Contents

Summary

Chapter 1 – Introduction

Chapter 2 – Responses to initial consultation and Oftel comments

Chapter 3 – Further consultation and questions

Chapter 4 – Consultation process

Annex A – Proposed modification to Functional Specification for CPS

Summary

S.1 In December 2001 Oftel issued a consultation document on a proposal to include the existing directory enquiries (DQ) codes 192 and 153 within the Carrier Pre-Selection (CPS) Functional Specification. Specifically, these codes were to be included within the 'all calls' CPS option. However, Oftel's view put forward in the paper was that the codes should not be included within 'all calls'.

S.2 At present, a CPS customer who has the CPS 'all calls' option will still have their calls to 192 and 153 routed to, and billed by, BT. The inclusion of these codes within the CPS Functional Specification would mean that, when a customer dialled 192, it would be routed to the CPS operator's network instead of BT.

S.3 Oftel received four responses to the consultation. Two responses were broadly in favour of Oftel’s view and two were opposed to it. Oftel also received one set of ‘comments on comments’ following the consultation.

S.4 After considering the responses to the consultation, Oftel remains of the view that there will be limited benefit in including 192 within ‘all calls’. Oftel is however in the process of liberalising the DQ market in the UK by introducing a new range of six digit numbers starting with 118 for DQ services. As detailed below, Oftel believes there is a more substantial case for including the new DQ codes, 118XXX, within ‘all calls’.

S.5 In Oftel’s December 2001 consultation, Oftel explicitly excluded the new 118XXX numbers from the scope of the consultation. This was because, at the time, Oftel believed that competition in the new 118XXX arena might be negatively affected by including 118XXX within 'all calls'.

S.6 Having considered the matter further, Oftel is of the view that inclusion of 118XXX might be in the consumer's long-term interest and seeks the views of stakeholders on this proposal. This is because Oftel believes there may only be a limited risk of a negative impact upon the development of competition in the DQ arena by the inclusion of 118XXX within CPS. Oftel will particularly welcome the views of stakeholders with regards to this as, in Oftel’s view, it is a fundamental consideration.

S.7 Before making a change to the CPS Functional Specification, Oftel is required to consult on the proposed changes. However, Oftel would not ordinarily consult on the inclusion of a new number range (such as 118XXX) within CPS, as Oftel has taken the view that the default position is that new number ranges are included by default within the ‘all calls’ option. In this case however, Oftel has taken the view that, because historically DQ calls have been excluded from the Functional Specification, a further consultation would help in bringing clarity and forming the final policy.

S.8 In the absence of a modification to the CPS Functional Specification in time for the launch of the new 118XXX codes, Oftel’s view is that 118XXX should not be included in the ‘all calls’ option at the outset. This is because of Oftel's previous view (as expressed in Oftel’s December 2001 consultation and now subject to review) that 118XXX would not be expected to be included within 'all calls'.

S.9 Following a request from the industry, the consultation also addressed an administrative issue to do with the option numbering format used in the Functional Specification. As a result of discussions during and after the consultation, Oftel will not be changing the numbering format as the industry agreed that such a change would not be beneficial.

Chapter 1 – Introduction

1.1 This document is a statement following Oftel’s December 2001 Consultation on proposed inclusion of Directory Enquiries within the Carrier Pre-Selection 'all calls' option and a further consultation on the possible inclusion of 118XXX codes within the CPS Functional Specification.

1.2 The CPS Functional Specification is a document referred to in the Telecommunications Act Licences of BT and Kingston Communications. It specifies technical and other principles to enable the efficient implementation and utilisation of CPS in the UK. It is published by Oftel from time to time after consultation with the Licensees and other interested parties.

1.3 Within this document all references to 192 should be taken to include a reference to 192 and 153 unless otherwise stated.

Carrier Pre-Selection background

1.4 Customers on BT's network can, at present, use alternative carriers by dialling three-, four-or five-digit access codes. These codes allow the calls to be routed to the carrier of their choice. This system is known as indirect access, and it requires customers always to dial the extra digits to use an alternative carrier. This process can be automated when a customer has special dialling equipment, called an autodialler.

1.5 CPS is a mechanism which allows users to select alternative operators in advance without dialling additional codes on the telephone. The customer subscribes to the services of one or more alternative operators and chooses the type of calls (eg all national calls) that will be routed through the alternative operator.

1.6 EC Directive 98/61/EC (the Amending Interconnection Directive) required CPS to be made available throughout the European Community from 1 January 2000. In the UK, the Director General of Telecommunications has determined that BT and Kingston Communications Ltd (KCL) have Significant Market Power (SMP) in fixed telephony. Thus they are required, under the Directive, to provide CPS.

1.7 For further background information on CPS, please see Oftel’s website at www.oftel.gov.uk/ind_info/network_inter/cps_icps.htm.

