UK telecoms complaints at an all time low

The latest complaints data shared by UK telecoms regulator Ofcom reveals the level of moaning are at their lowest since it started collating them.

Ofcom has been logging consumer complaints about landline, broadband, mobile and pay TV services since 2010. The fact that they are at their lowest level ever would appear to indicate UK CSPs are doing a great job. Of course people could have just given up, or have become steadily more apathetic, or have found more effective ways to punish errant telcos than moaning to Ofcom, but let’s give them the benefit of the doubt.

“Although we’re encouraged that complaints are at their lowest levels since we started shining a light on this, some telecoms and TV companies are still falling short,” said Jane Rumble, Ofcom’s Director of Consumer Policy. “We expect those providers to up their game and deliver better service to all their customers.”

In the tables below you can see first the historical totals for the four categories of complaints and then the most recent ones for broadband, mobile and pay TV. We haven’t bothered with the landline ones because we figure nobody cares anymore. Now that Vodafone has got its act together there are no outstanding poor performers in mobile and similarly BT seems to have sorted out its pay TV operations.

Ofcom Q2 18 complaints historical

Broadband

Ofcom Q2 18 complaints broadband

Mobile

Ofcom Q2 18 complaints mobile

Pay TV

Ofcom Q2 18 complaints pay TV

Ofcom’s competitiveness quest continues with another ducts and poles assault

Ofcom has unveiled its latest edition of its business connectivity market review with an all too familiar feel; how can it force Openreach and BT to play nicer with competitors.

As with any former state-owned monopoly, BT/Openreach is in the enviable position of having the groundwork already laid for future-proof infrastructure. Of course it has not done enough across the years to meet the demands of tomorrow’s fibre-based diet, though one factor behind this is a lack of external pressure on the business. Without competition, the enforced need to invest and innovate is not there. This is ultimately Ofcom’s objective; create an environment which encourages other ISPs to lay their own connectivity foundations, decrease the reliance on Openreach and improve connectivity options for the consumer.

“We want to give companies greater flexibility to lay fibre networks that serve residential or business customers,” Ofcom said in a statement. “So today, we are consulting on proposals to allow access to Openreach’s ducts and poles to companies offering any type of telecoms services including high-speed lines for large businesses, networks carrying data for mobile operators and high capacity lines supporting broadband services. We intend to implement this unrestricted duct access from spring 2019.”

This review focuses on the areas where there is minimised or no competition for BT. Ofcom believes BT currently has almost 5,600 local exchanges, though at roughly 5,000 of these sites there is competition from fewer than two competitors. BT’s position has been deemed unacceptable in these areas.

Starting with the areas where there is evidence of potential competition, but BT still maintains ‘significant market position’, Ofcom will no longer impose a cost-based charge control or quality of service standards on BT’s wholesale services, which combined with access to BT’s ducts and poles, the theory is competitors will have a stronger incentive to build their networks.

In areas where network competition is unlikely to be a reality, Ofcom has proposed a price cap for services at 1 Gbps and below to protect customers and provide certainty and stability over the course of the review. What is worth noting is that this is a relatively short-review, as while the proposals could come into play next spring, 2021 would see a new review and therefore new proposals.

The final proposal comes at the 4,300 exchanges where BT faces no competition from rival operators for inter-exchange connectivity, and Ofcom has deemed opening up the ducts and poles will have little impact. Rival networks are too far from these exchanges to make it economically viable to serve these exchanges, therefore BT is the only choice as a supplier for backhaul. Ofcom is proposing a requirement for dark fibre at cost for inter-exchange circuits that connect to these locations.

This is of course not the first time the dark fibre suggestion has emerged from Ofcom. In April, Openreach officially launched a compromise between full dark fibre access and full managed service after months of bickering and reviews with BT attempting to resist the Ofcom intervention. Ofcom seemingly lost that battle, with fingers being pointed at suspect market definitions, though now it appears ready to restart the assault.

This is of course only the consultation stage of the process, though the plans are to get the new rules in place by next spring. Whether this timetable is realistic with the almost guaranteed legal challenge from BT remains to be seen, but this is just another step in the never ending Ofcom quest to improve connectivity and competition across the UK.

