# Smart Telecom - Eircom Dispute -- Who is to blame?



## hmmm (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

Another miserable failure by Comreg. Firstly they should have forced through phone number portability rather than allowing Eircom to stall the process thereby stifling Smart, and any sensible regulator would have ensured that in the event of a regulated telecom failing (any telecom) that provision would be made to prevent customers having their service interrupted.


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## HelloJed (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

Well said Hmmm! I hope you don't mind, I've incorporated your comments into a complaint to ComReg. I doubt they'll listen though, but I'm so frustrated with their favourable treatment to Eircom that I had to do something.

Excellent article:
[broken link removed]

I'm sure I'll be cut off soon but I refuse to switch providers until I absolutely have to. I'm sure some of the blame lies with Smart's business practices, but the Eircom/ComReg love-in definitely has something to do with it.


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## paddyc (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

Its only wholesale customers with eircom that are affected, smart customers using smart equip in the exchanges are not affected.

Can't just blame Comreg, Smart business model was doomed to failure - they couldn't possibly afford to keep taking the hit on 100,000 customers not paying line rental. My guess is the mentality of Smarts directors was they were hoping to be bought out by some big multinational or american company with money to burn before they got into this much trouble. 

I wonder how much money Smart wasted trying to take RTE to court for not getting the weather forcast sponsorship when they must have known they were already in financial difficulty!


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## monkeyboy (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

This is more than a debt situation, this puts Eircom in a very strong negotiating position re the 3g licence....they have Smart over a barrel and one over the regulator should Smart win the 3g licence!


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## kramer2006 (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

Some further information on Smart's level of debt with Eircom:

http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1698794&issue_id=14717


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## bazermc (3 Oct 2006)

*Re: Has Smart Telecom gone down?*



kramer2006 said:


> Some further information on Smart's level of debt with Eircom:
> 
> http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1698794&issue_id=14717


 

Eircoms new owners Babcock & Brown are taking this debt of €4m a lot more seriously then the previous managment in Eircom.  It is quite likely that Smart will not survive till the end of the year, be warned.


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## Humpback (3 Oct 2006)

*Re: Has Smart Telecom gone down?*



HelloJed said:


> but the Eircom/ComReg love-in definitely has something to do with it.


 


			
				dieter1 said:
			
		

> My outgoing and ingoing were working this morning at 8am. I completely agree with the above poster. The blame ultimately lies with Comreg


 
Can HelloJed and dieter1 please explain how ComReg is responsible for the problems with Smart Telecom?

And please don't start mentioning the blocking of local loops and all that. Smart Telecom at the moment have access to circa 600,000 home residential customers I believe, for both telephone and broadband packages.

Out of that potential customer base, they've signed up something like 40,000 phone customers and 17,000 broadband customers. This is 6% and 2% of their potential customers.

They've spent an absolute fortune on advertising, yet still haven't managed to penetrate their potential market any more than that. Having a bigger available customer base (had Eircom been more accommodating) wouldn't therefore mean they'd have been any more successful in attracting customers.

Does anyone actually know what the *ISAF Nations Cup* is that was sponsored by Smart?

Smart didn't spend their money wisely, bottom line. They hired over-paid former Eircom executives that Eircom doesn't even want back (I wonder how good they actually were in the first place then) and they spent a fortune hiring a door-to-door sales team which defies logic given the kind of product they were selling. The also sold something they were paying Eircom money for (line rental) to their own customers for nothing - not a very sound business policy. And they overextended themselves on their marketing expenses.

I can't see any of this being the fault of ComReg, or even Eircom at that.

Poor management!


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## monkeyboy (3 Oct 2006)

*Re: Has Smart Telecom gone down?*



bazermc said:


> Eircoms new owners Babcock & Brown are taking this debt of €4m a lot more seriously then the previous managment in Eircom. It is quite likely that Smart will not survive till the end of the year, be warned.


