Clix, Sonaecom’s internet access service, has announced the suspension of their wide band ADSL service to new clients, following a similar earlier decision taken by Capital Media’s IOL service. The cancellation of the service was not a surprise as it had been hinted for some time by Sonaecom’s president, Paulo Azevedo.
Azevedo has long commented on the difficulty of making ADSL workable because of the allegedly excessive prices that Portugal Telecom charge Clix for broadband network rental. He confirmed the cancellation of the ASDL offer on Portuguese TV in a move that is expected to lead Anacom, the sector’s regulator, to bring pressure to bear on PT to lower its prices.
The joint decisions by Sonaecom and IOL come at a time when Anacom had already announced that effective telecommunications competition, especially with regard to high band internet access, is one of its main objectives for the period 2004 to 2006. Abel Mateus, President of the Competition Authority, has also commented that the Portuguese telecommunications sector still suffers from a lack of effective competition, noting that, in certain areas, communication costs in Portugal are around 30 to 40 per cent higher than in other European countries.
However, Portugal Telecom has refused to take the blame, stating that Clix was losing money on its ADSL service because it didn’t have enough customers. “This business is only profitable if the company has sufficient client numbers. Clix only has 10,000 clients, while there are currently 150,000 clients using our ADSL service,” said a spokesman from Portugal Telecom.