Ofcom officially releases BT from its Openreach undertakings

Measures BT undertook in 2005 to placate Ofcom over its wholesale operations are officially no longer relevant, so it doesn’t need to bother.

This seems to be a bit of a formality, since the legal separation of Openreach from BT is supposed to mean BT has no direct influence over the fixed line wholesaler. But at the very least it marks a milestone in BT’s relationship with Ofcom and gives Philip Jansen one less thing to worry about when he takes over next year.

The previous milestone was the official transfer of 31,000 staff from BT Group to Openreach at the start of this month. “This is an important day for Openreach as we’re fulfilling the commitments to Ofcom under the Digital Communications Review,” said Openreach Chairman Mike McTighe at the time. “Openreach now has its own Board, greater strategic and operational independence, a separate brand and an independent workforce – and we’re ambitious for the future.”

The long and short of it seems to be that Openreach now has a separate and distinct relationship with Ofcom and will be assessed solely on its own merits, with no BT baggage. This is probably good news for everyone and is ultimately what all this ‘legal separation’ business is supposed to be about. It should also protect Openreach from accusations of favouring BT. You can read the full statement here.

A possible manifestation of this new, unfettered Openreach may have been the announcement last week that it is dropping the price of full fibre broadband infrastructure to new homes by 75%. Openreach got a nice lot of kudos from public figures for doing its bit to improve fibre coverage, so job done there.

Ofcom isn’t happy with EE and Vodafone’s coverage predictions

UK telecoms regulator Ofcom has opened separate investigations into coverage predictions offered up by EE and Vodafone.

In what seems like a fairly pedantic move Ofcom has announced it’s looking into information provided by the two MNOs when it asked them to say how much of the country they expect to cover. Bizarrely EE is suspected of overestimating its 3G coverage, while Vodafone may have under-predicted its 4G coverage.

Why any of this matters is unclear. Ofcom uses these estimates for its own studies into UK mobile coverage, which are ultimately politically sensitive due to the tendency for politicians to grandstand on behalf of those people with dodgy coverage. It’s possible that Ofcom is getting political heat and is looking for scapegoats. Here are the two Ofcom statements.

“On 1 October 2018, Ofcom opened an investigation into EE’s compliance with requests for 3G mobile coverage predictions across the UK under these rules. This followed on from the identification by Ofcom of errors in the 3G/2100 MHz coverage data that EE provided which meant that its 3G coverage was over-predicted, particularly in rural areas.”

“On 1 October 2018, Ofcom opened an investigation into Vodafone’s compliance with requests for 4G mobile coverage predictions across the UK under these rules. This followed on from the identification by Ofcom of errors in the 4G/800 MHz coverage data that Vodafone provided which meant that its 4G coverage was under-predicted, particularly in rural areas.”

As indicated by the beeb, the operators will claim some combination of innocence, mitigation and contrition, so it’s hard to imagine anything significant resulting from these probes. Maybe Ofcom just likes to throw this sort of thing at operators every now and then just to keep them on their toes.

Ofcom ponders how to rid the internet of horridness

Nobody’s in favour of censorship but freedom comes at a price, right? This is essentially the premise for a new Ofcom discussion paper on online content.

Entitled ‘Addressing harmful online content’, the document has been published alongside some research specially commissioned into people’s concerns about online content. Its stated aim is to initiate a public conversation about this stuff but it gives the impression of trying to set the course of that debate in the direction of greater regulation and censorship.

The tension between security and freedom is as old as civilization and there are some standard techniques for persuading people to surrender their autonomy. A word currently in vogue is ‘harm’, which has the benefits of being emotive, universally disapproved of and yet broad enough to be subject to constant redefinition. If you can get people to agree that harm must be opposed then you can establish consensus on anything else so long as you position it in opposition to harm.

If harm alone isn’t emotive enough then it’s just a simple matter of determining the freedom you want to take away is harmful to children, and this is where many arguments in favour of regulating the internet start. Also likely to make an early appearance are ‘but’ phrases such as ‘the internet offers many benefits but…’ or ‘freedom of speech is important but it comes with responsibilities.’