Call options

1.8 There are three types of call option under CPS, these are:

• national calls (this does not include local calls, international calls, calls to mobiles or calls to non-geographic numbers including the ‘national rate’ 0870 range);
• international calls (calls to the Republic of Ireland and overseas); and
• ‘all calls’ (including international, national, local, mobile, non-geographic – eg freephone, local rate, national rate, premium rate, personal and paging).

1.9 A user can have both the national and international options at the same time, either from the same provider or from two different providers. The ‘all calls’ option cannot be combined with any other option.

1.10 At present, CPS does not apply to calls using Type A short codes (eg 100, 999, 112, 192), Type C (operator specific) short codes or the 0844 04yyxxx and 0808 99yyxxx number ranges used for unmetered Internet access.

1.11 Oftel decided not to include 192 within CPS at the outset as the future of 192 was uncertain. Until Oftel had reached its final decision following its consultation on DQ access codes any moves to alter the status of existing access codes would have been premature and may have pre-empted full consideration of all the possible DQ options.

1.12 For further information on Type A and Type C short codes, please see Oftel’s document Access codes: options for the future use and proposals to revise access codes and short codes conventions at www.oftel.gov.uk/publications/numbering/acco0301.htm.

Oftel’s directory enquiries decision

1.13 At present, consumers are only able to use the DQ service provided by their network operator. This is typically done through the 192 code (for national DQ) or 153 (for international DQ). Independent DQ service providers would like to offer their services in competition with the existing network operators. However, there are not enough short codes to go around all interested parties. Therefore independent DQ service providers have had to use longer numbers.

1.14 In November 2000, Oftel consulted on possible changes to the access codes used for DQ services. The consultation document Access codes for directory enquiry services: Consultation document issued by the Director General of Telecommunications is available online at www.oftel.gov.uk/publications/numbering/dqs1100.htm.

1.15 In September 2001 Oftel published its statement on the outcome of that consultation. Access codes for directory enquiry services: A statement issued by the Director General of Telecommunications is also available online at www.oftel.gov.uk/publications/numbering/denq0901.htm.

1.16 The statement set out Oftel’s proposals for the future of directory enquiry services. Oftel concluded that a model of service-based competition, with all operators and service providers on an equal footing will provide the best deal for the consumer in terms of price, quality and choice of service. To implement this, Oftel has introduced a new range of 'type B' access codes, 118XXX, for access to DQ services. Access codes in the new range have been allocated to individual DQ service providers (including network operators and independent service providers).

1.17 According to the industry project plan for the implementation of 118XXX codes, the first services are likely to go live in the last quarter of 2002. The old DQ access codes (such as 192 and153 as well as codes not used on BT's network like 142) are scheduled to be withdrawn in August 2003. For further information on the changes to DQ, please see Oftel’s website at www.oftel.gov.uk/ind_groups/dq_group/index.htm.

Changes to the CPS Functional Specification

1.18 Oftel considers that the CPS Functional Specification explicitly states which types of call are to be excluded from the CPS ‘all calls’ option, and does not therefore attempt to explicitly list all the different types of call which are included in the ‘all calls’ option. Therefore, new numbering ranges that are not explicitly excluded are in fact included in the ‘all calls’ option. However, because directory enquiry calls have thus far been excluded from ‘all calls’, Oftel believes it is appropriate to consult on their future inclusion even though they will operate on a new number range.

195 for blind or otherwise disabled customers

1.19 The 195 code is used to provide free DQ services for those customers who are blind or otherwise disabled so as to not be able to use a conventional paper directory. 195 is a replacement for paper directories (which are supplied, for BT customers, as part of their line rental) and is not a replacement for regular voice DQ services even though they may be provided in an identical way save for the code dialled. Because of this direct relationship with the access operator’s paper directories, Oftel is not proposing to include 195 with the CPS ‘all calls’ option and will expect those access operators providing CPS to other licensed operators (only BT at present) to continue to provide the free 195 service to blind or otherwise disabled customers.

Chapter 2 – Responses to initial consultation and Oftel comments

2.1 Oftel received four responses to its consultation, and one further response during the ‘comments on comments’ period.

2.2 BT and the Scottish Advisory Committee on Telecommunications (SACOT) broadly agreed with Oftel’s view that 192 not be included within ‘all calls’. BT also suggested that there are a number of additional arguments which supported its continued exclusion. A joint industry response from CPS operators (the ‘CPS industry response’) and a separate response from Centrica (who also contributed to the joint CPS industry response) were both strongly opposed to the exclusion of 192 from ‘all calls’ and also argued that 118XXX codes should be included in ‘all calls’ as well.

2.3 Below is a summary of the responses (full responses are available online at www.oftel.gov.uk) and Oftel’s response to specific points raised.

BT

2.4 BT broadly agreed with the reasoning behind Oftel’s proposal not to include 192 within ‘all calls’, however BT did advance a number of other arguments against the proposal which are summarised below.

