OPERATOR POLICY FORUM: Thursday 15th March 2001

Contents:

1. Agenda for the meeting.

2. Minutes of the meeting.

3. Action Points from the meeting.

1.    Agenda

Item    -    Presented by:  (Oftel unless otherwise stated)

1. Introduction and Action Points - Chris Kenny

2. Alternative Dispute Resolution Procedures - Rosalind Stevens-Strohmann

3. Local Loop Unbundling - John Russell

4. Calls to Mobile Consultation Document - Vince Affleck

5. Focus Group updates:

• CPS - Caroline Wallace
• ICPS - Wendy Dodd (Worldcom)
• FRIACO (IP Interconnection) Group - Geoff Brighton
• NTS - Geoff Brighton
• Mobile Number Portability - Peter Roberts (Orange)

6. Forthcoming and Recent OFTEL Publications - Chris Kenny

7. AOB

2.    Minutes

Agenda Item 1 - Introduction and Action Points

Chris Kenny informed the meeting of an amendment to the published agenda due to the postponement by BT of their presentation on forecasting the costs of rearrangements. It would be considered if this item might be rearranged for April's OPF meeting.

Agenda Item 2 - Developing a Telecommunications Ombudsman

Rosalind Stevens-Strohmann

Presentation on Developing a Telecommunications Ombudsman:

• On 15 March Oftel published its consultation document on developing a Telecommunications Ombudsman.
  
  
• Under the Revised Voice Telephony Directive (RVTD), the Director General was required to put in place procedures to address disputes between users and their fixed line operators/service providers that are "fair, transparent, inexpensive and timely." Oftel believed that the Ombudsman scheme would meet those requirements.
  
  
• The core scheme, under which RVTD requirements would be met, would mean compulsory participation for all licensed operators and systemless service providers of fixed public telephony networks or services.
  
  
• In addition Oftel believed that a wider voluntary scheme would be in line with the expectations of the Communications White Paper and with best practice in a range of consumer service industries
  
  
• The Ombudsman would handle all relevant disputes over telephone bills and/or the terms and conditions under which telephone services were provided, up to a maximum value of £5,000.
  
  
• The core scheme would cover disputes regarding fixed voice telephony, fax and dial-up Internet access between licenced operators and/or systemless service providers providing a fixed public telephone network and/or a fixed public telephone service and users of that service
  
  
• The mechanism for funding the Ombudsman scheme should be as simple, transparent and equitable as possible. Oftel may consider recovering the costs of the core scheme through the licence fee but would prefer to consider alternatives for both the core and the voluntary scheme. There were many options which may be considered, including: splitting the costs between a general levy and a case fee, spread across all members of the scheme; or to finance all costs through a general levy; or all through case fees.
  
  
• There were also many ways in which the costs of the scheme could be apportioned between members, including: according to market share, or in accordance with the ‘member pays’ principle (ie members who have generated the most complaints would pay for a greater proportion of the costs).
  
  
• The Ombudsman Scheme should aim to treat all consumers as individuals and remove barriers that could adversely affect consumers’ ability to use the scheme, thereby ensuring equality of access for all
  
  
• The consultation period will run for three months until 15 June, followed by a Statement in July. The aim is to have an Ombudsman scheme in place by April 2002.

Agenda Item 3 - Local Loop Unbundling

John Russel (Oftel)

Update on Local Loop Unbundling

• Of the 741 sites selected from the first and second Bow Wave selection processes, initial surveys were undertaken at almost 700 sites. These showed that for the Bow Wave 2 sites, which represented operators’ top priorities, space should not be a constraint, with at least 87% of sites able to accommodate all operators who expressed an interest.
  
  
• BT has now offered operators the option of placing firm orders before a detailed design was available. This would ensure that build of such facilities proceeds immediately after detailed design was completed, provided that the cost per operator did not exceed £33,000. BT has received such commitments from operators at a number of exchanges. It was expected that the building of such facilities would begin around Easter. Oftel would announce the sites at which such facilities were being prepared as soon as build begins.
  