The Ofcom discussion document is no different, but (you see, it’s easily done) it does appear to aspire to some degree of balance and thoroughness. After the standard preamble about how children need to be protected from horridness online (which is hard to disagree with, the question is how), it notes that regular broadcast TV is a lot more regulated than online platforms like YouTube.

Ofcom broadcast regulation table

The stuff about the BBC is irrelevant as it’s tax-funded and thus subject to a unique level of state interference. Ofcom gets to keep an eye on other broadcaster’s catch-up services but has no role in any other online content. IT reckons other online press is regulated by IPSO, which is not even approved as a regulator, and IMPRESS, which is not supported by the press. We can assure you that Telecoms.com has had not contact with either, but perhaps we will after this.

Ofcom also laments the different amounts of regulation a piece of video is subject to depending on how it’s consumed. Live TV gets a lot of oversight, catch-up less so and YouTube none right now. The growing impression is that a lot of this is targeted very specifically at YouTube, which also happens to be where children increasingly go to for video.

Ofcom broadcast regulation table 2

The document then moves on to a cherry-picked selection of anecdotes describing positive outcomes of the kind of regulation it seems Ofcom would like to see more of. In the absence of equivalent negative anecdotes, who can Ofcom expect this to be considered evidence in any honest and rigorous sense of the word?

More balance is shown when the document moves onto the challenges of trying to regulate a platform such as YouTube. They include the scale of the platform, the variety of content on it, the fact that much of it is user-generated and the fact that it’s global. There is also a genuine attempt to explore the dichotomy we flagged up at the start of freedom versus security.

“Another relevant principle is the safeguarding of freedom of expression,” says that passage. This means that people are able to share and receive ideas and information without unnecessary interference, such as excessive regulations or restrictions. When the need to protect audiences from harm comes into tension with the need to preserve free expression, the weight that a regulator places on the two aims reflects the priorities set by Parliament, as well as audiences’ evolving attitudes.

“Depending on the weight attributed in an online context, there is a risk that regulation might inadvertently incentivise the excessive or unnecessary removal of content that limits freedom of speech and audience choice. Such concerns have been raised in the context of the new German law.”

“Our experience in regulating broadcasting shows that while balancing audience protection and freedom of expression is not straightforward, it can be done in a way that is transparent, principles based and fair. Applying this to an online world might translate into greater attention to the processes that platforms employ to identify, assess and address harmful content – as well as to how they handle subsequent appeals.”

A lot of very good points were made by that passage, but the concluding one would seem to fundamentally undermine calls for greater regulation. These platforms (as well as the press) already have loads of processes in place to tackle exactly the harmful stuff Ofcom seems to be worried about. Many would argue YouTube has already gone too far in this respect (albeit mainly to placate advertisers), but in any case doesn’t that render calls for regulation redundant?

Another part of this discussion document that seems somewhat self-defeating is the research. You can see the headline data points below, which seems to indicate the majority of the UK is pretty worried about a bunch of stuff online. This in turn would appear to be a clear call to action for Ofcom and the government to intervene in order to reassure and protect the anxious electorate.

Ofcom survey findings

But when you navigate through the supporting documents you can see a very big gulf between spontaneous and ‘prompted’ responses. It is to Ofcom’s credit that it has been so transparent about the findings, but it must also know that the vast majority of media will simply report the headline figures without nuance or caveat. That sounds dangerously close to the kind of ‘fake news’ that everyone claims to be so worried about online.

Ofcom survey findings prompted

Ofcom survey findings prompted 2

It’s right that Ofcom should take the lead in initiating a (somewhat belated) public discussion on how the wild west of the internet should be approached. But it’s hard to escape the impression that its desired outcome will be new powers and laws that restrict online activity in the name of shielding our delicate, innocent eyes and ears from ‘harm’. If the internet is all about greater choice then shouldn’t we be trusted to decide for ourselves what’s in our own best interests?

Watershed moment: should mobile operators be worried we talk less?

A new report from Ofcom claims users in the UK spoke 2.5 billion minutes less on their mobile phones, down by 1.7% in 2017, the first such decline in history.