Incompatibility with the Interconnection directive

2.5 BT argued that the inclusion of services such as DQ within CPS was not within the scope of the Interconnection directive (98/61/EC). BT argued that this is because DQ is an 'information' rather than a 'switched' service.

2.6 Oftel disagrees with this position. A large number of information type services operate behind premium rate numbers and these are included within CPS ‘all calls’. Oftel considers that the directive does allow DQ calls to be subject to CPS.

Consumers must have access to a DQ service

2.7 BT voiced concern that inclusion of DQ within CPS ‘all calls’ could jeopardise the right of all subscribers to have access to a DQ service as is required under EC directive 98/10/EC (Directive on the Application of Open Network Provision to Voice Telephony and on Universal Service for Telecommunications in a Competitive Environment).

2.8 Oftel agrees that subscribers must have access to a DQ service, however, Oftel does not share BT's view that inclusion of DQ within CPS ‘all calls’ would jeopardise this. This is especially true if, as Oftel proposes, 118XXX calls are included within ‘all calls’. There is no indication that any CPS operator would not want to carry at least one DQ code – indeed Oftel’s expectation is that they will want to offer as wide a range of services as possible and Oftel would welcome confirmation from CPS operators that they do plan to open their networks to a number of competing DQ services so as to provide their customers with the full benefits of competition.

2.9 Oftel made it clear in its September 2001 DQ statement that it expected ‘the industry to come to equitable arrangements that will allow access to all DQ services on all networks’. Oftel also made it clear that this expectation applied to both fixed and mobile networks. Oftel would like to make it clear that it would likewise expect that, if 118XXX codes were included in the CPS ‘all calls’ option, CPS operators must make a range of DQ codes (apart from their own) available to their customers. However, in order not to create an undue burden on CPS operators or DQ service providers in relation to negotiation of large numbers of contracts, it may not be reasonable to expect CPS operators to make all 118XXX DQ codes available on their networks. If a DQ service provider did wish to be available on a CPSO's network, Oftel would expect that both parties would undertake reasonable negotiations.

2.10 In the context of access to DQ services, it is worth pointing out that all CPS customers can over-ride their CPS service at any point by dialling an ‘over-ride’ code (for example, to over-ride back to BT, the customer would need to dial 1280 before the number they wish to call). Thus if there were any problems with a CPSO’s DQ service or services, the customer would still have access to BT’s DQ service.

2.11 Finally, by keeping 192 outside ‘all calls’, the impact upon consumers of any possible delay in the implementation of 118XXX on a CPSO’s network will be minimised as consumers will still have the option of 192 and BT’s service (during the parallel running period between the new 118XXX services and the withdrawal of 192).

Oftel’s previous paper on operator assistance and CPS

2.12 BT noted that a previous Oftel paper (circulated to the CPS industry in June 2000) had appeared to state that type-A codes (including 999, operator assistance and DQ) should be excluded from CPS. BT appeared to suggest that, with consideration being given to 192's inclusion within 'all calls', Oftel was now considering including all type-A codes within CPS.

2.13 Oftel is surprised by the conclusion drawn as that paper clearly stated that the issue of DQ within CPS would form part of the content of a forthcoming consultation on the future of DQ codes. With respect to other type-A codes such as 999 (emergency service) and 100 (operator services) Oftel believes there are compelling reasons for their continued exclusion from CPS as identified in the June 2000 paper. Oftel did not suggest at any point that all type-A codes should be included within CPS.

Lack of a CBA

2.14 BT expressed concern that no cost benefit analysis (CBA) had been taken into account in formulating the proposal to include 192 within the ‘all calls’ option, especially given the limited remaining life of the 192 service.

2.15 Oftel does not believe a full, separate CBA is necessary in this area (ie DQ codes within CPS 'all calls') because of a previous CBA (see below), the relatively low level of costs involved and the speculative nature of several key inputs into any CBA (for example, consumer dialling patterns during the 192/118XXX parallel running period). However as stated previously, Oftel is of the view that the limited remaining life-span of 192 suggests the benefits of including 192 in ‘all calls’ will be minimal.

2.16 Oftel's initial DQ consultation (in November 2000) included publication of a CBA which did actually investigate the issue of DQ and CPS (undertaken in 1999). This suggested that including 192 within the CPS ‘all calls’ option "could be implemented at negligible costs as part of the long-term CPS implementation and, at the same time, has the potential to significantly increase competition in DQ services" (see www.oftel.gov.uk/publications/numbering/dqs1100.htm).

2.17 BT argued that the cost of introducing 192 & 153 into CPS would amount to some Ł200,000 in total. Oftel notes that this figure is significantly higher than previous (BT) estimates. Even with a lower figure, Oftel is still of the view that there is unlikely to be any significant over-all benefit for the remaining lifespan of 192 & 153. However, Oftel does believe that introducing 118XXX into ‘all calls’ will have a much longer term impact and positive effect.

