# How are the new phone companies cheaper than eircom



## evoke (7 May 2005)

I was just wondering how the new phone companies like tele2 and the others are chaper than eircom. It would like to change over to tele2 but it just sounds like there lioke too good to be true.

I rang them yesterday and they quoted 3.42 cent during the weekday local against 4.92 cent at eircom. I can not remember what the quote was for the weekend local i do not think it was that much better than eircom.

Is there any hidden charges that they catch you out with. Has anybody got any experience with them or any other new phone company. Just want to lower the cost of my phone bill.

Thanks for any help


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## ClubMan (7 May 2005)

UTV charge nothing at all for local, national and _UK _off-peak calls and there is no catch. I don't know how they do this. Perhaps they are loss leaders for other services or something?


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## Lemurz (9 May 2005)

Most Other Licenced Operators (OLOs) purchase their calls from Eircom at wholesale rates which enables them to undercut Eircom (on a very tight margin).

Some of the newer opertors are using "voice over IP" (voip) or the internet to carry calls (i.e. Telestunt) which is the direction telecoms is heading.

Most of the bundled packages on offer are based on a certain usage level.  If this is exceeded, the packages will be modified.  For example, Euphony offered unlimited local & national calls for €10, but recently removed ISPs from the package because they were being fleeced by online customers.


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## extopia (9 May 2005)

I use Tele2. There are no hidden costs (at least none I've noticed.) They can charge less because they have a lower cost base than fat and happy eircom, who have been bleeding us dry for years with their "cash cow" fixed line business.

Don't forget you still have to pay the line rental to eircom, which will probably cost more than your calls.


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## podgerodge (9 May 2005)

Eircom is beginning to fight back - it's latest Talktime offer covers unlimited Peak and Off peak national/local calls and line rental for Eur39.99 a month - eur15 for unlimited calls.  Better than the old? Esat offering of Eur25 a month for the calls plus the 25 line rental.

UTV still on top though unless you are using a lot of peak calls.


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## Unregistered (10 May 2005)

I suppose some a piggybacking on eircom's wholesale rate and making small profits on each customer but are try to extend their base also some like NTL might be trying to extend their customer base before selling off to make a huge profit.


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## gailey (11 May 2005)

I changed over to smart telecom. They also take over line rental from eircom and I have noticed a significant change in my bill. Also if you call someone else who is also with smart telecom the call is free. There are no hidden charges. Telecom have being ripping us off for years, so it is great to see a bit of competition.


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## RainyDay (11 May 2005)

Unregistered said:
			
		

> I suppose some a piggybacking on eircom's wholesale rate and making small profits on each customer but are try to extend their base also some like NTL might be trying to extend their customer base before selling off to make a huge profit.


Just for the record, NTL is being sold at approx half the price for which it was purchased in 1999. Doesn't seem like a 'huge profit' to me!


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## Observer (11 May 2005)

RainyDay said:
			
		

> Just for the record, NTL is being sold at approx half the price for which it was purchased in 1999. Doesn't seem like a 'huge profit' to me!


 
And there you have it - the answer to the original question.  The new companies are selling at a loss to gain market share.  The dotcom mania school of ecomonics.  Companies valued at multiples of their customer number rather than profit.  Bit like a pyramid scheme with everyone hoping not to be the last one holding the baby.  Remember, Denis O'Brien (entrepreneurial poster boy of our times) never made a penny profit in the Telecoms business.  Not one penny.  Yet he sold ESAT (a hugely lossmaking company) to BT (bigger fools) for $2.x billion - it's worth a fraction of that today.  THAT'S how you make money, not by offering a sustainable profitable service.


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## Unregistered (11 May 2005)

Hmm. So you don't think eircom have always been a little overpriced then? Do you WANT to pay for that kind of bloated management structure on your phone bill. 

Hell, while we're at it, let's all pay throught the nose for air travel while we're at it and keep plenty of people at work.


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## BlueSpud (13 May 2005)

I cant help but think of the workforce in places like Eircom, where the unions worked so hard to keep people in well paid jobs where they did not have to work too hard.  When we talk of fat cash cows, and ineffecient operations, we are not only talking about management, but the front line staff as well.  It must be hard to find the right balance between a large effecient business, and a decent level of service.  The service from a lot of the new telecoms boys on the block is very bad, (I waited 45 minutes on an 1890 number for UTV support yesterday), but ironically, from the cash cow of the sector, I got the bluntest, unyeilding level of service  & incompetence I ever encountered when getting broadband last year when trying to set up a business to a deadline.  For that, I will never forgive them, and immediatly moved my home & business accounts to the competition.  Just what do all of these people do in Eircom?  I am very happy with the choice, it's the old Ryanair/Air Lingus thing.  The slim operations will do a job, but can drop you in the mire, and if you are prepared to pay, you have the choice.  Ya pay yar money & take yar chances.


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## extopia (13 May 2005)

Well said Bluespud. I had the pleasure of running a couple of eircom salesmen from my doorstep a week or two ago. The old arrogance is still there with those guys. Eircom are still trying to sell me broadband even though I've had it since the day it became available.


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## Unregistered (13 May 2005)

The 'catch' with these companies only appears when you hit a technical problem.
My neighbour is an Eircom Engineer & has first hand told me that he often gets call outs to fix tech problems with peoples fixed phone lines.
He pull up in his van, check the signal arriving to the comms box OUTSIDE the house & more often than not finds that the signal is good.

It's when he goes inside & the establishs that the consumer is not an Eircom customer is when the fun starts.
Now the problem is for the Tele2 or whomever to sort out - NOT Eircom. Its usually a glitch over in the exhange but these cheaper providers do not have the service engineer support that Eircom do so you'll be waiting for it to be fixed.

So know you have to use your mobile (& pay Vodafone or whomever at rip-off rates) to work throught the problem with your cheaper fixed line provider!!


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## tax payer (13 May 2005)

*banana republic*

donyt know about that
most hold the eircom equipment rental so are still an eircom customer
I believe that Eircom must provide a line to an inside point

This overpaid engineer with 1/4 milion euros in shares in his pocket and another 1/4 million + yet to come is peddling the Eircom line.(+ redundancy and an indexed linked civil service pension)

Of course Eircom can't compete with this type of scenario where the employees call the shots and the customers are considered last.

Its a disgrace that Eircom cannot compete properly with these new operators
and out the customer first.

The banana republic lives on


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## Unregistered (13 May 2005)

*Re: banana republic*



			
				tax payer said:
			
		

> donyt know about that
> most hold the eircom equipment rental so are still an eircom customer
> I believe that Eircom must provide a line to an inside point



& this is why you pay your line rental to eircom - its when you can't make a call is when the fine print in the contract you signed kicks in when you changed provider.

Eircom provide the line ) Tele2 (or whomeever) provide the operating service. If line is good but service not operational - Eircom tell you to ring your provider.

Remember this the next time you get a Telesales pitch at 8pm in the evening. Ask about service engineer & how they interact with eircom when the problem isn't line related!

BTW I ain't defending Eircom & how it operates & sgree with you comments. Merely pointing out the catch to anyone thinking of changing.


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## Observer (13 May 2005)

Unregistered said:
			
		

> Hmm. So you don't think eircom have always been a little overpriced then? Do you WANT to pay for that kind of bloated management structure on your phone bill.


 
Answers:  YES and NO respectively.  But that still doesn't invalidate my original point that the prices charged by most of the new kids on the block are unsustainable in the long term and the object of the exercise is simply to build up market share at any cost and get out quickly.  Just like Denis did!


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