This followed the trend total talking time by the UK population has been declining over several years, primarily mainly driven by the sharp drop in minutes spent on fixed line phones. The combined talking time also suffered the sharpest drop in years, at more than 6%. See the chart from Ofcom’s The Communications Market 2018 report (p.17) below.Ofcom report call minutes decline

In some ways mobile operators should be concerned. After OTT messaging services (WhatsApp, Viber, WeChat, etc.) destroyed the text message cash cow, it looks they are also losing another revenue stream, the voice call.

However it does not necessarily mean we speak less. Some simply move the calls into other apps, especially when we need to speak to people overseas, more than one people at the same time, or when we like to combine video with audio. Group video call features from WhatsApp or Skype and others come handy.

Operators’ response is not too dissimilar to the one when they tried to fend off the OTT messaging services. After throwing in unlimited number of text messages to typical packages, they now often throw in unlimited minutes. However this does not look to have reverted the trend of fewer minutes spent on voice calls, just like the unlimited text message offers have not reverted the decline in SMS and MMS (p.20).

Ofcom report SMS decline

The experience of messaging apps may be superior when handling rich features, but it needs internet connection, and it consumes data, which is exactly what operators are working hard to monetise. Some choose to offer bigger data buckets at a higher price, while others bundled with value-added services, for example video streaming. The result shows people do pick up higher packages. The total mobile retail revenues dropped by 1.3% from 2016, but revenues from mobile packages grew by nearly 3%, while revenues from out-of-bundle data near held. The biggest drop occurred in out-of-bundle voice. It seems for most people the bundled voice was already more than enough.

Ofcom report revenue types

UK government unveils its cunning plan for future telecoms

Some UK officials had a bit of a think about telecoms infrastructure and were so pleased with the outcome they wrote it down and published it.

Whitehall’s condensed telecoms wisdom has manifested itself in the form of the Future Telecoms Infrastructure Review – a 90-page brain dump full of top tips on how to make the UK better at telecoms, with a heavy emphasis on ‘full fibre’. Only this, it seems, will keep our national pipes healthy and regular.

We want everyone in the UK to benefit from world-class connectivity no matter where they live, work or travel,” said new Secretary of State for this sort of thing Jeremy Wright. “This radical new blueprint for the future of telecommunications in this country will increase competition and investment in full fibre broadband, create more commercial opportunities and make it easier and cheaper to roll out infrastructure for 5G.”

Sounds good Jezza, so let’s take a closer look. Here are the key recommendations from the report:

  • New legislation that will guarantee full fibre connections to new build developments;
  • Providing operators with a ‘right to entry’ to flats, business parks, office blocks and other tenanted properties to allow those who rent to receive fast, reliable connectivity, from the right supplier at the best price;
  • Reforms to the regulatory environment for full fibre broadband that will drive investment and competition and is tailored to different local market conditions;
  • Public investment in full fibre for rural areas to begin simultaneously with commercial investment in urban locations;
  • An industry led switchover (from copper to full fibre) coordinated with Ofcom;
  • A new nationwide framework which will reduce the costs, time and disruption caused by street-works by standardising the approach across the country;
  • Increased access to spectrum for innovative 5G services
  • Infrastructure (including pipes and sewers) owned by other utilities such as power, gas and water, should be easy to access, and available for both fixed and mobile use;
  • Ofcom to reform regulation, allowing unrestricted access to Openreach ducts and poles for both residential and business use, including essential mobile infrastructure;
  • Alongside the FTIR, Government has also published a Digital Infrastructure Toolkit which will allow mobile networks to make far greater use of Government buildings to boost coverage across the UK.

To be fair there do seem to be some genuinely useful measures in that list. Improved access to sites is something regularly called for by operators and if that, together with a significantly more benign regulatory environment, is actually delivered, then telcos will have far fewer excuses for not just cracking on with the job. Having said that the obligation for new builds to have full fibre connections could further inhibit that already feeble industry.

“We welcome the government’s review, and share its ambition for full-fibre and 5G networks to be rolled out right across the UK,” said Ofcom Chief Exec Sharon White. “The government and Ofcom are working together, and with industry, to help ensure people and businesses get the broadband and mobile they need for the 21st century.”

