British Telecom is to invest a further £600 million (€761 million) in Esat Telecom over three years in an attempt to double turnover and help it become the top telecoms provider in the Republic within five years.
The investment will be split between the business, residential and wireless branches but there will be added focus on Internet and wireless. It will lead to the creation of some 300 jobs. Mr Neil Parkinson, chief executive officer at Esat Telecom, said the company had set a target of achieving a 45 per cent share of the total Irish marketplace which he said would be worth £2.3 billion by 2005.
The company currently has a combined turnover of about £300 million and is predicting profitability by 2003. Mr Parkinson said Esat Digifone and "various elements of the Internet business" had already achieved profitability.
He said the company would not seek to challenge Eircom's dominance in the residential fixed line market, but would aim to be the second-placed telecoms operator in this sector.
He said Esat currently had 82,000 customers or 7 per cent of this market. In terms of pricing, Esat would not aim to be the cheapest for residential customers but would seek to provide value for money, he said. However, he claimed calls made on the Esat network were more than 50-100 per cent cheaper than 70 per cent of the rates offered by NTL.
Mr Parkinson was speaking at the launch of the company's corporate rebranding and restructuring following British Telecom's acquisition of Esat Telecom in April.
The result of this review means Esat Telecom is to be split into three business units in a similar format to British Telecom. Esat Business will include all of the services in voice, data, Internet and network management available to the corporate market; Esat Digifone will continue to operate the mobile phone business; and Esat Fusion brings together a number of phone and Internet services offered to the residential market and plans to "fuse" these services with new multimedia offerings.
Esat has decided to drop almost all the Ocean brands, despite the multi-million pound marketing and advertising campaigns since its launch. However, Esat will retain Ocean's Internet service provider - Oceanfree.net - to target younger users while IOL.ie will focus on the more mature market.
Asked what effect the resignation of Esat's chairman, Mr Denis O'Brien and four company directors, had had on the company, Mr Parkinson said there were young managers ready to drive the company.
He said the company had suffered a staff attrition rate of between 15-20 per cent during the merger process with Ocean which was equivalent to the industry norm.
Mr Parkinson claimed the company now had 82,000 residential customers, 138,000 Internet customers and more than 800,000 mobile customers.
