Eircom needs to be split into two parts and a separate network division created if broadband penetration in the Republic is to catch up with that of other developed countries, according to a new Labour party discussion paper.
Labour sees Eircom's stance on unbundling the local loop - opening a key part of its network to competitors - as a substantial barrier to broadband access. Labour's spokesman on communications, Tommy Broughan, said yesterday that a break-up of the firm's operations would mean the "endless blockages" in broadband delivery would be addressed.
Eircom, for its part, argues that physical local-loop unbundling is not the main reason for the State's broadband deficit. The company says the Republic suffers from a lack of competing networks for broadband delivery.
Labour proposes reaching a "settlement" with Eircom that would allow consumers to access more broadband products at lower prices. Mr Broughan acknowledged, however, that Eircom would be unlikely to agree to Labour's plan without argument. He said ComReg, the communications regulator, should have the power to "insist" on such a move.
ComReg has already said it will not rule out taking steps to force Eircom to open a key part of its network to its competitors.
Eircom has outlined proposals to allow its competitors to access connections between its exchanges and individual consumers and businesses but ComReg has described these as "disappointing".
Labour also wants ComReg to be able to levy heavier fines on companies that do not comply with its rulings. These fines could reach 10 per cent of company turnover, Mr Broughan suggested.
He pointed to a study by the Organisation for Economic Co-operation and Development, which placed the Republic 19th out of 22 developed countries for broadband take-up. The Republic has, according to Mr Broughan, "slipped out of the Premiership" in the area.
He said the Government needs to establish a new broadcasting and communications department to reflect the importance of the broadband issue. The sector currently falls under the Department of Communications, Marine and Natural Resources.
Labour also wants the Government to create a universal service obligation for broadband, similar to the system that already exists for telephony and postal services.