2.18 Oftel would welcome further comment from industry on the likely cost of introducing 118XXX within ‘all calls’.

2.19 BT also questioned the validity of some of the arguments put forward in favour of including 192 within ‘all calls’ in the consultation document.

2.20 In particular BT did not agree with the notion that consumers who did not use the new 118XXX codes or add an IA code before dialling 192 would benefit from the CPSO’s choice of DQ service.

2.21 Oftel does not fully agree with this position. Oftel is committed to 118XXX as the key to liberalisation of UK DQ services, and believes this approach will have the most beneficial impact upon consumers. However, this in itself does not mean that there would be no benefit to consumers in including 192 within ‘all calls’. On the other hand (and as stated elsewhere) Oftel has not seen compelling data to advance the view that consumers would significantly benefit from the inclusion of 192 within ‘all calls’. Therefore, given the limited remaining lifespan of 192, Oftel will not be introducing 192 into ‘all calls’.

2.22 BT also expressed concern that requiring CPSOs to provide DQ might act as a barrier to entry by CPS operators and be detrimental to the development of CPS-based competition. Oftel has not received any comments from CPSOs that confirm this line of argument, however Oftel is specifically asking a question in the consultation attached to this statement about whether expecting CPSOs to provide a range of 118XXX DQ services is reasonable. Furthermore, Oftel considers that there are at least some incentives on CPSOs to provide access to DQ services, in order not to adversely affect the customer’s perception of the CPSO’s service.

2.23 BT was concerned that the possible inclusion of 192 within ‘all calls’ might lead to existing CPS customers being switched between DQ service providers without their consent as they (customers) had previously been with BT for their DQ service.

2.24 Oftel thinks this concern is probably somewhat exaggerated. Oftel would expect that CPSOs would wish to communicate any such change to their customers. Furthermore the relatively limited number and low cost of DQ calls made by the average customer would be unlikely to result in significant consumer concern – indeed it could equally be argued that many consumers when signing up for CPS ‘all calls’ are under the impression that DQ calls are included anyway.

2.25 BT agreed with Oftel’s concern that the consumer awareness necessary during the switch to 118XXX could become diluted if 192 where in CPS ‘all calls’ whilst 118XXX was not.

2.25 After further consideration, Oftel is of the view that there may actually be benefits (with respect to consumer awareness) in including 118XXX within ‘all calls’ even if 192 is not included. In particular, Oftel believes it will act as an incentive upon CPSOs to help the DQ industry promote the new 118XXX arrangements.

Joint CPS/Industry

2.26 One of the fundamental concerns of the joint CPSO response was that the lack of inclusion of 192 (and 118XXX) in ‘all calls’ might serve to significantly weaken the appeal of the ‘all calls’ option from both an industry and consumer perspective.

2.27 Given the short remaining lifespan of 192, Oftel does not believe this to be true and has received very limited evidence to support the argument. Furthermore, given that Oftel is now proposing to include 118XXX within ‘all calls’ Oftel believes CPSOs will have a clear incentive to persuade their customers to switch to 118XXX.

2.28 Oftel recognises that not including 192 within ‘all calls’ might surprise some consumers. However, given that 192 is already excluded (and this is explained in Oftel’s consumer guide to CPS) Oftel maintains that it might also be confusing for existing CPS customers to now include 192 within ‘all calls’. In either case, there is likely to be some degree of consumer confusion. By not including 192 within ‘all calls’ but including 118XXX, Oftel believes there will be less confusion as industry players will have an incentive to advise customers of the changes and will seek to move away from the old 192 & 153 regime.

2.29 CPSOs were concerned that Oftel was proposing to modify the Functional Specification to specifically exclude 118XXX without consulting on the proposal. As detailed elsewhere in this document, Oftel is now seeking to consult on a proposal to include 118XXX within CPS and trusts this will address this concern.

2.30 CPSOs argue that the exclusion of 192 from CPS ‘all calls’ and notably Interim CPS (ICPS) (see note one below) ‘all calls’ has the effect of transferring revenue from CPSOs to BT in the case of those customers who were previously using indirect access (IA). Oftel accepts that, under IA, an operator could choose to route 192 calls to itself (it could also leave them to BT or not connect them at all). However, both switch-based CPS and ICPS provide significant benefits over IA. Under switch-based CPS there is no ‘call leakage’ and no need to send out costly autodiallers, under ICPS there was a payment from BT to ICPSO for the autodialler – Oftel considers that these financial incentives far outweigh any lost revenue due to 192 been excluded from the ‘all calls’ option. The very limited evidence provided by CPSOs to back up this ‘lost revenue’ argument has not persuaded Oftel that such revenues could reasonably be material to decisions about whether or not to use either interim or switch-based CPS.

