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New compensation schemes to force Openreach to perform better
Thursday 20 March 2008 15:57:11 by Andrew Ferguson

BT Openreach was created as a separate division within the BT Group in an effort to make it easier for communications providers to provide products that compete with the telephone and broadband services from BT Retail. This change has resulted or at the very least coincided with a rise in the use of products such wholesale line rental, carrier pre selection and unbundled services, but to date the penalties for Openreach when it fixed faults too slowly or failed to activate lines on agreed dates have been so small that there was little incentive to perform well.

New service level guarantees (SLGs) are set to come into force for Openreach from 25th June 2008. The full details can be found on the Ofcom website, but the key points are:

  • Openreach to make proactive payments for Wholesale Line Rental (WLR) services for things like late provision and late fault delivery. The compensation will be one month's line rental for every days delay.
  • Unbundled (LLU) connections will carry a £8 compensation for every day a LLU line is late in being delivered. This increases to £16 a day if the line is delivered but in a non working state.
  • Ethernet services will have compensation increased for late delivery to one months rental / day of delay. Where a fault takes longer to fix than the partial private circuit enhanced care option allows for then 15% of the monthly rental will be payable for each hour of downtime until the fault is resolved.
  • Caps on compensation for the products to be removed and other unnecessary restrictions to be removed too.
  • Compensation if the Equivalence Management Platform (EMP) is unavailable outside of scheduled outages. This starts at £20 per relevant transaction for a 2 hour outage, rising to £100 per transaction for failures longer than 8 hours in a number of steps.

It should be pointed out that this compensation is to the communications provider and whether any of this will be passed onto businesses or consumers will depend on your contract with them. For compensation over individual line issues we would hope that providers will pass on something to its customers.

The charges raised by Openreach for engineer visits that discover the fault to not be on the Openreach network have been unpopular, but it looks likely that with a new harsher compensation environment, Openreach will be even more keen to look into faults and if possible show it is not their problem. To this end, providers broadband support centres will need to improve and make much better use of the diagnostics systems available to them, for example, all broadband providers using an IPStream service should be able to see what your IP Profile is without having to send you to the BT Wholesale speedtester, but this information often appears to be hidden from support staff.

Comments

Posted by chrysalis over 9 years ago
yeah this is going to work both ways, I am happy there will be a SLA but openreach will claw the money back and I expect the actual engineering costs when applicable are going to be increased soon.
Posted by dayday01 over 9 years ago
anything that improves the stability of ADSL lines is to be welcomed. However, the solution is to increase the level of investment ... if French users can get 100Mbps to the house at the same price as we pay for "up to 8Mbps" this would alyer the situation significantly. A first stage would be to set the minimum fault level at a realistic level. 400Kbps for a theoretical 2Mbps seems to be absurd!
Posted by Kempy over 9 years ago
Increasing the level of investment requires a return on that investment. And that means that we as consumers have to be prepared to pay for it. dayday01, why would BT or anyone want to sell you 100mbps for the price they can sell you 8mbps? It will take 10 times as long to achieve their ROI. Only in the Internet space do we expect companies to invest millions and then not see a return. if we all got the bandwidth we had paid for their networks would crash Its too cheap now - which is why the big four ISPs are all traffic managing our connection to minimise the bandwidth
Posted by AndrueC over 9 years ago
@Kempy:Well put.
Posted by Dawn_Falcon over 9 years ago
Kempy - Nuts. Absolute nuts. I'm willing to pay for a quality product, but because of the way BT have set up the centrals there can only be a cheap, mass market product and a reliance on overselling massively.

This is entirely on BT's plate - before they changed the rules and ensured that only they would make any deacent profit off the basic provision of internet services there was a variety of packages.

All ISP's, excepting a few LLU ones, have to massively oversell or go bust.
Posted by AndrueC over 9 years ago
@Dawn_Falcom:Not true. Look at all the bundled deals and how successful they have been. The greater public has spoken and what they have said is "Make it as cheap as possible". The issue of central pricing is a red-herring. If ISPs want to order more capacity they can do so. They just need to raise the subscription charges.

Unfortunately they know that the general public won't go for it. BT is covering it's ass because it can. It at least can charge a viable figure. That's not BT's fault. It's up to the ISPs to explain to the public and sell the value of a decent service.
Posted by comnut over 9 years ago
Dawn_Falcon: The reason WHY the BT centrals have been set up that way, is because the public demanded a cheap, mass market product...
- only now they have realized that gives you cheap service!!

It took long enough for BT to get THAT going, how long will it take *** 80% *** of the public to demand higher prices, for higher service??? I think pigs will fly....

