Is the eircom dream finally over?

The dream that once was eircom was that a 75-year-old semi-state company could be transformed into the major national broadband provider through the combination of union/worker ownership and private capital. That dream now seems to be well and truly dead. What put the nail in the coffin in the last week or so is that eircom’s cable competitor, UPC, ┬áis now offering 12 Mbps speeds as its entry-level broadband service. This means that UPC’s cheapest broadband package is faster than eircom’s most expensive.

This is bad, but it isn’t necessarily fatal. Eircom can come out of this, but it will require some big steps.

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The crisis at eircom

A union leader recently told the papers that eircom could be on the brink of collapse within six months. Obviously the union has suddenly become aware that there is a large amount of debt overhanging the company.

The fact that eircom has a lot of debt is well known. The actual structure of that debt is less well known. The role of the unions in running up the debt is not talked about much at all. However, these are all key to understanding what will happen next at eircom.

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