2.31 For reference, the following data about the size of the fixed DQ call market in the UK is taken from Oftel’s most recently published figures (covering the third quarter of the 2001/2 financial year):

Centrica

2.32 Like the joint CPS industry response, Centrica argued that there is a negative impact upon the CPS product by DQ exclusion. Centrica considered that the CPS proposition is weakened commercially for the CPSO and also for the consumer.

2.33 Oftel has seen no evidence to demonstrate any substantial effect (in excluding DQ from the ‘all calls’ option). Oftel has not received any complaints from consumers about the exclusion of DQ from ‘all calls’ (despite there being some ľ million ICPS and CPS customers). Oftel received very limited information from CPSOs about the impact of DQ exclusion on their businesses. Such information as Oftel did receive failed to normalise DQ revenues by total revenues, thus making it impossible for Oftel to work out the relative importance of ‘lost’ DQ revenues. Oftel’s own market information (presented in the table in the previous section) has led Oftel to conclude that excluding DQ from the ‘all calls’ option could not reasonably be expected to have a material impact on the CPS product.

2.34 However, Oftel does agree that, provided there is no compelling reason otherwise, 118XXX DQ services would in future be expected to be included in the ‘all calls’ option (as explained above, 192 was excluded from the ‘all calls’ option in the past to avoid pre-judging Oftel’s consultation on the liberalisation of DQ services. Now that Oftel’s DQ liberalisation policy has been established, Oftel is of the view that 192 should continue to be excluded from the ‘all calls’ option due to its limited remaining lifespan).

2.35 Centrica suggested that by not including 118XXX within CPS, CPSOs might be discouraged from working with 118XXX. Oftel recognises this and, indeed, one of the principal reasons why Oftel is now considering including 118XXX within ‘all calls’ is to encourage CPSOs to work with 118XXX.

2.36 Centrica disagreed with Oftel’s assertion that consumers might start migrating to the new access codes earlier than would be expected under other number changes (in Oftel’s view this was because of the volume of advertising of 118XXX services that might occur). Centrica questioned why Oftel sought to remove 192 at all if consumers where willing to take up the new codes.

2.37 Oftel maintains that more consumers are likely to migrate to the new access codes for DQ early on than would do so under a normal number change. However, not all consumers will do so. To keep 192 would therefore maintain the traditional advantage that all network operators have enjoyed in the provision of DQ. Furthermore, were Oftel not to withdraw 192, it is likely that far fewer DQ service providers would have sought to enter the market in the first place.

2.38 Centrica also expressed concern that Oftel’s proposal to not include 192 within ‘all calls’ would be contrary to Oftel’s work (and subsequent announcement) with respect to a wholesale line rental (WLR) product. Oftel believes the two products are separate and does not consider that the inclusion or otherwise of either 192 or 118XXX in ‘all calls’ CPS has any substantive bearing on the wholesale line rental product. The WLR product relates to the retail relationship between service providers and end-users, and will enable service providers to issue a single bill to end-users for both line rental and calls. Whether or not the calls are conveyed by BT, an alternative network operator or several alternative network operators (by means of CPS) will be a matter for the service provider to decide, and will be invisible to end-users. If 192 or 118XXX services are excluded from the ‘all calls’ CPS option, this will simply mean that these calls will be conveyed by BT. Given the small fraction of total calls and revenues represented by DQ services (see data presented above), Oftel does not consider that the exclusion of 192 (or 118XXX) services from CPS could have any material bearing on whether or not a service provider wishes to use the WLR product (and end-users will not be aware of any difference).

2.39 However, Oftel would like to take this opportunity to point out (for the avoidance of doubt) that, just as Oftel expects all access operators to make all 118XXX DQ codes available on their networks, if CPS over-ride using 1280 (ie back to BT) is not available with WLR then Oftel will expect WLR service providers to make all 118XXX DQ codes available to their customers. Therefore, a WLR provider who wanted to use CPS 'all calls' to carry its customer's traffic will need to make sure that they use a CPS provider who offers the full range of 118XXX codes.

2.40 Centrica also submitted a response during the ‘comments on comments’ period. This response sought to challenge many of the points raised by BT in their response to the consultation. The key points and Oftel's views on them are summarised below.

2.41 Centrica disagreed with BT’s view that DQ services are not ‘switched’ services and that the inclusion of DQ within 'all calls' might risk some subscribers’ right to a DQ service.

2.42 As stated earlier, Oftel is of the view that the inclusion of DQ within CPS is not contrary to the intention of the Amending Directive (98/61/EC). Oftel also believes that no CPS 'all calls' customer should be without access to a DQ service and does not believe that the inclusion of 192 or 118XXX within 'all calls' would have this effect.

2.43 Centrica also questioned BT's comments with respect to an industry paper issued by Oftel in June 2000, regarding the non-inclusion of type-A codes within CPS. Again, as highlighted above, Oftel is of the view that this paper specifically mentioned the then-imminent consultation on DQ and made no definitive judgement as to the inclusion or otherwise of 192 or DQ codes more generally.

