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Government Propose New Principles for Easier Telecoms Switching

Thursday, October 22nd, 2015 (8:15 am) - Score 434

The Government has today called for consumers to give their feedback on a new set of “Switching Principles“, which among other things proposes that you should able to switch your electricity, gas, bank accounts, telephones, broadband and or TV providers both “quickly” and “without charge“.

Eagle eyed consumers will no doubt be aware that Ofcom recently harmonised the process of switching broadband and phone providers around a single Gaining Provider Led (GPL) solution, which we have already explained in a lot of detail (here).

The regulators solution was an improvement, although it had some limitations. For example, the system only works on BTOpenreach’s national UK telecoms network and KC’s (KCOM) similar platform in Hull (East Yorkshire). On top of that it still struggles to cope with quad-play bundles where Pay TV and Mobile services may also be involved.

One other annoyance is that the switching process can still attract all sorts of cancellation charges. The Government appears to be mindful of this and so they’ve today set out a batch of new Switching Principles for the entire industry to follow and are calling for consumers to give their feedback.

The Switching Principles

* Switching should be free to the consumer unless they are aware of and have consented to reasonable restrictions and charges to do so.

* The switching process itself should be quick, at an agreed date.

* The switching process should be led by the organisation with most interest in making the switching process work effectively – the gaining provider.

* Consumers should have access to their consumption or transaction data. This should be in a format that can be easily reused (e.g. Midata) and they should be able to authorise third parties such as comparison sites to access their data to help them to switch.

* Sites and tools providing comparisons to consumers that receive payments from suppliers should make clear where this affects the presentation of results.

* There should be an effective process for consumers to get redress if anything goes wrong in the switching process.

Admittedly there are some conflicting messages here, such as with calls for switching to be “free“, but only unless you happen to be aware of and have consented to “reasonable restrictions and charges“. The last part could be a problem because far too many ISPs continue to bury some of their fees and charges in the small print and thus consumers often overlook them.

Nick Boles, Business Minister, said:

By setting out clear principles for switching suppliers, this government will make it simpler and easier for consumers to shop around for the best deals.

All too often families miss out on hundreds of pounds of potential savings because they think it will be too complicated or take too long to switch.

Consumers have a key role to play in driving firms to be more competitive so we also want to hear from them and industry on how businesses can be more responsive to customers.”

The new principles are being fuelled by similar changes to EU rules. Meanwhile Ofcom are already considering various enhancements, not least in respect to the problem of improving the migration process for those with quad-play bundles (e.g. Ofcom’s mobile switching proposals).

A related Call for Evidence page has been setup where consumers can share their experiences with the current switching processes.

Leave a Comment
3 Responses
  1. Avatar Steve Jones says:

    It’s all very well saying switching should be free (in whatever market), but that can introduce huge distortions where there are real costs involved to the supplier. The problem is those costs have to be picked up somewhere. The suspicion is that it’s the poor “loyal” customer who doesn’t want to spend his/her time checking comparison sites all the time who ends up picking up the bill for all these transactional costs.

    Perhaps the “gaining” supplier ought to pick up all these external transactional costs along with maximum contract periods (perhaps 12 months) and that might stop some of these unsustainable packages which morph into expensive long term ones.

  2. Avatar dragoneast says:

    I suspect an unspoken reason why Governments (of all persuasions) are so hung up on switching is because it’s cheap way of generating economic activity (and jobs) without any real underlying productivity or technological innovation. Politicians are lazy. As usual they conveniently forget about the rest of the population who aren’t in enthusiastic pursuit of change for changes sake. As long as it produces a marketing advertisement and a good headline, nothing else matters.

    1. Avatar dragoneast says:

      PS As, ironically, a former ISPs mag editorial put it on the threshold of the present century: “In the modern world change has become the substitute for progress”. I can’t put it better.

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