 
4m of debt for line rental on their own lines is but pocket money, sure its not even a real debt to Eircom as its only on rental of tehir lines, somehting easily struck off as bad debt in a bigger pic. 

There is a much bigger picture here in that Smart may end up with something eircom want and Eircom currently have Smart by the Goolies commercially

Will be well worth watching this one over the next while.


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## Humpback (3 Oct 2006)

*Re: Has Smart Telecom gone down?*



monkeyboy said:


> There is a much bigger picture here in that Smart may end up with something eircom want and Eircom currently have Smart by the Goolies commercially


 
Quite possibly, but it's unlikely that Smart Telecom are going to get that 3G licence. At the time, their Finance Director (I think) as good as admitted that the bonds, allegedly provided through a Chinese company, that they said they had weren't all they were cracked up to be because technically they were guaranteed by Smart rather than the Chinese, therefore breaking the terms of the ComReg contract for the licence.

Additionally, the Chinese company who was allegedly providing the these bond guarantees are now manufacturing own-brand Vodafone 3G phones which are to be lodged soon on the Irish market, so it's unlikely that Vodafone will be all that keen to see what relationship with Smart continue.


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## monkeyboy (3 Oct 2006)

*Re: Has Smart Telecom gone down?*



ronan_d_john said:


> Additionally, the Chinese company who was allegedly providing the these bond guarantees are now manufacturing own-brand Vodafone 3G phones which are to be lodged soon on the Irish market, so it's unlikely that Vodafone will be all that keen to see what relationship with Smart continue.


 
Dont follow this part??? What is the VF connection ?


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## Humpback (3 Oct 2006)

Huawei Technologies was the company that was allegedly partnering with Smart Telecom for their 3G licence application.

However, in the last couple of weeks, Vodafone have announced that the same Huawei Technologies is manufacturing their new Vodafone branded 3G phone.


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## monkeyboy (3 Oct 2006)

Yeah Huawei were to be supplying the kit for the network to Smart.

Now they have managed to get the foot in here through VF you say.


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## Fintan (3 Oct 2006)

*Re: Has Smart Telecom gone down?*



ronan_d_john said:


> Can HelloJed and dieter1 please explain how ComReg is responsible for the problems with Smart Telecom?
> 
> And please don't start mentioning the blocking of local loops and all that. Smart Telecom at the moment have access to circa 600,000 home residential customers I believe, for both telephone and broadband packages.




Hi Ronan 

Have you actually tried to change phone supplier to Smart telecom? 

I live in a Smart enabled exchange. I tried to switch to Smart and found out I would to complete the followings steps. 

Cancel by BT connection and move back to Eircom. Possible length of time 1 to 2 weeks
Once I have my Eircom account, I then had to give Smart my Eircom account number and they then apply to move me to Smart telecom. Again length of time is 1 to 2 weeks all going well. 

So a minimum of 4 weeks without broadband / telephone is not something I could live with. 

Just to note I wasn't rying to keep an existing telephone number, I just wanted a smart telephone / broadband package. 

So yes I would say ComReg need to shoulder some blame for allowing such a system to exist. 

From talking to friends and family, I was not unique. I had one friend wait 15 weeks to get moved across to Smart. 

 Cheers
Fintan


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## Guest124 (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

Whatever about sticking it out with Smart you would hardly go back to Eircom after that poor treatment and why three days wait? - Total Joke!


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## extopia (3 Oct 2006)

*Re: Has Smart Telecom gone down?*

I'm no eircom fan, but you can't blame them for pulling the plug if they suspect they are not going to get paid, surely? I don't like the fact that they own the "local loop" either, but they do, and they are running a business.

Mind you, if they wanted to win back these Smart customers they might have given 24 hours notice or something...


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## gearoid (4 Oct 2006)

*Re: Has Smart Telecom gone down?*



extopia said:


> I'm no eircom fan, but you can't blame them for pulling the plug if they suspect they are not going to get paid, surely? I don't like the fact that they own the "local loop" either, but they do, and they are running a business.



