7.1 The responses to Oftel's consultations on service providers show that there are significant concerns on the part of independent service providers about the effectiveness of the current regulatory framework in dealing with anti-competitive behaviour and over charges for end-to-end network services.
7.2 Oftel considers that the best prospects for a vigorous market in services delivered over fixed telecommunication networks lie in stimulating effective competition between a wide range of market players, both network operators and independent service providers. Oftel believes that the proposals for change set out in this document will help to secure a fairer and more competitive market in such services, and a better choice for the consumer as a result. The proposals should benefit the telecommunications market as a whole by stimulating more traffic over the networks.
7.3 In particular, the proposed new charging arrangements should encourage BT to price the services it supplies to independent service providers below retail prices. Oftel expects that as a result the absolute level of prices for these services will come down and that this will lead to growth in the market for enhanced services. Second, the proposals for a clearer split of the services in BT's SB and SSB will enable the non discrimination requirement on BT to operate much more effectively than it has so far and will help ensure that independent service providers are competing on equal terms with BT's own enhanced service business (the SSB). Oftel's proposals in relation to BT's services will have other positive effects, including a clearer obligation to supply the particular services that service providers require unbundled from other services and a more appropriate treatment of data services.
7.4 The timetable for responses to this document is set out in the "Consultation" section at the front of the document and in Annex D.
7.5 Oftel seeks views on the following issues. Comments on any other aspect of the document are also welcome:
Bearing in mind Oftel's objective of promoting infrastructure competition, do respondents agree with the conclusion that independent service providers (and BT's SSB) should not be charged on the same basis as network operators for network services. (Chapter 4, Paragraphs 4.7 to 4.9)
Comments on Oftel's proposed future approach to Relevant Connectable System (RCS) status, that is, in future limiting RCS status to licensees who are network operators and International Simple Resale operators who contribute significantly to competition in the international market. (Chapter 4, Paragraphs 4.10 to 4.13)
Whether the combination of incentives on BT and current or proposed regulatory controls is likely to lead to BT introducing an independent service provider price lower than the price to end users. (Chapter 5, Paragraphs 5.5 to 5.9)
Comments on the likelihood of an independent service provider price tending towards the same level as Condition 13 charges for network operators. If so, whether this would matter. (Chapter 5, Paragraph 5.5)
Do respondents agree that, in the absence of the proposed anti-competitive practices condition, Oftel would need to consider more prescriptive powers, such as a power to determine prices, to ensure fair competition with respect to an independent service provider price.(Chapter 5 ,Paragraph 5.6)
Comments on whether BT should be encouraged to differentiate in the prices it charges for end-to-end connection services according to the different uses to which they are put by independent service providers; whether such a freedom could be policed effectively; and whether it would have beneficial economic effects or whether it could be used anti-competitively., and if the latter what are the potential risks involved. (Chapter 5, Paragraphs 5.10 to 5.13)
Views on the principles to be applied to the proposed split of the Systems Business (SB) and Supplemental Services Business (SSB) (Chapter 6, paragraph 6.3), which services should be in each (Chapter 6, paragraphs 6.5 to 6.8) and in particular, how Virtual Private Networks (VPN) and Centrex services could be separated between basic and enhanced functions in a technology neutral way. (Chapter 6, Paragraph 6.8(v))
Views on the principle and practicalities of a "Controlled Routing Service" to eliminate any excess network costs incurred by independent service providers in the provision of services that require number translation. (Chapter 6, Paragraphs 6.10 to 6.11)
Views on the appropriate accounting requirements for BT's SB and SSB if the split between them is to be effective in ensuring fair competition. (Chapter 6, Paragraphs 6.12)