  
• Since December 2000 operators had been able to order distant co-location on a "business as usual" basis i.e. at whichever sites they wanted and whenever they wanted. To date BT had surveyed over 50 sites and was now sending detailed offers to operators. OFTEL would announce the sites at which facilities were being prepared as soon as firm orders were placed.
  
  
• In January 2001, Oftel announced that it was launching an own initiative investigation into the cost of physical co-location using BT’s hostel product. The aim of the investigation was to determine whether the cost elements that BT had included in the final estimate submitted to operators was reasonable. Oftel had already obtained information from BT on the basis of some of the charges and was now seeking to benchmark these prices charged by incumbents in other countries.

OFTEL was also conducting an investigation into a complaint by a number of operators alleging undue discrimination by BT in favour of its own DSL rollout.

• Recent LLU publications

• Local Loop Unbundling: The Terms of the Access Network Facilities Agreement (Statement and Determination) - February 2001

• Guidelines on the availability of co-location facilities and the use of space at MDF sites (Consultation Document) - March 2001

• Local Loop Unbundling Fact Sheet - March 2001

Discussion

Views from the Floor

The ceiling cost of £33,000 per operator for orders for space at exchanges may be exceeded with the addition of an uplift fee.

Oftel

There were no 'set in concrete' orders for space at exchanges. BT could proceed with a build of facilities if the cost of the order was £33,000 or less but costs exceeding £33,000 would not have to be accepted by operators.

Oftel was working to keep the costs to operators down and discussion on costs was still ongoing in LLU Commercial Group.

Agenda Item 4 - Calls to Mobile Consultation Document

Vince Affeck (Oftel)

Presentation on the Review on the Price Control of Calls to Mobiles consultation document

• BT Cellnet's and Vodafone's current controls, a ceiling of 11.7 pence per minute for 1999/2000 with subsequent reductions of RPI-9% for the years 2000/01 and 2001/02, were put in place after Oftel referred of the matter to the Competition Commission. The current controls have saved consumers in excess of £1 billion over three years.

• There has been a substantial growth of calls to mobiles since 1996/1997 and the mobile market as a whole has grown rapidly and at a rate much greater than that predicted by the Competition Commission since the current controls on calls to mobiles were set.

• The present controls were due to expire in March 2002, and the purpose of the consultative document - Review on the Price Control of Calls to Mobiles -is to seek views on whether the controls should be continued or removed, or if some other regulatory action was appropriate. Proposal's on BT's retention rates for calls to mobiles were covered in the February 2001 Price Control Statement.

• A major factor to take into consideration when assessing the intensity of competition was the fact that the price of the call to a mobile is paid by the person making the call, not the person receiving that call. For that call, the person making the call has no direct relationship with the mobile operator on whose network the call terminated. This factor, known as the calling party pays principle, was discussed first.

• Oftel’s effective competition review guidelines, entitled Implementing Oftel’s Strategy: Effective Competition Review Guidelines, set out four broad groups of the indicators of effective competition: consumer outcomes, consumer behaviour, structural factors and supplier behaviour. The calls to mobiles review took into account all these indicators.

• Oftel would be continuing work to model the LRIC of mobile voice termination. This work was being carried out in discussion with the operators with the support of analysis

• Oftel proposed to insert a ‘rollover’ condition into BTCellnet’s and Vodafone’s licences which would allow the existing controls to continue for the duration in the event of any reference to the CC and until new arrangements, if appropriate, were in place.

Agenda Item 5 - Focus Group updates

CPS

Caroline Wallace (Oftel) reported on behalf of the Focus Group:

Commercial Group

Met 28/02/01

Oftel has proposed statistics for operators to include in the quarterly returns, still under discussion. Operators have always been concerned at the perceived constraints imposed by the transaction forecasting process, either the financial penalties for over-forecasting or operational difficulties of under-forecasting. BT has proposed a mechanism for transaction trading which is under discussion. There is still plenty of work to be done for December 2001 launch of Phase 2.