The speed at which Eircom disconnected Smart customers contrasts enormously with how long it takes them to connect customers to other operators in the first place. I had to wait seven weeks to get connected to Digiweb as Eircom dragged their feet connecting me in the hope I'd get fed up and stay with Eircom. I must admit I despise Eircom's tactics, and I'm shocked how much leeway they have been given by the regulators for this obviously anti-competitive jape... If they can disconnect the 10,000 in a day then it shouldn't take them weeks to connect customers to other suppliers. The Government sold us into a monopoly situation in '98 and we've been living with the consequences ever since. I'm not a Smart customer but I hope they survive and prosper...


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## HelloJed (4 Oct 2006)

I had to wait a month to be connected to Smart. It's understandible that a company like Eircom would put their own customers first.

Which brings me to why I'm so annoyed with Comreg. Why have Eircom been allowed to keep the lines? Line rental is very expensive here - more expensive than in any country I've lived in. And to expect Eircom to treat Smart telecom customers the same as Eircom customers for service is a joke. No-one is making them, and no-one is changing the weird system here. So why should they treat them the same?


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## CCOVICH (4 Oct 2006)

HelloJed said:


> Why have Eircom been allowed to keep the lines?


 
I have been wondering this myself-where the (monopoly?) provider of the lines is also a carrier, it is surely a 'dangerous' situation?

Of course Eircom could just argue that anyone can invest in building their own network, the same way that Eircom 'invested' to build the existing network.

Am I missing something?  I don't really see the need for the State to have retained ownership of a carrier-but maybe they should have retained the network?


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## MugsGame (4 Oct 2006)

> but maybe they should have retained the network?



Rubbish -- can you imagine if the transport networks were nationalised and we didn't have all the competing private toll roads and rail lines!


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## CCOVICH (4 Oct 2006)

MugsGame said:


> Rubbish -- can you imagine if the transport networks were nationalised and we didn't have all the competing private toll roads and rail lines!


 

???


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## HelloJed (4 Oct 2006)

The current situation is like it's nationalised - but instead of the lines being owned by the government, they are owned by a company that will always put their own profits first. 

IMHO, until the lines situation is sorted out, we'll never have proper telecoms competition here in Ireland. We'll certainly never see a reduction in the line rental cost. Why should Eircom lower the line rental charge? They own all the lines - there's no reason why they should.


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## CCOVICH (4 Oct 2006)

HelloJed said:


> The current situation is like it's nationalised - but instead of the lines being owned by the government, they are owned by a company that will always put their own profits first.


 
Well every company has the right to make a 'fair profit'-and should seek to maximise same as much as regulation allows.

The problem I have is that the supplier of lines is competing for business with carriers-and given their monopoly on the provision of lines, there exists too much temptation to make life difficult for other carriers.

Btw, I don't really care whether ownership of lines is State owned or private, but everyone should have the right to a line, something that may be better executed by a State owned company.


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## HelloJed (4 Oct 2006)

Sorry, should have made myself clearer in my previous post. I certainly don't expect that companies should do anything than seeking fair profit, and I completely understand why Eircom would make it more difficult for other providers. They are a company, full stop.

Which makes the whole situation so ridiculous - one company in charge of all of the lines in Ireland - it's not good news for consumers.


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## CCOVICH (4 Oct 2006)

HelloJed said:


> Which makes the whole situation so ridiculous - one company in charge of all of the lines in Ireland - it's not good news for consumers.


 
But other than the laying of separate networks/new lines (as SMART tried to do), there isn't really a way around that, is there?


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## Sunny (4 Oct 2006)

The state of the telecommunications industry in this country is a perfect example of the mess that be made by incompetent government. You have a private company controlling all the lines in the state (built with taxpayers money). You have a regulator that despite been given a months notice by Eircom that there were problems with Smart and were going to take this action, decides to bury their heads and hope their problems go away. Broadband in this country is a expensive and the coverage area is a national disgrace. I was in France recently. Free calls, unlimited broadband and 30 tv stations for 25 Euro a month. 

