The average annual phone bill will fall by as much as £120 a year because of liberalisation of the telecoms market, the Minister for Public Enterprise, Ms O'Rourke, said last night. Meanwhile, Ocean, the British Telecom/ESB consortium, yesterday unveiled its own new package, which it claimed would offer cheaper tariffs for residential customers making national and international calls.
It follows a new package from Esat Telecom, which says its service is 10-15 per cent cheaper than that from Telecom Eireann.
Speaking at a function in Dublin Castle last night to mark Deregulation Day, Eireann in all market sectors - Ms O'Rourke said the real winners from liberalisation will be consumers, who now have choice.
She said that she expected prices to fall by up to 20 per cent in the first year and by 5-10 per cent the following year. "Average annual bills will be down by as much as £150 by the end of 2000 and obviously significantly more for heavier users."
The Minister said these were the practical effects of competition, but it would also result in major investment in the telecommunications sector. This investment would run at £500 million per annum over the next three years, she predicted.
Explaining why she had pressed for Telecom Eireann's derogation on switched voice telephony to be abandoned 13 months ahead of schedule, she said it would have been "sheer folly" not to open the market now. Earlier, Ocean had unveiled its new deal for consumers, both business and residential. It is offering Ocean Link, aimed at small business and residential customers.
The customer can install a small box (or auto-dialler) to the existing phone line. It costs £20, but this will be credited to the customer if he/she makes £150 worth of calls in the first six months.
Ocean's chief executive, Mr George McGrath, said it would enable customers to save on international and national calls, plus calls to mobiles by connecting to the Ocean network.
He told The Irish Times that customers who make a lot of national and international calls were being targeted by Ocean. He said the company would not compete with Telecom Eireann on local calls, as the incumbent would always be cheaper.
However, he said Ocean was cheaper "across the range" of national and international calls, especially for calls to the US and UK. Like Esat's proposition, the calls will be charged by the second, rather than the unit, and he said, it was a clear pricing tariff.
Last night Telecom Eireann's chief executive, Mr Alfie Kane, said the company would further reduce prices by £130 million next year, and possibly by as much as £200 million.
