Ofcom Set to Unveil New UK Phone and Broadband ISP Switching Solution

It’s been a long time coming but the UK communications regulator, Ofcom, has informed ISPreview.co.uk that their chosen method for making it both “simpler and more reliable” for consumers to switch phone or broadband ISP is finally close to being announced. No really, this time it’ll actually happen. We hope.

At present ISPs tend to adopt different solutions for tackling migrations, which usually depends upon their choice of platform (BT-based, cable or LLU unbundled etc.) and your product type (broadband, superfast broadband, phone or bundled). The outcome is a confusing approach to migration that can also result in loopholes where switching providers might cause downtime or incur some unexpected costs.

Suffice to say that solving this technically complex problem and simplifying it through a new system, which must also be designed to prevent abuse (e.g. slamming and mis-selling), has not been an easy task. The fact that it’s now taken two and a half years to reach this stage is testament to the difficulty of being able to overcome these issues and reach an agreement that ISPs can stomach.

An Ofcom Spokesperson told ISPreview.co.uk:

“Having considered all responses to last year’s consultation in great detail alongside new evidence in what is a highly complex area, we are currently completing work on our policy decision statement which is due to be published this summer [2013].”

As to the solution itself. Ofcom originally proposed three methods (here) but they’re known to favour a Gaining Provider-Led (GPL) process that would put most of the power into the hands of your new provider instead of the old one. As a comparison the current M.A.C process requires your old provider to issue a special code first and this doesn’t always work as intended (especially if your ISP goes kaput!).

However a GPL solution is likely to require some form of controversial Third Party Verification, which would work to protect consumers from abuse (e.g. being switched to another ISP without your consent). One problem with this is that such a solution would probably carry an additional cost, which ISPs may or may not seek to recover from consumers.

But even if Ofcom does publish its final proposal this summer (we’ll remain sceptical until it actually happens) then it would still require one last consultation and thus the new solution isn’t likely to surface until sometime next year. In other words.. about 3-4 years since the whole process first began (here).

Separately Ofcom has also informed ISPreview.co.uk that its on-going review of the UK’s Wholesale Broadband Access market might result in changes to how it currently defines specific telecoms markets for regulation and price controls (current system). At present the regulator classifies different parts of the country based upon the amount of competition from ISPs in any given area (i.e. Market 1, Market 2 and Market 3).

Market 3 areas are typically home to four or more ISPs and thus have the lowest prices due to de-regulation, while Market 1 is essentially the opposite and services are usually only available from BT (e.g. the last 11.7% of premises in predominantly rural areas). Some ISPs, such as PlusNet, can charge customers significantly more if they live within Market 1 areas because they cost more to serve.

An Ofcom Spokesperson told ISPreview.co.uk:

“Ofcom carries out periodic reviews of the UK’s telecoms markets. These reviews ensure that our regulatory framework keeps pace with changes in the sector over time.

Last November we kicked off new reviews of the market for wholesale broadband access, as well as the wholesale market for services from the local exchange to the end user. We expect to outline our detailed proposals in these areas later in the summer, and conclude the reviews next year. Separately, we expect later this year to conclude our current review of the retail and wholesale markets for voice calls in the UK.”

Any change is likely to account for the spread of TalkTalk and Sky Broadband’s LLU network, which means that many Market 1 areas could become Market 2 or 3 and thus support cheaper services. However it remains to be seen whether Ofcom would merely adjust the definition, scrap it completely or perhaps leave the whole thing unchanged (the latter seems unlikely).