Having said all that Smart are in trouble because they have a poor business model. They haven't been helped by Eircom but again that is something for the regulator to sort out.


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## Humpback (4 Oct 2006)

Sunny said:


> You have a regulator that despite been given a months notice by Eircom that there were problems with Smart and were going to take this action, decides to bury their heads and hope their problems go away.


 
What is it that the regulator could have done here? They regulate, not interfere in day to day business operations? You want them to make up the rules as they go along?


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## Sunny (4 Oct 2006)

ronan_d_john said:


> What is it that the regulator could have done here? They regulate, not interfere in day to day business operations? You want them to make up the rules as they go along?


 
No, but surely if they know that a company that they supposedly regulate is in financial difficulty and that 40,000 people are about the lose their services, they can intervene and try to broker some deal to ensure that consumers don't lose out. They did it quickly enough once Eircom pulled the plug. Did they think Eircom were bluffing or something when they said they would do it.


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## Humpback (4 Oct 2006)

Sunny said:


> No, but surely if they know that a company that they supposedly regulate is in financial difficulty and that 40,000 people are about the lose their services, they can intervene and try to broker some deal to ensure that consumers don't lose out.


 
You mean interfere in normal business practices? That's hardly the right thing to do?



Sunny said:


> They did it quickly enough once Eircom pulled the plug.


 
Only because the Government forced them to. And I don't agree with that either.



Sunny said:


> Did they think Eircom were bluffing or something when they said they would do it.


 
No, I don't thing they thought eircom were bluffing. They were, however, carrying on like a lot of Irish companies (except on a larger scale) by withholding payments for services received for as long as possible seeing if they can get away with it.


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## SirOurs (4 Oct 2006)

CCOVICH said:


> But other than the laying of separate networks/new lines (as SMART tried to do), there isn't really a way around that, is there?


 
Why not, they have a monopoly and it's plain to everyone that they are exploiting this with the highest fixed rental costs in Europe.

The regulator is supposed to provide a level playing field for all companies in the market. Why is it unrealistic to think Com Reg could force Eircom to unbundle. 
Proper targets should be set for Eircom to unbundle and they should be fined if they don't meet them.

I'm a Smart customer and have had another look around at other providers in the light of recent problems and I'm facing an increase of at least 15-20 Euro a month for a lesser service.


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## Sunny (4 Oct 2006)

ronan_d_john said:


> You mean interfere in normal business practices? That's hardly the right thing to do?


 
It is not normal business for one company to owe another nearly 4m in arrears and have it service cut off in a so called regulated industry. One of the major arguments for the regulation of crucial industries is the prevention of a market failure that will effect a large number of people. Do comreg not have any powers to *try *and prevent this from happening. If not, why not?


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## Humpback (4 Oct 2006)

Sunny said:


> It is not normal business for one company to owe another nearly 4m in arrears


 
The arrears were €1.5m, not €4m. 

And are you telling me that there are no businesses anywhere that have debts i.e. creditors of €4m, or to be more correct €2.5m?

And as I've already said, it's common practice for many Irish businesses to build up debts by not paying their creditors for as long as possible. You only have to see, on a more minor scale, the number of business people on this site who have problems with non-payment of debts for services provided.

I would say that this is very normal business.




Sunny said:


> One of the major arguments for the regulation of crucial industries is the prevention of a market failure that will effect a large number of people.


 
Firstly, I don't accept that telephony is a "crucial industry" as you state.

But more importantly, can you please explain how the telephony market failed as you say?

To my mind, Smart Telecom has failed, the market has not. Smart Telecom has failed because of a poor business model as I have explained above, in extreme detail.

You cannot have a regulator stepping in because of a poorly run company - that's insane.


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## Decani (4 Oct 2006)

Is it possible for the govt to CPO back the infrastructure and let them all (Eircom, EsatBT, UTV etc.) have an equal playing field? As long as Eircom own the copper they have the advantage. Smart's difficulties are just a symptom of a bigger problem.


