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Price Controls for WBA in Ireland

Case commented on the Irish Commission for Communications Regulation’s (ComReg) proposals for new price controls of eircom’s Wholesale Bitstream Access (WBA) products.  ComReg Consultation 10/56 (July 2010) proposes that the current retail-minus approach be replaced with rate of return based maximum and minimum prices for eircom’s WBA products, together with LRIAC-plus approach to control for possible margin squeeze abuses.  ComReg’s approach seeks balance several conflicting considerations (anti-competitive foreclosure, consumer protection, optimal investment incentives) by reducing WBA wholesale and retail prices while at the same preventing those prices from being ‘too low’ that they deter the take-up of and investment in LLU line share access.  Case critically but briefly assessed ComReg’s approach and analysis.

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