AGENDA
- Introductions
- Background
to the Setting up of the Working Group
- Objectives
of Group
- Scope of
Work
- Relationship
with other Working Groups
- Possible
Allocation Methods
3. Identifying
the Issues
- Charging
Methodologies
- Allocation
and Annual Rental Charges
- Auctions
- Short numbers
4. AOB
5. Action Points
6. Future meetings
- Use of web
pages
- Membership
of Group
- Dates
Working
Paper -
Individual Number Allocation and a System for Charging
Purpose
This
Working Paper offers a framework for and some thoughts on the above
subject to assist the Working Group and external participants to
this informal consultation.
Framework
The
February 1999 report on Telephone
Numbering from
the Trade & Industry Select Committee concluded "We
think it vital that the efficiency with which the nation’s
resource of telephone numbers is used is increased and believe that
economic incentives are more likely to achieve this than regulatory
diktat."
The
May 1999 Oftel Statement on Developing Number Administration and
Freephone Numbering laid out that:
1.
individual number allocation should be introduced, to be carried
out by a Number Allocation Organisation paid for by annual rental
and allocation charges;
2. charges
for allocations of individual numbers, amongst others, should be
introduced; and
3. a
period of informal consultation would take place including a Working
Group set up to consider how best to set up the system of charging
for individual number allocations.
Before
dealing with the central issue of how to structure a charging system,
it is important to explain why Oftel sees the need to charge "above
cost" for what have been termed "golden", "attractive",
"coveted" or "memorable" numbers. The vast majority
of numbers does not fall into this category and there are no plans
to charge for others at "above cost".
It
is demonstrably true that some numbers are more attractive than
others, chiefly because they are memorable or more memorable than
others. The fund of these numbers is small and they are intrinsically
scarce, for instance there is only one 0800 40 40 40, only one 0808
0808080 and only one 0800 28 28 20. Because they are scarce, it
is necessary to administer them and, in this context, allocate them
in a manner that makes it uneconomic to hoard attractive numbers,
to cherry-pick attractive numbers from number blocks or otherwise
use them inefficiently. The effect of this should then be that the
use of a number should go to the person or organisation that, for
legitimate business or personal reasons, places the highest value
on it.
Economists,
the European Commission, consumer bodies and the Trade & Industry
Select Committee all agree that we should charge for attractive
numbers (initially 080 and 090 numbers) in a way that ensures their
efficient use. Operators have also historically adopted this policy
under powers given to them in licences.
Objectives
The
overall objectives of the working group are:
To
suggest and consider methods of and mechanisms for charging for
numbers.
AND
To
fully explore the practicalities of, including the possible obstacles
to, setting up a charging system for numbers.
The
framework in which the group is to achieve these objectives are
set out in more depth in the working group Terms of Reference.
Requirements
for the Scheme
Next we should consider what criteria the individual numbering allocation
scheme should fulfil. These would seem to include some or all of
the below. The scheme:
should
promote efficient use of numbers;
should not need frequent alterations;
needs to be easily understood;
needs to be workable and not add unduly to the complexity of the
allocation system;
should be sound under UK and European law;
should give no unfair competitive advantage to any operator or
user;
should not give rise to windfall gains;
should obtain market value for attractive numbers;
should safeguard access to attractive numbers for public bodies
and charity helplines.
Possible
Elements of the Charging Mechanism
Three
possible elements for coveted number charging are:
1.
Fixed rate charge
All
numbers specifically requested by the customer – i.e. not
the next one along – are charged a flat "coveted"
number rate regardless of how memorable or otherwise attractive
a number is.
This
is easy to operate but does
not reflect the relative economic value of the number –
e.g. 0800 10 10 10 would cost the same as 0800 9 741 236 if
both were specially requested.
2.
Charging Algorithm
A
means of categorising numbers – e.g. "platinum",
"golden", "silver", "standard"
(which would include all others) and associating a charge to
each category.
This
would allow immediate allocation (ie not having to wait for
auctions) but it would be difficult to determine categories
and values.
It
would be necessary to determine the range of possible number
presentations. For example, the number 0802 4242424 could be
presented in several ways, including 0802 4242424 and 080 24
24 24 24. The first layout may appear golden or silver but the
second layout could justify a platinum classification with its
4 repetitions of the same pair.
Possible
classifications for some attractive number combinations
Platinum
Anything
ending in the digits of the current year.
Numbers
ending in –999.
Attractive
0800 6-digit numbers.
Golden
Other
0800 6-digit numbers.
Formations
such as X XXX XXX (e.g. 6 666 666), X YYY YYY (4 666 666), W
XX YY ZZ (2 44 55 66), X YYY ZZZ (2 333 444)
XYY
XXXX (544 5555), XYY XZZZ (355 3888), XXX YXXX (e.g. 555 9555).
