's because, unlike Bord Gáis, Eir held onto its vast infrastructure of cables and switches when it was privatised. No alternative provider has emerged with anything like the same scale or reach. The digital age means if anything we've become more reliant on Eir.

Its sale inevitably raises concerns, all the more so when it has already been bought, sold and bought again so many times that Judge Peter Kelly described its history as "a game of corporate pass the parcel", where players in the game won and the "parcel lost".

That was in 2012. Since then two more sets of owners, a first led by Blackstone and more recently a group led by Anchorage Capital, have held the reins. Both have overseen significant investment, especially in fibre broadband, but there's no guarantee those priorities won't shift.

The good news is that Xavier Niel knows the sector. He owns telecoms firms in France, Switzerland and Monaco. Noises from the Niel camp are that he's in for the long haul, but that's a sentiment that was shared by almost all previous Eir owners too, at least at first.

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