Mary Harney
Question:51 Miss Harney asked the Minister for Transport, Energy and Communications the plans, if any, he has for the future of the telecommunications industry.[3752/95]
Written Answers - Telecommunications Industry.
The Government recognises the need for high quality and cost effective telecommunications services to support essential economic and social development. It is committed to the provision of a full range of services which are competitive with those available elsewhere in the European Union.
Competition is already a fact of life in the provision of services in significant parts of the telecommunications market, with the exception of telecommunications infrastructure and voice telephony; as specifically defined. Even voice telephony which is still an exclusive privilege of most telecom organisations is coming under competitive pressure. Further competition is inevitable as a consequence of developments in EU policy and law, technology and the market itself.
I believe that the policies of the European Union in relation to the liberalisation of the telecommunications sector represent the best way forward to achieve our goals for the sector. Liberalisation of telecommunications is a world wide phenomenon whereby State owned monopoly provision of telecommunications services is being replaced by competitive regimes with substantial and, in many cases, exclusive private sector participation. This has resulted in the rapid expansion of services and lower tariffs; Ireland cannot afford to be in the slow lane of world telecommunications in terms of standard and price.
I am in the process of putting in place a regulatory regime appropriate to a competitive market. The two major steps which remain to be taken in relation to liberalisation in Ireland are liberalisation of telecommunications infrastructure and voice telephony services for which a deadline of 1 January, 1998 has been set for the EU generally but Ireland may avail of a derogation of up to five years. The question of whether it is in our overall economic interest to trigger this derogation at all or in full has yet to be determined but will be addressed in the coming months.
However, I recognise that it would be irresponsible to adopt radical liberalisation measures in Ireland at a time when Telecom Éireann is not in a position to compete with new market entrants.
It is a challenge for the Government as shareholder and for the board of the company to take the measures necessary to ensure that Telecom Éireann is in a position to capitalise on the emerging opportunities and face competition with confidence. Telecom Éireann has served the State well over the last ten years in terms of updating the national telephone network to modern standards.
However, the need for Telecom Éireann to improve its cost base, tariff structure and range of services is clearly evident in order to position the company for increased competition in an open market. As part of this preparation, Telecom is now in the process of reviewing its long term strategy and examining the need for an alliance with an external partner in the context of its future development. There is close contact with my officials concerning this.
In the context of the strategy to improve the competitive position of Telecom Éireann I will consider the appropriate timing of liberalisation of telecommunications infrastructure and voice telephony services in Ireland. Liberalisation will also necessitate the establishment of a regulatory office for telecommunications to regulate the competitive market and the development of a policy to share the social obligations currently carried by Telecom Éireann, notably universal service. These matters are being considered by my Department at present.