Business Opinion/John McManus: This morning lawyers for Eircom are due on their feet in the High Court. They will be seeking the reversal of a decision by the Commission for Communications Regulation (ComReg) to force Eircom to cut the price at which it allows other phone companies use its local network.
The case will probably be adjourned for two weeks but it is a very important milestone in Eircom's relations with the State and Irish society in general.
If Eircom is successful there will be very significant consequences for the Government's rather belated attempts to encourage the take-up of high-speed connections to the internet - or broadband, to use the jargon.
While today's court case is not directly about broadband, the company has been very quick to link its outcome to more than €1 billion worth of investment that will be integral to the introduction of widespread cheap internet access and the general standard of the Republic's telecommunications infrastructure.
What Eircom appears to be saying is: "If you make us cut out prices, then you can kiss goodbye to broadband".
It is pretty serious stuff. The consensus about the need for urgent action on broadband ranges across the entire spectrum of sectoral interests. There is general acceptance that slow roll-out of broadband and higher prices for telecoms services is hurting inward investment.
The issue gets a paragraph of its own in the current social partnership agreement, Sustaining Progress.
As part of the agreement with trade unions, the Government has given a specific commitment to roll out "the necessary infrastructure identified in its Broadband Action Plan".
The issue has also been flagged by the National Competitiveness Council (NCC).
In its report last November, the NCC said that special priority should be given to deploying broadband infrastructure throughout the State.
According to Mr Martin Cronin of Forfás, who sits on the NCC: "Ireland has fallen behind at the start of that \ race. We can't let that gap widen."
The NCC is a creature of the partnership process, having been spawned by the 1997 agreement. It is made up of representatives from the social partners, including the trade unions.
Its current membership include Ms Joan Carmichael, the deputy general secretary of the Irish Congress of Trade Unions (ICTU), as well as Mr Des Geraghty, president of SIPTU.
It is hard to believe then that the single biggest shareholder in Eircom is, in effect, the Communication Workers Union - one of the State's best-organised unions, a member of ICTU and presumably a fully signed-up supporter of the current partnership.
Technically speaking, the CWU is only one of a number of unions at Eircom but its near total control of the Eircom Share Ownership Trust (ESOT) - which has a 29.9 per cent economic interest in the company and 25 per cent of the voting rights - is plain to see. Not least in the trinity of roles held by Mr Con Scanlon as general secretary of the CWU, deputy chairman of Eircom and chairman of the ESOT.
One can only assume that Eircom's decision to effectively hold the State to ransom over broadband and further investment in infrastructure can only have been made with the backing of its largest shareholder.
Equally, one can only assume that the CWU/ESOT has decided to put its members' pockets ahead of the broader national interest as identified by ComReg, the NCC and Sustaining Progress.
This in turn says something about what a busted flush social partnership is - but that is another day's work.
The CWU, of course, may choose to hide behind the fig leaf that it is opposed to local loop unbundling - the technical term used for providing competitors with access to Eircom's local infrastructure.
Mr Scanlon made it clear several years ago that he felt unfettered unbundling would be anti-competitive and would act as a marked disincentive to investment.
By taking this rather dubious stance, the CWU may be able to stay on board with Eircom management's attempts to blackmail the Government, but it pits them against a range of other commentators and organisations.
Amongst them is Prof Bill Melody, a former chief economist with the US Federal Communications Commission, who was brought in as an independent arbitrator by ComReg.
"This is a battle which decides whether the next step in telecoms liberalisation goes forward or its stalled.
"Simply resisting all this change isn't helping Ireland or Eircom," according to Prof Melody.
The reality is - as the regulator has made clear - that Eircom can cut the price at which it gives others access to its local loop and also fund further investment.
In order to do so, the company has to become more efficient.
That, of course, is a euphemism for shedding jobs and getting more work out the remaining employees.
And that is a course of action that very few unions ever support.
They would far rather support a court case which, in the words of Prof Melody, is contrary to the national interest, never mind the national wage agreement or the spirit of social partnership.
