Memorandum submitted by Consumer Communications
1. The Advisory Committees on Telecommunications
1.1 Consumer Communications for England (CCE)
and the other five advisory committees ("ACTs") were
established by the Telecommunications Act 1984 to advise the Director
General of Telecommunications on matters within his remit which
they wish to draw to his attention or matters he refers to them.
The committees seek to represent the interests and concerns of
consumers, and try to ensure an emphasis on the needs of those
with least power in the marketthose on low incomes or in
rural areas, small businesses, the disabled and elderly (see Annex
1 for further details of the ACTs).
1.2 Committee activities encompass conducting
occasional research, running conferences with other consumer organisations,
seeking views on telecoms issues from other consumer organisations,
monitoring the findings of OFTEL's own consumer and market research
programme, receiving reports on trends in consumer complaints
dealt with by OFTEL. The Advisory Committees maintain an independent
web site providing information about their membership and work,
copies of annual reports and plans, responses to government and
OFTEL consultations, details of meetings, links to other relevant
sites, information on how to pursue a complaint an dhow to contact
OFTEL and a form for consumer feedback.
1.3 Through its quarterly meetings (held
in public) CCE organises its two main activities: preparing written
responses to OFTEL consultations and participating, through membership
of working groups with OFTEL staff and telecoms operators, in
policy deliberations, planning and implementation.
1.4 CCE submitted evidence to TISC's previous
inquiries into telephone numbering and into the work of OFTEL.
2. CCE and OFTEL
2.1 CCE maintains its support for OFTEL's
approach to consultation. We expressed the view in our previous
submission to TISC that OFTEL's policy development process is
2.2 CCE itself is frequently able to discuss
early drafts of consultation papers with the relevant regulatory
policy staff and CCE members have been consulted throughout the
process of publishing and reviewing comparable telecoms performance
indicators, preparing for the implementation of Carrier Pre-Selection,
developing and seeking consensus on a methodology for price comparisons,
and in many other policy areas.
2.3 More recently, OFTEL has consulted on
"co- and self-regulation". CCE and other advisory committee
members have been active participants in several "co-regulatory"
projects over the last few years, including the work that has
been done to provide comparable performance and price information
on telecoms services.
2.4 In our view, much of the recent press
hostility towards OFTEL was misconceived. We comment in more detail
below on ADSL (Asynchronous Digital Subscriber Line) and LLU (Local
Loop Unbundling). In summary:
LLU in the UK has been pursued with
vigour by the current Director General, reversing the policy of
on ADSL, there have been genuine
technical problems to overcome, and much of the delay in progress
has been due to the inability of competing operators to collaborate
to the extent needed to deal with co-location issues; and
on internet access, OFTEL has worked
hard, on NTS (Number Translation Services) policy, and on FRIACO
(flat-rate internet access call origination), on both issues with
the aim of enabling Internet Service Providers to bring their
retail prices down.
2.5 CCE's comments on the co and self-regulation
consultation and on OFTEL's recent consultation announcing a review
of the dial-up internet access market, are attached to this submission.
3. Access to mobiles
3.1 Consumer access to mobiles is surely
not in question. There has been huge growth in subscriber numbers
in the last year or so, particularly in take up of pre-paid services.
The four network operators have a more even share of the market
each than in other European countries. Prices have been falling
for some time, and the range of tariff options remains wide.
3.2 There remain some barriers. For those
customers, probably still the majority, with single-band handsets,
switching networks may involve purchase of a new handset. Some
service providers seem to be imposing quite high charges to port
mobile numbers, and we understand SIM-locking remains an issue.
3.3 In relation to IA (Indirect Access)
to mobiles, CCE responded to OFTEL's consultation last year on
this. We welcomed OFTEL's determination that Vodaphone and BT
Cellnet should be required to offer access to IA operators. We
expressed a hope that Orange and One-2-One would recognise the
marketing benefits of offering such access voluntarily.
3.4 CCE will be actively participating in
OFTEL's review of the mobile market. As our last TISC submission
said, we particularly wish to ensure OFTEL's market analyses do
not focus solely on the supply side, but also investigate consumer
4. Local Loop Unbundling
4.1 With hindsight, CCE regrets the decision
by the previous Director General to focus his promotion of competition
on infrastructure competition. Whilst cable operators are generally
undercutting BT prices it became clear some time ago that roll-out
was unlikely to reach more than 50 per cent UK households. Meanwhile
other countries were pressing ahead with LLU and CPS (Carrier
Pre-Selection). We believe CPS and LLU will benefit consumers.