Especially
attractive alphanumeric combinations.
Silver
Other
6-digit numbers.
Numbers
ending in –100, -200, -300 or –1000, -3000, -4000,
etc. that are not platinum or golden for other reasons.
Formations
containing some repeated pairs, triples or other somewhat memorable
combinations. These might include XYY XX ZZ (e.g. 600 66 33)
or XYY ZXZX (e.g. 600 9696).
Everyday
alphanumeric combinations.
Standard
Any
other number that is specially requested.
3.
Auctions
A
pool of especially sought-after numbers might be put aside for
auction, perhaps on a monthly or quarterly basis
This
allows numbers to reach their true economic value but it may
be difficult to relate this to customer demand for near-immediate
allocation of numbers. Also, it would be necessary to have some
way to quickly identify potentially attractive numbers before
each auction.
Auctions
might also be useful as a means of allocating short (e.g. 4-digit
08XX XXXX) numbers.
One
possible approach
The
algorithm selects platinum, golden and silver numbers according
to set criteria.
Allocation
Charge
Platinum
numbers put aside for auctions. This will ensure that a market price
is achieved for these numbers. Platinum numbers need not be auctioned
immediately or at a single auction – the Driver & Vehicle
Licensing Agency release only a small part of available Classic
Registration Numbers immediately for auction and hold back the rest
for later auctions.
Pre-determined
flat rates for golden and silver numbers – operators currently
charge up to £500 for attractive numbers that are termed "golden
numbers" and up to £150 for the next level of attractive numbers,
which this paper has termed "silver" numbers. It is suggested
that, unlike platinum numbers, these numbers are always allocated
immediately.
Most
Standard numbers charged at "cost". Selected but non-attractive
numbers and numbers that clearly have value but are not picked up
by the algorithm could sensibly be charged at "cost
plus".
Alpha-numerics.
These can either be left to the "cost plus" approach or
the algorithm could be adapted to identify attractive alphanumeric
phonetic numbers as well (see the website http://www.phonetic.com
and the attached advertisement for the Personal Number Company).
There
is an argument that those companies that have already been allocated
a number should pay a lesser rate or should not have to pay an allocation
charge at all.
Annual
Rental
An
annual rental seems to be required to ensure unused numbers are
returned. This charge could either be standard for all allocations
– to reflect the cost of operating the NAO – or follow
a charge structure according to the attractiveness of the number.
Higher
charges would seem to be needed for shorter (e.g. 0800 4-digit numbers)
numbers and extra charges for reservations, including the protection
of confusingly similar numbers (if we proceed with this).
SOME
ISSUES
Should
there be a higher charge for shorter numbers, e.g. 0808 12 34 or
0800 12 34 56 being more expensive than 0808 1234567.
Should
there be a separate scale of charges for reserving a number? And
should a reservation that is not followed up by a request for full
allocation carry some deterrent charge?
Should
we appoint a consultant to develop a computerised algorithm or use
a subjective but disinterested "judge" to advise on levels
for pre-determined values, just as the DVLA decide some prices for
unusual registration numbers?
These
issues are for the working group to consider. The group may also
identify other INA issues to discuss.
Mark
Whitbread, 22.9.99
MEETING
NOTE
Time
& Place: 1:00
pm at Oftel
Meeting called
by: Oftel
Meeting chaired
by: Michael
Dixon (Telecoms consultant)
Oftel
representatives:
Alan Pridmore
Mark Whitbread
Attendees:
Isobel Brown
(FUG)
Robert Dirskovski (DMA)
Roger Gilbert (DMA)
Peter Hamilton (BT)
Liz Wainman (CA)
James Woodward-Nutt (CCE)
Karen Wray (CWC)
Alan Price (DialIt)
Lindsey Norman (ICSTIS)
Suzanne Gillies (PRA)
Michael Reade (PRA)
Sara-Jane Amey (Telewest)
Noel Scanlon (TMA)
Apologies:
David Harrington
(TMA)
Lesley Bulman (ntl)
Scope
of Work
As
laid out in the Terms of Reference (attached).
Oftel
gave brief presentations on the background to the setting up of
the Working Group and on the limits to the remit of the working
group. Oftel explained that this working group’s discussions
should focus on: how an INA charging structure might decide which
numbers attract which charges and how these might be calculated;
and the concept of attractive, coveted or golden numbers.
Oftel
pointed out that an ongoing working group was discussing the rules
of number use, including number trading, and two more working groups
would soon be convened, one to examine the organisational structure
of the individual number allocation system and one to examine charging
for number block allocations.
Main Discussion
Points
This
meeting note tries to group the comments made during the main group
discussion. Much of the discussion centred on the structure within
which INA might take place.
