To the uninitiated, Internet users must sound ungrateful when they begrudge the cost of a local call to send email and access Web pages all around the world. Their wishes for flat-rate access - calling their Internet service provider (ISP) for as long as they like for a fixed charge - may sound like the demands of spoilt children, but they will get their way sooner or later.
The positions of the various parties on this contentious issue are, on the surface, simple: the Government wants flat-rate access but Telecom Eireann is resisting; the Internet Service Providers (ISPs) are wary because it will require extra resources, but they welcome any move which will make the Internet more popular. Meanwhile, the punters - talk about preaching to the converted - would love to stay online without the meter running.
The Minister for Public Enterprise, Ms O'Rourke, is anxious to push for flat-rate access as part of the drive to develop Ireland as a centre for e-commerce. This is one half of a two-pronged drive to promote Internet usage and develop broadband infrastructure. She feels it is hard to position Ireland as an e-commerce hub when there is a perception that access rates are too high.
Ms O'Rourke had hoped that Telecom Eireann would announce flat-rate access during President Clinton's recent visit, but if she's waiting for Telecom Eireann to oblige, so far she has been stood up. Telecom Eireann denies it is under any pressure, pointing out that it already reduced local-call charges to ISPs last July.
But a spokesman for Telecom Eireann says it is looking at possibilities to make Internet access cheaper, and that nothing is ruled out. "The company agrees with the Minister's drive to make Ireland an e-commerce capital," he says, adding that it is not overly concerned about the revenue loss on these specific calls as it too wants to promote Internet usage. This makes sense when you recall that Telecom Eireann owns two of the big three ISPs serving the domestic market.
So if it's not the revenue, why won't Telecom Eireann bite the bullet on calls to ISPs? Well, nobody wants to talk about it publicly, but the real reason seems to be fear of the European Commission's Directorate General on Competition (DGIV). Sources both within and outside Telecom Eireann, question whether DGIV would approve flat-rate access for local calls to ISPs while local voice calls are charged by time.
Telecom Eireann has already tested the waters, increasing the time of a single unit from three minutes to five minutes for calls to ISPs, but it is treading warily because like many European telecom companies, local voice calls are a significant source of its revenue. Europe hasn't adopted the US model, whereby local calls within a limited area are free, paid for by line rental and long-distance calls.
However, an authoritative EC source close to the Directorate said he did not think DGIV or the EC could force a telecom company to implement a particular call rate. He said even if Telecom Eireann had flat-rate pricing for calls to ISPs, there would be "a totally different rationale for the pricing of local [voice] calls". "They are two different scenarios," he concluded.
They are even more different now that Telecom Eireann has moved the ISP access numbers over to special 1891 codes. Arguably they are not local calls anymore.
So much for the telecom company, what about the ISPs themselves? Well, in the main, they support flat-rate access, figuring that anything that's good for the Internet is good for them.
Ireland On-Line's head of operations, Mr Garfield Connelly, says: "Flat rates bring us a lot closer to the Internet paradigms in the United States," but notes that America On-Line (AOL) has had to write to customers who are connecting at 7 a.m. and staying online but inactive all day.
Mr Connolly says IOL has no problem with people staying online if they are using the service, but would consider using software to disconnect calls where there has been no traffic for a long time. This, he says, is already done to save people who forget to disconnect from huge phone bills.
Although ISPs would have to invest in additional equipment if we all stayed online longer, the advantages to e-commerce are easy to see. Mr Connolly says, for example, sending email for a pizza delivery would become viable. If you know your local pizzeria is permanently online, you will be prepared to send email for pizza. However, if the pizzeria is only collecting its email once an hour, there's no point in emailing orders.
"Email is pretty well instantaneous," he says, "but it is only instantaneous if you're connected." He says people are not exploiting websites because they're aware of the clock ticking.
The other ISPs welcome anything which promotes Internet usage while noting that they'll need extra resources. One, however, is worried that flat-rate access will cut off a potential revenue stream. Mr Tom Kelly, head of the largest privately held ISP, Club Internet, feels that part of the revenue from calls to ISPs should go to the ISPs themselves, which is already happening in Britain where EasyNet has an interconnect agreement with BT. There are hopes that this will happen following deregulation, but he is worried that if Telecom Eireann gave cheaper access to customers, it would be even less inclined to share the call revenue with the ISPs.
If Telecom Eireann wants to remain the primary channel through which users connect to the Internet, it will have to quickly roll out new telephony-based technologies such as digital subscriber line (DSL). Modems and telephone lines already look slow and cumbersome, as cable, MMDS, digital terrestrial TV and even satellite offer fast, continuous online access. Soon even flat-rate calls won't be enough to keep users connecting via the telephone company, but they would be a start.
Eoin Licken is at elicken@irish- times.ie