Already those consumers aware of Indirect Access operators have
seen significant reductions in call prices as compared to standard
BT tariffs, and those service providers utilising BT's Calls and
Access product have been able to offer different bundled services
to customers. LLU should enable more providers to offer services,
at lower prices than Calls and Access has allowed.
4.2 CCE believes the current Director General
deserves credit for his vigorous attempts to maximise progress
towards LLU. In the face of considerable technical difficulties,
and problems in getting the industry to collaborate effectively
to the extent needed, OFTEL has succeeded in bringing forward
the process as quickly as we believe possible.
4.3 We would also acknowledge that there
have been and are immense technical hurdles to overcome. Facilitating
ADSL and IP (Internet Protocol) in particular, and providing for
a significant number of competitor providers to make use of LLU,
has meant a considerably more complex process than that which
faced other countries, where LLU was promoted in the context of
largely narrow-band voice transmission and with fewer players
in home markets.
4.4 CCE believes LLU will bring benefits
for consumers. However OFTEL has a difficult balancing act to
perform. Under section 3 of the Telecommunications Act 1984, the
Director General has duties to promote competition and protect
consumers. But he also has specific duties to ensure the provision
of telecoms services to satisfy all reasonable demands, to ensure
that operators providing such services are able to finance their
provision of those services, and to promote efficiency and economy
in their delivery. These duties impose upon OFTEL the need to
bear in mind both the financial impact on BT as a public company
and the technical demands made of its network, when assessing
the competitive and other pressures upon the BT network.
4.5 CCE does not wish to be seen as an apologist
for BT. However we do have genuine concerns fo the stability of
the company and particularly for the technical resilience of its
network, which, despite growing competition remains and will remain
absolutely fundamental to the public provision of telecoms services
in the UK.
4.6 CCE therefore welcomes LLU and progress
towards ADSL, but believes neither should be pursued in such a
way as to risk de-establishing the BT network.
5. Leased lines
5.1 CCE has prioritised its attention to
those OFTEL projects most affecting residential consumers. We
are not able to respond to every consultation and have not specifically
commented in response to the OFTEL consultation on leased lines.
[Note the Scottish Advisory Committee on Telecommunications has
responded.] We recognise that the cost of leased lines does impact
on consumers as end users, given their use by eg Internet access
providers. In general CCE supports the approach suggested by OFTEL
in the consultation paper.
The Secretary of State for Trade and Industry
appoints members and Chairmen to CCE (the English Advisory Committee),
SACOT (Scotland), WACT (Wales) and NIACT (Northern Ireland). Members
and Chairmen of DIEL (representing the interests of the disabled
or elderly) and CfB (Communications for Business, representing
the interests of small businesses) are appointed by the Director
General of Telecommunications.
The committees are advisory NDPBs, with a small
secretariat of three OFTEL staff in London, and local staff in
Edinburgh, Wales and Belfast. In total the running cost of the
six committees is approximately £450,000 in the current
financial year. This is financed from programme expenditure within
The Director General has statutory responsibility
to receive consumer complaints and take regulatory action where
appropriate. He has delegated this responsibility to the ACTs
in Scotland, Wales and Northern Ireland so that consumers get
a local response. An 0845 or local rate phone number provides
access to the complaints service, with calls routed to OFTEL or
the respective Advisory Committee office according to the country
from which the call is made. CCE does not have complaints-handling
responsibilities, but monitors enquiry trends and receives regular
reports from OFTEL on complaints handled.
The committees form their views independently
of OFTEL, and see both strengths and weaknesses in the current
"semi-detached" relationship with OFTEL. OFTEL operates
a consultative policy-making process, with ACT members and other
consumer organisations involved in ad hoc working groups with
OFTEL staff and allowed opportunities to comment on early drafts
of most consultation papers. In addition OFTEL consults the advisory
committees and others on its annual work programme. The Director
General attends a number of ACT meetings each year including regular
meetings with the Chairmen.
The committees are required to report annually
on their work. This they do in an appendix to the OFTEL Annual
Report, and independently, in leaflet format, incorporating both
an annual review and a summary of their key interests for the
Committee reports and information about ACT
meetings are published on an independent web site (www.acts.org.uk).
CCE quarterly meetings are held in public.
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