NTL will ask the telecoms regulator to sanction a price increase for its cable television service before the end of the year, its new chief executive said yesterday.

Mr Brian Moore, who was installed as head of NTL's Irish operation in February, said the price increase would take account of inflation and capital costs.

He gave no details on the timing or scale of the proposed increase but indicated that he thought NTL's current tariffs were cheap.

NTL charges £9.12 (#11.58) per month for its basic package of 15 television channels. A sports package costs an extra £16.99 while a movies package costs an additional £11.

NTL has not increased its prices for three years and decided against requesting an increase last year because of Government concerns over inflation, according to Mr Moore.

"We went along with this [government's] request but with inflation last year at 7 per cent our margins are being eroded."

NTL is raising prices across its franchise operations in the UK which will see the monthly charge for its digital service ultimately increase to £14.99 sterling from £10 sterling.

But under the terms of its cable licence NTL must make a formal request to the telecoms regulator and gain approval before it can raise prices in the Republic.

It remains uncertain whether telecoms regulator, Ms Etain Doyle, would sanction such a rise.

An attempt by rival cable firm Chorus to introduce a £2.50 per month fee to provide maintenance and service provision to customers has been resisted by Ms Doyle.

NTL's proposed price increases may coincide with the launch of its digital television service in September.

This service will be delivered over its existing network following its decision to halt the rollout of a new broadband network earlier this year.

Mr Moore confirmed that the group would launch its digital television platform by September to some 115,000 customers in Dublin and all its customers in Waterford and Galway.

This service will offer consumers up to 75 digital television channels. It will not have interactivity until the firm continues upgrading its network next year.

The first phase of this upgrade will enable NTL to offer some customers cable modems which can provide the Internet at speeds of up to 512 KPS. This product would be rolled out to meet demand, said Mr Moore.

A second phase of NTL's upgrade will enable the firm to offer telephony services using voice over Internet Protocol technology. This should be available by 2004.

Following a technology review the company has decided to use a technology platform known as the Docsis standard.

This standard requires just one set-top box to provide digital television, broadband Internet and telephony. The alternative Davic standard, which the firm had originally considered deploying, uses three set top boxes, said Mr Moore.

This could save the firm and customers up to £500 per box deployed, he added.

Contrary to many other technology firms which are cutting staff NTL is recruiting, said Mr Moore.