Triallists Group

Met 13/02/01, 13/03/01

Phase 1 trial and pilot has now been finally closed. Triallists for Featurenet functionality and Phase 2 are still to be agreed. There is a meeting on 10/04/01 at Oftel where triallists should be selected. At present there is only one volunteer operator for the Featurenet trial and BT is reviewing whether this would be sufficient.

Process Group

Met 27/02/01

Meeting 3-weekly. There are concerns about the amount of work to be completed in time for December 2001 launch for Phase 2. The group is agreeing the workstack with BT. Operators have been asked to review their representation at Process group and its working group offshoots to ensure that appropriate personnel are able to attend (regulatory/legal are not always the most useful!). There should be a new issue of the End to End Process document in about 4 weeks time.

Process Improvement Group

Met 27/02/01

Group decision making processes were discussed. Looking at possible ways of reducing cooling-off period with retention of reply slip.

Consumer Group

Met 21/02/01

Discussion centred on the length of the ‘cooling-off’ period and ongoing need for a ‘reply card’, the questions coming from the Process Improvement Group.

Costs Sub-Group

Has not met.

Oftel has commenced discussions with BT on costs for Featurenet order handling, looks likely to comprise a per site and per CLI charge. Notice of proposed determination out soon. ppm ‘surcharge’ will be subject to consultation later in the year.

All groups have reviewed their Terms of Reference.

ICPS

Wendy Dodd (Worldcom) reported on behalf of the ICPS Focus Group:

FRIACO (IP Interconnection Group)

Geoff Brighton (Oftel) reported on behalf of the FRIACO (IP Interconnection Group)

Stage 2 Working Group

The first Stage 2 Working Group was held on 9 March and had been constructive. Two more meetings had been scheduled for 30 March and 20 April, both at 10:00am here. This issue concerned all operators and anyone who wished to attend was welcome.

IP Interconnection Group

The inaugural IP Interconnection Group was held on 29 January at which Oftel defined what it viewed as true IP Interconnection. This aimed to achieve handover of Friaco originated traffic as IP at the tandem switch (or if required the DLE) and was dubbed Friaco 3. It did not include narrowband modem co-location. Oftel proposed to manage the work at two levels namely a series of plenary meetings to which anyone could attend and ad hoc meetings with operators to discuss the detail. The first of these was held on 1 March. Further meetings are currently planned for 29 March with operators and 4 April for the main group.

Modem Collocation

Condition 83 only requires collocation for LLU any extension of this to such as narrowband modems would require full public consultation under the ICD or non-discrimination provisions. Oftel could see no technical imperative for collocation or why operators would want to use very expensive BT buildings when there are much cheaper alternatives they could create for themselves. For Oftel to be able to assess the need for this operators were required to write in to explain their reasoned case ie:

• Why they believe collocation is necessary;
• Why alternative or substitute arrangements are not adequate;
• What damage would be done in the absence of collocation.

Written submissions should be made to Geoff Brighton by 12 April 2001.

AP 03/1

DLE to ST Overflow arrangements and 64k Granularity

In the responses to the ST Friaco consultation a number of operators talked about the need for overflow between DLE and ST routes to enable them to better manage traffic demand. In addition some talked about the need to be able to reduce the number of 64k channels within 2Mbit/s routes was also viewed as desirable to reduce costs incurred through having to buy a minimum of 2 or 3 routes at each DLE.

Oftel would be holding a workshop to progress these issues. In the meantime Oftel would like to see some real proposals for how overflow would work including dimensioning rules and the management of excessive peaks. Responses should be sent to Geoff Brighton as soon as possible so that this work can commence.

AP 03/2

Guidance on Re-arrangements – Consultation

Comments were due by 15 March with comments on comments by 29^th March. Physical copies of comments received by 15 March would be available in Oftel's R&I Unit from 16 March 2001.

Review of Charges

The original DLE Friaco Direction stated that Oftel would review the Friaco charges based on real traffic by December 2000. This review has not taken place and was now expected to do so soon after June 2001.

