The notion that 50,000 households and businesses could be without a phone for up to 10 days is anathema to our view of ourselves as a wealthy modern state. But that is the reality facing customers of Smart Telecom and it speaks volumes about the failings of the Government's telecommunications policy.
First and foremost Smart's difficulties represent a business failure. But it was a venture that should have succeeded and the roll-call of names that put their money behind it reads like a who's who of Irish commercial life. They are hard-headed business people who would not be expected to be easily parted from their cash.
Put simply Smart promised more than it could deliver. Initially it had no problem signing up customers for its well marketed products, but it could not achieve the scale needed to make the business work at the prices it was charging and it ran into trouble. The company was quick to blame Eircom for its woes and it instigated legal proceedings, accusing the former State telecoms company of abusing a dominant position. It claimed that Eircom used various tactics to frustrate its plans which require the use of Eircom's network. Eircom, for its part, expressed doubts about Smart's creditworthiness and other issues. But its behaviour towards Smart fits with a wider pattern aimed at disrupting and delaying the opening up of its network to competitors as required by law.
Eircom has engaged in trench warfare for a number of years with ComReg, the State agency charged with regulating the market. ComReg has come off second best for the most part and its lack of muscle has been regularly exposed. Its failure to open up Eircom's network has seen alternative telecoms providers exit the stage or scale back their plans. Without a doubt the lack of progress in this area compounded the other issues faced by Smart and contributed to its problems.
Sight should not be lost of the fact that Eircom's decision to switch off Smart and effectively take out a competitor comes only months after the company was bought by an Australian bank for €2.36 billion. Most of the money is borrowed and must now be repaid. It is clear that Eircom's new owners are even more committed to ruthlessly protecting their iron grip on the market than were their predecessors.
The responsibility for opening up the telecoms market and fostering competition rests with the Minister for Communications who cannot simply pass the buck to ComReg. It is well past time that the Government ensured the regulator has the teeth, competence and appetite to force Eircom to come to heel.