2.44 Centrica did not agree with BT's assertion that the inclusion of DQ within CPS would contradict the sprit of Oftel's decision to liberalise DQ. Centrica believes that CPSOs would be willing to offer a range of DQ services on their own networks.

2.45 Oftel's view is that, in principle, including the new DQ codes within 'all calls' would not be against the spirit of the earlier decision to open up a new range of 118XXX access codes for DQ services. However, as highlighted in the next chapter, Oftel does have concerns as to how many 118XXX codes will be available to CPS ‘all calls’ consumers and this will be a key consideration in reaching a final decision on whether or not 118XXX should be included in the ‘all calls’ option.

2.46 Centrica argued that including DQ within CPS would not be a barrier to entry for new CPSOs. As discussed earlier, Oftel has not received any comments from CPSOs that back up BT’s claim that such an arrangement would be a barrier to entry for CPSOs. However, Oftel is asking a question in the attached consultation about whether it is reasonable to expect CPSOs (and DQ service providers) to negotiate arrangements to allow CPSOs to provide access to a range of DQ services (other than their own).

2.47 Centrica also disagreed with BT's views on the impact of any confusion caused by the inclusion or otherwise of 192 within CPS.

2.48 Oftel recognises that this is a difficult area to pre-judge, there is likely to be a level of confusion no matter which option is taken. As detailed elsewhere in this document, Oftel is of the view that including 118XXX within 'all calls' is unlikely to be particularly problematic or confusing for consumers, whilst to move 192 for a short period to 'all calls' (before its withdrawal) may cause some confusion, especially for existing CPS ‘all calls’ customers.

2.49 Centrica argued that DQ within CPS would be justifiable from a CBA perspective, due to the level of DQ revenues in comparison with the cost of building 192 within CPS. Oftel's view is that there would only be limited benefits in including 192 temporarily within CPS due to the limited lifespan of 192 and would prefer to see 118XXX included in the 'all calls' option as this is clearly a long-term solution.

Other responses

2.50 The only consumer group (the Scottish Advisory Committee on Telecommunications) to respond to the consultation agreed with Oftel's view that there where unlikely to be any readily identifiable benefits in the temporary inclusion of DQ 192 within CPS. Oftel would welcome the views of consumer groups on the further questions in this consultation.

Oftel summary

2.51 Oftel believes there is no clear, compelling case for the inclusion of 192 within ‘all calls’; this is principally because of the limited time remaining for 192.

2.52 However, Oftel does recognise that as a general principle there appears to be little to justify excluding DQ calls (using 118XXX codes) from ‘all calls’. Therefore, Oftel is proposing to include the new 118XXX codes within ‘all calls’ providing this does not have a negative impact upon the development of competition in DQ services (see next chapter). This will address the concerns of CPS operators about the reduced commercial and consumer appeal of the ‘all calls’ option without DQ. Furthermore, the inclusion of 118XXX, rather than 192, will help to address the concerns voiced by BT about the limited utility in introducing DQ to ‘all calls’ for a limited period.

Notes:

1. A form of CPS provided by autodiallers rather than local exchanges. See www.oftel.gov.uk for further information.

Chapter 3 – Further consultation

3.1 As previously detailed, Oftel does not believe there would be any significant benefits to consumers in including 192 within ‘all calls’. 192 only has a limited remaining lifespan and there would be a level of consumer re-education required to explain the changes to existing CPS users.

3.2 However, the new 118XXX codes will be the range used for DQ services for the medium to long term. Oftel does not disagree in principle with 118XXX codes being included within ‘all calls’. Indeed, in general Oftel would assume that all number ranges should be in the CPS ‘all calls’ option unless there are compelling reasons why not (for example, the 0844 04yyxxx and 0808 99yyxxx number ranges used for unmetered Internet access are excluded from CPS for reasons of network integrity). There are a number of issues that are of particular concern with 118XXX and these are detailed below.

3.3 The first concern is that some consumers might not be able to access (at least one) DQ service if their CPSO did not provide access to one.

3.4 As stated earlier, CPSOs have (to a certain extent) an incentive to provide DQ services for revenue and consumer perception reasons. New entrant DQ service providers will be heavily promoting their 118XXX codes (otherwise they will find it very difficult to gain any significant market share). Therefore a CPSO who did not provide access to these 118XXX codes might expect this to make its CPS product less desirable to customers.

3.5 However, and of greater relevance, all CPS customers are able to ‘over-ride’ CPS for any call and use any other operator with whom they have an agreement (and all BT customers will, by default, have an agreement with BT). As Oftel expects BT (amongst others) to offer a full range of 118XXX DQ services it will be relatively straightforward for a CPS customer to access any 118XXX DQ service even if there was a problem with their CPSO’s DQ service.