The ‘notes to Editors’ at the end of the press release seek to further illustrate what a great idea ‘full fibre’ (i.e. FTTP) is. In a blow to technologies such as Gfast they note that running fibre and copper in parallel is inefficient. They also reckon that ‘if we get the conditions right’ the market should deliver 80% FTTP coverage (Portugal is already at 89%), despite onlt being at 4% right now.

The company largely responsible for delivering 20x more fibre than we currently have will be Openreach. “We’re encouraged by the government’s plan to promote competition, tackle red tape and bust the barriers to investment,” said an Openreach spokesperson. “As the national provider, we’re ambitious and want to build full fibre broadband to 10 million premises and beyond – so it’s vital that this becomes an attractive investment without creating digital inequality or a lack of choice for consumers and businesses across the country.”

The report doesn’t quantify the total number of premises in the UK but it does say around a million currently have FTTP, and since that represents 4% of the total that gives us 25 million premises. In turn that means Openreach’s lofty ambition would still only get us half way to 80% so there remains a lot of work to be done.

A lot of that, it seems, will be done by CityFibre, which is aiming to connect 20% of the country to fibre by 2025. “Today marks the day the government decided once and for all to leave copper behind and commit the UK to a full fibre future, making clear that a new generation of infrastructure builders is the vehicle for delivering its bold ambition for all homes and businesses to be connected to full fibre by 2033, not just Openreach,” said Mark Collins, Director of Strategy at CityFibre.

“However, it is critical that the consumer is at the heart of this fantastic opportunity from the start, as this is the key to unlocking demand. That means avoiding price rises, ensuring switching between networks is simple and ending the years of misleading ‘fake fibre’ advertising. Getting both sides of the equation right is key to ensuring millions of homes and businesses will benefit – we now need to see the Government and Ofcom push these plans through.”

CityFibre isn’t the only independent fixed infrastructure player to cautiously welcome the report, but with an air of ‘I’ll believe it when I see it. “We welcome the Government’s statement today that a switchover from hybrid to full fibre networks could be underway in the majority of the country by 2030. But the devil is in the detail,” said Evan Wienburg, CEO of full fibre infrastructure provider TrueSpeed.

“While the Government is right to state that a full-throttle drive to nationwide full fibre connectivity requires competition and commercial investment to succeed, a fair and equitable playing field for all infrastructure providers is essential,” said  This has not always been the case. There are numerous examples of tax payers’ money being wasted by national incumbent providers building FTTC/FTTP networks in areas where privately funded infrastructure providers have already deployed.”

Coinciding with the publication of this report is the formation of a pan-European alliance of indie fibre providers, including CityFibre. Its aim seems to be to promote the wholesale-only model and make sure fibre means fibre in broadband advertising. The alliance doesn’t seem to have a name yet but something like the Fibre Union of Connectivity Kings might do the trick.

At the very least this report and its recommendations give outfits like CityFibre a concrete set of parameters to refer to when embarking on one of their regular moans about how unfair the UK infrastructure market is. It looks like the government is committed to doing everything it can to encourage fibre investment and it should definitely be held to account for that over the coming years.

Streaming officially overtakes traditional Pay TV in UK

It’s been a watershed moment on the horizon for some time, but new figures from Ofcom confirm subscription numbers for streaming services have overtaken the ‘traditional’ pay TV market in the UK.

The Media Nations Report claims there are now more subscriptions in the UK to Netflix, Amazon and Now TV than there are to ‘traditional’ pay TV service providers. Traditional pay TV subscriptions totalled 15.1 million, while it was 15.4 million for the streaming subs. While this is a moment we have been anticipating for a while, the change will only accelerate as more streaming services develop partnerships to ease access for the consumer.

“Today’s research finds that what we watch and how we watch it are changing rapidly, which has profound implications for UK television,” said Ofcom CEO Sharon White.

“We have seen a decline in revenues for pay TV, a fall in spending on new programmes by our public service broadcasters, and the growth of global video streaming giants. These challenges cannot be underestimated. But UK broadcasters have a history of adapting to change. By making the best British programmes and working together to reach people who are turning away from TV, our broadcasters can compete in the digital age.”

