Eircom is on the brink of collapse warns union boss
EIRCOM workers union have voiced their fears that the Irish company could face collapse within six months, putting 5,500 jobs in jeopardy.
The Communications Workers Union (CWU) has claimed there is a "real possibility" that the communications company could undergo a major restructuring, affecting the thousands of jobs based here.
General Secretary Stevie Fitzpatrick said the "perilous" financial situation of the company as well as the loss of customers posed a threat to the future of the company.
"This once great company is now on the brink of collapse and the silence from Government and the Regulator, both of whom can play a part in rescuing the company, is both deafening and extremely worrying," said Mr Fitzpatrick at the union's biennial conference.
The union said the Government needed to take Eircom's future seriously and "support the company, or else it will be facing another very costly collapse". The Employee Share Ownership Plan (Esop) owns 35pc of the company.
However, Eircom refuted the claims and said in a statement it was "confident" that it could resolve its cost issues.
"Eircom is making very significant strides for the future," it said. "In recent months, we have stabilised our ownership structure, and secured in ST Telemedia a strategic partner for the future."
The statement said Eircom had eliminated its pension deficit and reduced its operating costs by €130m, or 17pc, since the 2007-2008 fiscal year.
Separately, STT, the Singapore-based owner of Eircom, has set up an international advisory body to help manage its investment here.
The body hasn't met yet and is expected to have at least half a dozen members, including Brendan Tuohy, a former secretary general of the Department of Communications.
Earlier this week, UPC hiked up the pressure on Eircom in the broadband market.
The organisation announced a 100Mbits/sec product and by mobile operators upgrading their infrastructure.
The company said that later this year it would launch a 100Mbits/sec broadband product expected to be priced at around €80-90 per month, in line with its other European offerings.
Eircom has rolled out a next-generation network that has raised its entry-level broadband speeds to 8Mbits/sec, but going faster than its top-end 24Mbits/sec product would require significant investment in its DSL-based infrastructure that it is not in a position to undertake.