Some
group members saw problems with the current allocation system in
that large-block allocations prevented flexibility in allocating
only as many numbers as companies were likely to need, which tended
to waste numbers. Others disputed whether problems with inefficient
use would best be solved through trading for numbers and suggested
it might increase hoarding for speculative purposes.
Several
members of the group queried whether inefficient use of numbers
was a real concern, especially because Internet-type or another
type of non-numerical addressing seemed likely to replace numbers
in future, before non-geographical numbers neared exhaustion. Certain
group members also queried whether 09 numbers were likely to be
the subject of number hoarding or speculation in the way that Freephone
and Personal numbers might be (and possibly already are).
Other
members believed the current system allowed intrinsic inequalities
in number provision to persist. Some operators could, simply through
the luck of the draw, obtain better numbers or number blocks or
might have obtained ‘better’ blocks of numbers because
of their early entry into the market.
Several
members believed allocating individual numbers was plainly the best
direction in which to move number administration, because it would
prevent any accusation of favouritism in end-user number allocations,
which was only reduced and not completely eliminated by Pre-Allocation
Porting.
RG
suggested that for any allocation system to be seen as fair then
access to available numbers needed to be as open as possible to
end customers. While allocations through intermediaries would be
one route there was much merit in a direct-access route for obtaining
number allocations, which INA allows. It was pointed out, though,
that freer access was likely to bring higher costs, which would
probably be passed onto users.
Prior
to any expanded form of INA being introduced the effective running
of the PAP system would be key in opening up the availability of
numbers held in the block allocations currently made to Operators.
To encourage all Operators to engage in the PAP service it was proposed
that all block allocated numbers would attract an ‘in use’
charge unless they were shown as being available on the PAP database,
and thus available for use and, or porting. Operators who declined
to publish available numbers would then have to cover the cost of
not making them available.
Most
members doubted "use it or lose it" rules would reduce
inefficient use. Some of their doubts were because "use"
was difficult to define in a way that would prevent number holders
being able to give the appearance of use. Some were because issue
and/or rental charges would either be too low to discourage speculators
holding numbers inactive or be too high to allow potential new entrants
or small businesses to operate and compete fairly. It was proposed
that a definition of "use" could be based on a revenue
threshold but the group was not keen to recommend this approach,
because it seemed to disallow legitimate zero or infrequent use
of a number.
There
were mixed views on the wisdom of opening up all 080 numbers for
possible allocation.
There
was some misunderstanding of Oftel’s intentions with regard
to charging for allocations. Oftel does not wish to prevent a market
in numbers. It merely wishes to ensure that any market is run fairly
and does not cut across other regulatory requirements.
Attractive
numbers
There exist different charging rationales for so-called attractive
numbers. BT charges for "coveted" numbers, i.e. any number
that is not the next in line. Some companies do not charge at all
but are reported to use memorable numbers to attract or keep customers.
R
Gilbert suggested some lessons could be learnt from looking at the
US system of number allocation, which includes a central database,
administered by an organisation independent of the telecommunications
industry. In the US, "registered" users or user agents
can make reservations and allocations of 10-number batches direct
from the database for a per-active-number, cost-only-based fee.
It is operated on a strictly first-come-first-served basis and all
numbers must be brought into service within a short time or be returned
to the pool. Number trading is not permitted but it does happen.
R Gilbert believed this system still made many more numbers available
and pushed allocatees into making numbers available for porting.
No
special charges are made in the US system for attractive numbers.
Some
members, chiefly operators, queried how mutual interconnection between
companies that did not at present have agreements would work. They
feared setting up new agreements would be slow (usually 3 months).
The
group queried why all ranges could not be opened without moving
to full INA. Oftel explained that it would only release all numbers
when the allocation arrangements were fully transparent, open to
all and non-discriminatory.
Action Points
Oftel to arrange for representatives from Telcordia Technologies
(the company that designed the on-line INA database in the US) to
attend the next meeting of this group. This is to enable the group
to examine a working system, whether or not the same procedures
might be suitable for the UK.
Alan
Price agreed to feed back on the proportion of numbers in a typical
0800 number block that could be considered attractive.
Future meeting dates
Provisional dates for future meetings are: 2pm, Monday 25 October;
and 2pm Wednesday 24 November.
Post-meeting Note
Because of the strong interest the group showed in the INA process
structure, Oftel have decided to postpone the October meeting of
this group to make way for a consumer group workshop on the INA
structure, which will include a presentation by Telcordia Technologies
on the US experience of INA. That should then give enough background
to the structure issues for the meetings on charging for INA to
be resumed in November. Separate meetings will be arranged with
the operators through the NGNP Commercial
Group.
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