As you can see from the chart below, younger generations are spending less time on broadcast television, preferring online formats, a trend which will compound the decline.

Ofcom TV Trends

With the more attractive demographics accelerating the decline, the traditional pay TV is going to become even less popular. Consumer habits are shifting online, and advertising revenues always follow consumer habits. With less advertising money being received, these providers will have less budget to compete with quality programming. It’s a self-fulfilling prophecy which ultimately leads to the death of traditional formats.

After several years of attractive growth, pay TV providers saw a 2.7% decrease in total revenue last year to £6.4 billion, while the spending on original programming is also declining. The BBC, ITV Channel 4 and Channel 5’s £2.5 billion combined network spending on original UK-made programmes in 2017 is 28% less than the 2004 peak of £3.4 billion. Admittedly this is not a direct representation of the pay TV subscription market, it does demonstrate the pressures faced by traditional content providers.

This is a change over which we have been expecting for a while, but perhaps this is another reality check needed by the telco industry to improve infrastructure.

Ofcom wants 57-71 GHz band to be free for fixed wireless

UK telecoms regulator Ofcom has reserved a bunch of unlicensed high frequency spectrum to be used for fixed wireless links.

Following the usual exhaustive consultation process the 57-66 GHz band has been cleared of interlopers so that the telecoms industry can use it for things like wireless backhaul, video transmission and fixed wireless access. At the same time it’s also in the process of freeing up the 66-71 GHz band and has launched a new consultation designed, it seems, to harmonise those two bands into one fat pipe of unlicensed fixed wireless goodness.

Here’s the Ofcom statement heralding the new consultation:

a) For short range wideband data transmission:

  • extend the current licence exemption and technical conditions (from 57 – 66 GHz) up to 71 GHz; and
  • introduce new technical conditions to allow licence exempt use of lower power equipment operating in a fixed outdoor installation in the 57 – 71 GHz band.

b) For fixed wireless systems:

  • extend the current licence exemption (from 57.1 GHz – 63.9 GHz) to 70.875 GHz, and by doing so, change the current authorisation approach for fixed wireless systems operating in the 64 – 66 GHz band from light licence to licence exempt; and
  • extend the current technical conditions (from 57.1 – 63.9 GHz) up to 70.875 GHz.

The deadline for this latest consultation is 6 August 2018. Presumably this is the opportunity for anyone currently using that spectrum for non-telecoms stuff to state their case, but this has the feeling of a done deal. While it won’t be used for actual 5G radio, having 14 GHz of clear spectrum for fixed wireless should contribute to the overall 5G effort, so this is welcome news.

BT gets a reminder Ofcom is still keeping a close eye on Openreach

Ofcom has released its first progress report on the legal separation of BT and Openreach, commenting progress is being made, but there still might be too much meddling going on.

The report, which you can see here, states there has been a satisfactory amount of work done, though there are still signs BT is fundamentally entwined in the organization. The problem here is simply down to the fact BT will not want to lose too much control. Current projects have focused on staff training and removing BT branding from Openreach, but these should be considered little more than window dressing and busy work; Ofcom needs to make sure BT cannot influence Openreach operations to its own benefit or the detriment of competitors.

The question still remains about balance. One of the concerns raised in the report is whether the new structure has struck the right balance between BT’s interests and those of Openreach. BT still has a major say in the Openreach strategy, and while this is still the case, few could deem this initiative a success. One example focuses on the investment plans.

“This is supported by emails exchanged between senior executives which demonstrate that BT was involved throughout the financial planning process,” the report states. “We are also concerned that BT’s newly established Investment Board reviewed Openreach’s investment proposals to be included in its strategic plans before the final draft plans were presented to the Openreach Board for approval. This is an issue that we will explore fully in the next monitoring period.”

Surely this should be considered contradictory to the purpose of having an independent board at Openreach. If BT is influencing the decision making process before the board is getting involved, the entire process of independence should be considered redundant.

There has of course been progress, it would be unfair to call this a disaster. However, in over a year the situation is fundamentally the same.