Kennedy announced he was stepping down from the Columbia Ventures-backed operator two weeks ago to pursue his own business interests in the US, but in a parting shot he slated the make-up of the Irish telecoms market.

"I'm not defeated, but I won't deny it's a very challenging market for everyone, " said Kennedy, who established Broadview Networks in New York before merging with CVC.

He criticised telecoms regulator Comreg as a major factor in difficulties in the Irish market, as well as incumbent operator Eircom.

"I'm more critical of Comreg than I am of Eircom.

[Eircom is] a monopoly and if I was them I would get up every day thinking 'how am I going to remain a monopoly?', which is what they do. It's up to the regulator to grab them by the throat which is not impossible if there's a will, " he said.

Sources close to Magnet said there had been some disagreement between Kennedy and other executives on what kind of long-run strategy the operator should pursue, but this was denied by Kennedy and Magnet finance director Mark Kellett, who replaces Kennedy in the top job.

Kellett was previously chief executive of Irish cable TV operation Channel 6, and formerly European finance director for Yahoo.

"Magnet is still at the embryonic stage, still getting used to convergence, " said Kellett, who added he will pursue the expansion plans revealed in February, when Magnet announced it was increasing capital expenditure by 25m beyond the 45m already earmarked for expanding its household triple play services and small business offerings.

Kellett has also expressed interest in using the transatlantic fibre connection owned by Magnet's sister company, Hibernia Atlantic, to offer highgrade services to corporate customers, and has said he is mulling a move for Magnet into Northern Ireland.

In the North, Hibernia has already been linked with plans to develop a new transatlantic fibre link from north Antrim to Nova Scotia.