NTS

Geoff Brighton (Oftel) reported on behalf of the NTS Focus Group:

The NTS Focus Group would be recalled shortly –members would be notified of the time and date shortly. Topics would include:

• Transit – to ensure everyone understands how this should work ie as I described at the December OPF.
• INCA – any issues – Oftel is not aware of any but this may be because few INCA bills have been generated yet.
• NTS Discounts – ability of operators to opt out. Oftel has no formal view at this stage but has received initial representations from operators and BT.
• Anything else operators notify before the meeting – please advise me asap.

The retail uplift work has resumed and it is hoped that Oftel will put initial conclusions to BT shortly. This may require further meetings between Oftel and BT before the focus group would be briefed and the industry consulted.

Outstanding Directions

• NTS Links – this was being finalised with Oftel lawyers having taken into account Friaco. A Draft was expected to be issued shortly.
• ONO specific charges – The final Direction in the BT / C&W case would also be published shortly. Oftel also received a referral from Telewest and was considering the representations.
• NTS Discounts – Oftel was nearing a position on which to discuss its views on BT’s discount figures with BT. However, a draft direction may still be a few weeks away.
• Rejection of INCA Billing – it appeared the main reasons given for rejecting this were lack of transparency and confidence that INCA worked and because BT included its revised discount figures in the proposal. Oftel's hope was to be able to issue a draft for consultation fairly soon.

Rejection of NTS Pricing letters

BT has advised of an error in the proposal rejected by operators. Oftel was waiting to hear how BT plans to manage this before proceeding with the determination.

Ad hoc issue

A company is advertising, on the Internet, free 0870 numbers to personal and business consumers for which they made terminating payments of between 0.75 and 1.2 ppm depending on volume. Whilst there was nothing in the NTS rules to prevent this, and it may be nothing new, Oftel suspected this may have the potential for fraud by users making long calls to their own number from other fixed lines. Any views on whether the OPF in general should be concerned should be made to Geoff Brighton at Oftel.

Geographic & Non Geographic Number Portability

Report was circulated

Mobile Number Portability

MNP2 Project activity

• The contract between the web system vendor and the four mobile network operators has been signed
• Public launch of MNP2 on 30 September 2001 is confirmed.
• Review of the Press Release would take place at the next Focus Group Meeting on 3 April

Agenda Item 6 - Publications

Chris Kenny advised the Forum of the following forthcoming Oftel publications:

• Oftel Management Plan 2001/2002 (statement)
• Access codes (statement)
• Review of the Telephone Equipment Direction (statement)
• Open Access (statement)
• Final determination of price for shared loops
• Updated LLU guidelines
• Oftel's Welsh Language Scheme (statement)
• Number Portability Functional Specification
• Mobile Number portability (statement)
• Personal Numbering (consultation)

Agenda Item 7 - AOB

International Issues

Vincent Affleck (Oftel)

In the March 2000 Statement on Competition in International Markets, Oftel proposed that BT’s network charge publication notice period be reduced from 28 days to one day for the 26 wholesale international routes. Concert has now made a representation to Oftel requesting that this reduction should be extended to all IDD routes.

In response to the representation from Concert, Oftel would carry out a Market Review of both residential and business markets and consult on proposals.

New Numbering Application Forms

Views from the floor

Concern about the lack of consultation prior to implementation of the forms.

Question 13 of the form is unworkable

Oftel

The new forms were revised to ensure that only eligible operators apply for allocations and reservations of numbering capacity; number ranges are allocated on a fair and reasonable basis (for example, to take into consideration Conservation areas); and to ensure that operators receive number allocations in a timely manner. However, perhaps some 'road testing' of the forms should have been considered and Oftel would now look into organising a special meeting with operators to look at the forms. Thought would also be given to whether operators can carry on using the old forms whilst concerns were addressed. Operators' concerns were noted.

AP 03/3

Next meeting

The next meeting will take place on Thursday 26 April at 2:30 pm

3.   Action Points

ACTION POINTS: OPF - 15 MARCH 2001