Watchdog issues Eircom urgent notice to halt promotion

ComReg was concerned that the similar branding could give Eircom's retail business Eir an unfair advantage over independent competing retailers.

Eircom has been ordered to immediately halt a fibre broadband promotion offering new customers a €50 giftcard over concerns it would favour its retail arm Eir.

The telecoms firm has been issued with an 'Urgent Interim Measures' notice ordering it to cease its promotion with 'immediate effect'.

The Communications Regulator, ComReg, said the promotion was launched last Monday without their prior authorisation and was also to be geographically targeted with Eircom planning to distribute leaflets to 77,464 eircodes. Eircom is viewed as a telecoms operator with Significant Market Power (SMP), and its promotions may not favour Eircom's own retail arm over other access seekers. The promotion was run by Open eir, the company's wholesale arm, and ComReg was concerned that the similar branding could give Eircom's retail business an unfair advantage over independent competing retailers.

Contacted last week by ComReg, Eircom's Chief Regulatory Officer confirmed the promotion but said they did not believe the incentive required notification. However, ComReg moved swiftly to impose the urgent measures after concluding that the promotion would likely have been rejected on anti-competitive grounds anyway.

In their decision, ComReg said: "This is a breach that risks creating serious economic or operational problems for other providers of electronic communications networks and service."

The promotion consisted of a €50 Gift Card (JustEat, Boots or whoopee) to those end-users for whom a connection is activated on the Open Eir network. The Gift Card can be claimed on Open Eir’s website when a connection is live.

ComReg’s primary concern centred on the promotion’s structure and reach. The €50 gift card offer was geographically targeted at approximately 77,000 specific premises in so-called “low penetration areas.”

Geographically specific discounts are strictly prohibited because they are designed to “discourage efficient investment by rival operators and reduce competition over time.” By heavily incentivising customers in areas where competitors are trying to build their own presence, Eircom—the dominant player—can undermine the financial viability of its rivals.

ComReg also raised governance concerns, noting that the gift card could be claimed directly from the wholesale entity, Open eir, regardless of the retail partner used. This structure, coupled with branding similarities, raised fears that it could potentially favour Eircom's own retail arm over other competing retailers.

As a result of the investigation, Eircom was ordered to deactivate the registration link, stop the distribution of leaflets and ensure all wholesale partners and agents immediately cease advertising the offer. "Eircom has been told to stop registrations for the Promotion on its website, stop delivery of any related leaflets and other marketing activities in connection with the Promotion, and ensure that all its agents and partners stop promoting it," the notice states.

In its decision, ComReg said there was nothing to stop those users who registered for the promotion before it was taken down from receiving the €50 gift card.

A spokesperson for Eir said the company was in the process of complying with the notice and will engage with ComReg in line with the procedures outlined in the notice.

Open eir is Ireland’s largest wholesale telecommunications provider and has invested €1.7bn in recent years, rolling out fibre broadband to homes and businesses. In June, the company said it had surpassed 1.4 million homes and businesses with its fibre-to-the-home (FTTH) broadband network.