Posted by 2doorsbob over 9 years ago
I think this is a good idea in general but is about 10 years too late ..to have new adsl technology run down ageing aliminium pair along unducted estates is asking for trouble ..my arguement is BT should have maintained the local loop to keep up with the times therefore alot of these qos issues would be resolved people would get more of there upto figure ...continued
Posted by 2doorsbob over 9 years ago
kempy1 has a piont we cant expect BT to foot the fibre bill but we can expect them to to look after there customers instead of there shareholders ..dawn_falcon has got something hear aswell you only get what you pay for and the general public will learn this for themselves you can't compare the likes of demon to talk talk or tiscali there not in the same league
Posted by 2doorsbob over 9 years ago
but if the infastucture isn't good whatever product you put on it will be poor
Posted by Dawn_Falcon over 9 years ago
AndrueC - No, when your product is pap the only way to sell it is margain slashing. Their is o quality product avaliable unless you can go LLU.

It is 100% BT's issue with the way they sell central services. Are you going to blame ISP's when BT's "21CN" raises their costs massively?

Comnut - "the public" had absolutely no say in it, it was "British Telecom". Nice myth.
Posted by ramsgatonian over 9 years ago
If the French can have a 100mbps for what we pay for an upto 8mbps service, then I say let's all demand equality under Euro law.
That should cause a laugh all round.
Posted by herdwick over 9 years ago
"BT's 21CN raises their costs massively" how exactly does WBC increase ISP costs ?

You can have any quality you're prepared to pay for. >95% of the population want a connection at the lowest possible price so that's what the majority of products deliver.
Posted by Dawn_Falcon over 9 years ago
Provide the survey data showing your >95% claim. There is no "majority", all consumer products on BT centrals oversell massively just so they can exist at all.

And if you don't understand the way they're dumping admin costs onto ISP's and making non-core exchange connections far more expensive to run...
Posted by AndrueC over 9 years ago
@Dawn_FalconDawn_Falcon: The reason WHY the BT centrals have been set up that way, is because the public demanded a cheap, mass market product...:""

You're not making any sense. You blame BT for the mess whilst at the same time say that they are giving the public what the public wants.

That's what I wrote.
Posted by AndrueC over 9 years ago
@Dawn_Falcon:Are you labouring under the misaprehension that BT is some kind of public service or charity? They don't exist to provide a decent BB service.

They exist (like any other private company) to make a profit by providing the customer with what the customer wants.

This they are doing. Even you admit they are doing it. The British public (by and large) have voted with their wallets. Even in discussions about finding another ISP because of traffic shaping people still look for the cheapest service.

The public has spoken and BT are only following their demands.
Posted by herdwick over 9 years ago
All consumer products are priced to sell, consumers want broadband for free, £6.99, £15 and other perceived prices and the product is designed to match that. If someone wants to pay more and get more the products are there.

For the basic up to 8M service the WBC 21CN broadband product only has a £1.80 per month difference for the end user circuit based on geography. For the faster services there's a further £.170 per month difference (£3.50 total).

There is *no* difference for the aggregation, bandwidth and network charges based on geography.
Posted by herdwick over 9 years ago
Here's what "Broadband Britain" looks like if you depend on LLU :-

http://www.samknows.com/broadband/mapping/custommap.php?q=all_llu

Posted by comnut over 9 years ago
The term 'bandwidth' is a VERY misused one!! http://en.wikipedia.org/wiki/Bandwidth

'data rate' or 'speed' is better, different from 'latency' or PING (the time it takes for ONE pulse to get there)...
Posted by comnut over 9 years ago
The main problem with LLU is that it is *very* new, and was seen as an alternative to being 'messed about' by all the layers of BT.. Even some ISPs had this problem..

Trouble is, without the 'support' of BT, LLUs are totally in the dark, and have also made some *very* bad decisions...

Posted by Dawn_Falcon over 9 years ago
Andrue - YOU think they are giving the public what they want. I do not. NOT. They are giving the public *no choice*. This is radically different.

BT could of quite easily maintained multiple pricing schemes, some of which would of been better for them in the longer term, but no - one scheme which allows only one strand of ISP pricing.


herdwick - Because that is the only possible thing to do given how BT's charges work.

(And under 21CN there *are* differential charges)
Posted by CARPETBURN over 9 years ago
quote"The main problem with LLU is that it is *very* new"

LOL @ new LOL

The main problem with LLU is the fees BT charge LLU providers to get into an exchange.... remove that hurdle and everyone in the country could have cheaper and faster broadband.
Posted by Somerset over 9 years ago
What do they charge?
Posted by CARPETBURN over 9 years ago
quote"What do they charge?"

You would have to ask BT, i can say they do charge though, looking at details and links on ofcoms website makes that clear.
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