3.6 Oftel’s major concern is that the inclusion of 118XXX within CPS ‘all calls’ might impact upon the development of competition for DQ services. This is because CPSOs might not open their networks to the full range of 118XXX DQ services in the same manner that BT might be expected to do. A CPSO might then only offer its customers the choice of its own DQ service. Given that consumers are unlikely to base their decision on which CPSO to choose on the basis of the range and price of DQ services offered, this might have an impact upon the competitiveness or otherwise of the market for DQ services.

3.7 The level of CPS take-up in the UK is still quite limited as a percentage of the overall market, however take up is increasing substantially month on month. Should CPS reach a significant number of customers and CPSOs not have made arrangements with alternative DQ service providers, a large number of consumers might find themselves without the ability to make an easy choice of which DQ service to use (although of course they would still be able to use an over-ride code to access those services through another operator such as BT).

3.8 A large number of CPSOs refusing to allow competition on their own networks might be expected to have a greater impact upon DQ competition than the alternative impact that excluding 118XXX from ‘all calls’ might have upon competition in call conveyance (because of the low levels of expenditure on DQ relative to other types of call – see data presented earlier).

3.9 Because of Oftel's concerns about the development of competition in the DQ services market, Oftel would like to reiterate its expectation that, if 118XXX codes were to be included in the CPS 'all calls' option, CPS operators must make a range of DQ codes (apart from their own) available to their customers.

3.10 However, unlike the situation with a direct access operator or (potentially) with a WLR provider, a CPSO's customer will always have the option of over-riding the CPS service. Therefore, in order not to create an undue burden on CPS operators or DQ service providers, it would probably be unreasonable to expect CPS operators to make all 118XXX DQ codes available on their networks (in contrast, it might be more reasonable to expect a direct access operator or WLR provider to offer their customers a full choice of DQ services as their customers would have no easy means of changing provider.)

3.11 In this consultation, Oftel is seeking the views of all stakeholders, including DQ service providers and CPSOs, about whether it is reasonable to expect CPSOs (and DQ service providers) to negotiate arrangements to allow CPSOs to provide access to a range of DQ services in this manner.

3.12 A final issue that should be considered is that of potential consumer confusion. It might be argued that by including 118XXX within ‘all calls’ but not including 192, consumers could be confused as they might, potentially receive bills for DQ services on two different bills (although for different DQ services). Oftel accepts that there is some potential for confusion here – what is key in Oftel’s view is that all members of the industry (DQ service providers, access operators and CPS operators) will be promoting the move towards 118XXX and this should help to minimise confusion. Furthermore, whilst consumers thus far under CPS will have associated 192 with their access operator (BT), there will be less expectation that 118XXX will be carried by their access operator. Indeed in the long term, after 192’s withdrawal, there is another compelling argument suggesting that consumers may be confused if 118XXX codes (many of which will offer added value information services in addition to DQ facilities) were not included within ‘all calls’, as other similar services such as premium rate numbers are already in ‘all calls’.

3.12 As set out above, Oftel is minded to include 118XXX DQ services within the CPS ‘all calls’ option unless there are compelling reasons (supported where possible with evidence) why these services should be excluded.

3.13 Oftel welcomes the views of stakeholders on the questions below and on any other issues raised by this consultation. Annex A sets out Oftel’s proposed changes to the CPS Functional Specification.

Q1) Do you believe there will be any disbenefits if 118XXX codes are included within the CPS ‘all calls’ option? If so, why, and what evidence is there for these disbenefits?

Q2) Do you believe that it is reasonable to expect CPSOs (and DQ service providers) to negotiate arrangements to allow CPSOs to provide access to a range of DQ services (other than their own) for their ‘all calls’ customers? Should CPSOs be expected to offer all 118XXX DQ services to their ‘all calls’ customers?

Chapter 4 – Consultation process

4.1 Comments are invited by 20 August 2002 (six weeks). Following the consultation, there will be a 14-day period for comments on comments (Oftel has allowed for a six-week rather than a three-month consultation period to reflect the previous history of consultations on closely related issues).

Enquiries

4.2 Telephone and e-mail enquiries concerning this consultation document should be directed to:

Alex Campbell
Oftel
50 Ludgate Hill
London
EC4M 7JJ

tel: 020 7634 8970
fax: 020 7634 8893
e-mail: alex.campbell@oftel.gov.uk

Responses

4.3 Written responses should be sent to:

David Parsons
Oftel
50 Ludgate Hill
London
EC4M 7JJ

fax: 020 7634 8746
e-mail: david.parsons@oftel.gov.uk

4.4 Written comments will be publicly available from Oftel's Research and Information Unit and on Oftel’s website, except where confidential. Respondents are therefore asked to separate out any confidential material in a clearly marked annex.

4.5 In the interests of transparency, respondents are requested to avoid confidentiality markings wherever possible. Appointments to view written comments in Oftel's Research and Information Unit must be made in advance (tel: 020 7634 8761, fax: 020 7634 8946).

