Broadband News

Ofcom publishes fairness framework

No one wants to find out they have been paying over the odds for their broadband for years and Ofcom inspired rules to ensure this should not happen anymore come into effect in February 2020. 

In an effort to set out how Ofcom will consider whether treatment of groups of customers is fair or not in the future a fairness framework has been published. The framework does not set absolute rules, partly because one of the problems with being treated fairly that is the goal posts do move shift and in a broadband market place which has many different technologies and many different infrastructure providers what is fair treatment for some may be very unfair for others.

To give people an idea of how Ofcom we judge if treatment is fair or not we've copied a small part of the framework that we believe will help people assess whether they are being treated fairly or not.

  ! We are likely to be more concerned where:
How do providers treat customers throughout the customer journey?

Information is not clear, easy to understand and timely;

Behavioural biases and/or other barriers to engagement are exploited in ways that adversely affect customers;

Customers are not supported in making well-informed decisions;

Problems are not fixed promptly;

Accessing complaints processes and independent dispute resolution services is difficult.

Who is being harmed, if anyone?

Vulnerable customers are being harmed;

The practice has no offsetting benefits, such as market expansion through low price offers.

What is the extent of the harm, if any?

The harm to each affected customer is significant; Many customers are affected;

The practice has persisted and is expected to persist for a long time.

The service is seen by customers as highly important or essential, rather than ’nice-to-have’.

How important is the service?

The service is seen by customers as highly important or essential, rather than ’nice-to-have’.

Does the service depend on risky new investment?

The service is a legacy service with predictable demand and costs (i.e. limited risk) and/or little need for new investment.

Questions to assess concerns about fairness Source: Ofcom

So while we know many would love to see it written into a stone tablet that a provider cannot have regional pricing e.g. Plusnet with its low cost areas that cover the majority of the UK; from our reading of the paperwork so long as Plusnet is very clear that its pricing varies according to its costs of provision even though the same underlying technology is used then it can persist. What they are not allowed to do is profile customer A and charge them less compared to customer B due to a large data profiling exercise.

One thought for a practice that would likely fall into the unfair category was maintaining a secret support call routing policy where 'gold' customers get directed to 2nd tier support automatically, 'silver' get the normal support desk with a queue jump and 'bronze' customers are stuck in a long queue.

While some say that nothing has happened with respect to fair treatment of broadband customers, we would contest this and point out some of the changes in the last year or two e.g:

  • The gap between In contract and Out of contract pricing has narrowed at a number of providers
  • TalkTalk with its fixed price contracts, helping people to budget over 12/18 or 24 month contract periods
  • Speed guarantees with money back
  • Six month half price, then another price until end of the minimum term and then another price when out of contract deals have diminished, reducing price confusion
  • BT Consumer now offering its ADSL2+ and entry level VDSL2/FTTP service for the same monthly price. Though there are possible questions around product up-sell with people being encouraged onto the Halo plans, when perhaps not everyone really wants or needs it.

The negative though is that contract lengths which seemed to be falling have risen such that 18 or 24 month contracts are now common and it is now at the point that some providers consider it part of a special offer when a 12 month contract option is available.

The end of contract notification along with details of the providers best offer while fairer for those who are happy with their provider and want to stay may hinder the take-up of full fibre services in the short to medium term, this is particularly the case for new market entrants who are trying to attract customers away from the biggest providers. In effect they may roll out to an area but find that only a handful are now out of contract and free to move.

One interesting thought is that the 'Does the service depend on risky new investment' question could be interpreted as meaning any retailer who is charging customers more for a legacy ADSL/ADSL2+ than it does for a faster service (be that VDSL2,cable or FTTP) is treating these people unfairly. So could a price cap for ADSL/ADSL2+ be on the way? 

Comments

Ofcom (moving as always at glacial speed) start to catch up with other consumer service regulators, albeit a decade or two late. Better late than never, but any thoughts on whether this will actually be monitored and enforced? Or will it be self policing where the regulator asks the ISPs to abide by it, but there's no active engagement by Ofcom with consumers who believe they've been treated unfairly?

  • Andruser
  • 28 days ago

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