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## Humpback (4 Oct 2006)

Decani said:


> Is it possible for the govt to CPO back the infrastructure and let them all (Eircom, EsatBT, UTV etc.) have an equal playing field? As long as Eircom own the copper they have the advantage. Smart's difficulties are just a symptom of a bigger problem.



This could be possible, but more in the medium to longer term. 

If the new owners, as is expected, split the company into two operating vehicles managing the network on one side, and the retail on the other, then it would be a much easier proposition for the network side to be purchased back by the government.

Letting Babcock and Brown go through the hardship of making this split would make sense. The government could then swoop in and buy the network side at market rates (not via CPO which is a land purchase vehicle only afaik).

I was about to say that this was all possible, but not likely. However, if the government does buy back the West Link Toll Bridge, then a precedent would be set.


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## nlgbbbblth (4 Oct 2006)

Around two years ago we decided to go with Smart for our telephone calls.

Disaster.

Repeated incorrect billing, 
a refusal to refund, 
a promise to refund which never materialised, 
hopeless, useless, robotic, lying customer support
eventually paid them off
automated demand letters signed with a facsimile signature kept coming etc etc

We went back to Eircom in the end who, for all their faults, were a zillion times better.

While I feel sympathy for their customers I feel that they are entirely to blame for the mess they are in.


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## Guest127 (4 Oct 2006)

dont quite think the word swoop comes to mind when it comes to government decisions


. The government could then swoop in and buy the network side at market rates


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## CCOVICH (5 Oct 2006)

Does anyone know why Eircom wasn't split into networks and carrier service at the time of the IPO?

Anything to do with unions, who, if I have heard/read/understood correctly, were objecting to B&B buying Eircom for the reason (among others) they would split the business in this way?


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## Decani (5 Oct 2006)

CCOVICH said:


> Does anyone know why Eircom wasn't split into networks and carrier service at the time of the IPO?


Probably a cultural thing. Most of us grew up in the P&T generation and there was no division between the infrastructure and the services that can be run on that infrastructure. All people did back then was make phone calls (or even dial-up connections). Now that you can have broadband with one company and phone calls with another one, it makes more sense to divide the network from the services.

Regarding, problems with Smart billing services, you can bet that people will have had similar experiences with other companies. I used to have broadband and telephony with EsatBT up till about 1.5 years ago. I switched to NTL for broadband. EsatBT still charged me for broadband 4 months after it was disconnected. Only an email to Bill Murphy sorted that mess out. Then I jumped on the VOIP wagon and had the phone line disconnected. That was about 1.5 years ago. Then, last week, EsatBT sent me a letter saying that because I'd changed my billing preferences to paper (as opposed to online) they were going to start charging me €2.50. I haven't had a phone line for over 1.5 years!!

So you can bet that people have differing experiences with other service providers and you'll probably find a few threads here on AAM to illustrate that.

But to get back on topic, it's unfortunate that this issue getting shadowed by Bertiegate and Aer Lingus/Ryanair. It would have been nice to have this debated and discussed more. Everybody could win if the govt. took back the copper and everyone competed on a level ground.


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## nlgbbbblth (5 Oct 2006)

Decani said:


> Regarding, problems with Smart billing services, you can bet that people will have had similar experiences with other companies. I used to have broadband and telephony with EsatBT up till about 1.5 years ago. I switched to NTL for broadband. EsatBT still charged me for broadband 4 months after it was disconnected. Only an email to Bill Murphy sorted that mess out. .


 
I too had problems with Esat BT and like you had to resort to emailing Bill Murphy to sort them out. Which he did.

At the end of my Smart experience I couldn't even get a human to talk to. Utterly useless.


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## ClubMan (5 Oct 2006)

I have used the _BT _sales contact form three times to ask about transferring to them from _UTV _but they haven't bothered to get back to me. I think I'll try elsewhere...


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