Alternative formats

4.6 A large print version of the summary section of this consultation is available. Copies of this consultation are available on disk and braille and tape formats of the summary can be provided on request.

4.7 Please contact the Oftel Research and Information Unit on 020 7634 8761, or email: infocent@oftel.gov.uk, or call textphone 020 7634 8769 for more information.

Annex A – Proposed modification to Functional Specification for CPS

A.1 If Oftel, following this consultation, were to conclude that it would be appropriate to include 118XXX codes within the CPS 'all calls' option, the CPS Functional Specification would need to be modified.

A.2 The proposed new Functional Specification (in the event of 118XXX codes being included within CPS 'all calls') is listed below. All the text remains as per the current version (version 2) with the exception of the text in italics (which is new) and the text with a strikethrough (which will be deleted and replaced by the new text).

A.3 Oftel also proposes two further additional minor changes to the functional specification to provided clarity. The first clarifies the type of unmetered Internet calls that are carried on the excluded 0844 04yyxxx and 0808 99yyxxx number ranges (under 'customer options (2) below). The second confirms that dialling 118XXX will not over-ride CPS (see 'Override' below).

FUNCTIONAL SPECIFICATION FOR CARRIER PRE-SELECTION (V3)

Definition

Carrier Pre-Selection (CPS) is the facility offered to customers which allows them to opt for certain defined classes of call to be carried by an operator selected in advance (and having a contract with the customer), without having to dial a routing prefix or follow any other different procedure to invoke such routing. CPS can be overridden by dialling an indirect access code of another operator (again where there is a contract between the customer and the operator).

Scope

Carrier Pre-Selection will be provided by the following originating operators:

• BT; and
• Kingston Communications,

on, or as soon as practicable after, 1 January 2000 (subject to any deferment agreed to by the Commission in the light of the timescales needed to introduce the facility, technically and geographically).

CPS facilities will be provided to any operator (referred to as the CPS Operator) which qualifies under Schedule 2 of the Interconnect Regulations and has established Points of Interconnection with the originating operator and been allocated a CPS prefix code and/or a Type B single stage indirect access code by Oftel.

Originating Operators will provide CPS facilities to all customers, on request of CPS operator, on direct exchange lines, including ISDN and Centrex lines (1). CPS will not be provided on public or managed payphone lines or lines on Low User Schemes.

Originating Operators shall support up to 100 CPS Operators on any switch. Where demand appears likely to exceed this limit, steps will be taken to develop further capacity.

Customer Options (2)

6. Customers opting to use CPS may take up both or either of the following options:
(a) International calls
(b) National calls
or they may make a single pre-selection for the following
(c) all calls, to include international, national, local, mobile, specially tariffed (eg freephone, local rate, national rate), premium rate, personal and paging

Customers opting to use CPS may select from the following options:

Option 1: International Calls
Option 2 : National Calls
Option 3 : All Calls (to include international, national, local, mobile, specially tariffed (eg freephone, local rate, national rate), premium rate, personal, paging and 118XXX codes for Directory Enquiry services)

If a customer selects Options 1 and 2 they can either have calls from both options carried by the same CPSO or by different CPSOs. In all other cases there is only one CPSO involved.

CPS will not apply to calls using Type A short codes (eg 100, 999, 112, 192), Type C (operator specific) short codes or the 0844 04yyxxx and 0808 99yyxxx number ranges used for unmetered interconnect Internet access (with unmetered interconnect).

Where no option is made, relevant calls will be routed according to the decision of the originating operator.

Local calls shall be interpreted as calls to those geographic destinations which are charged at local call rate by the originating operator.

Routing

Where a customer has elected to have calls routed by CPS, the following will apply:

1. calls to ranges subject to CPS (see paragraph six) will be routed according to the customer’s selected CPS Operator to an agreed Point of Interconnection; and

2. calls to ranges excluded from paragraph six will not be affected

Where a call is routed by CPS, the originating operator will prefix the customer’s dialled digits with the ‘CPS access code’ before passing the call across the Point of Interconnection. The CPS access code ensures routing through the originating operator’s network to the Point of Interconnection.

Where a pre-selected call is dialled using the local dialling format, the originating operator will insert the leading zero and area code between the CPS access code and the dialled number.

CPS facilities shall not apply to operator controlled calls, including transfer charge calls. Operator and other special services of CPS Operators will be accessed using the appropriate indirect access code.

A CPS access code will be a four digit non-diallable prefix (3).

Override

Calls made to Type B Indirect Access Codes will override CPS options and route to the operator identified by that code, without alteration to the digit string dialled by the customer (for the avoidance of doubt it should be noted that this does not included 118XXX DQ codes).

Billing

Responsibility for billing the calling customer on CPS and Indirect Access calls rests with the CPS Operator. Where no pre-selection or other form of selection has been made by the calling customer, the originating operator will bill for those calls.

CPS services

CPS calls will be provided as a standard interconnect service to qualifying CPS Operators.