1.1 This document sets out Ofcom’s strategic decisions about how telephone numbers will be managed over the next five to ten years. It follows a consultation process between February and May this year, in which we received over 220 responses . In this document, we describe our general strategic framework and some specific steps that we are taking now.
1.2 Telephone numbers are a critical national resource, for consumers, businesses and the delivery of key public services. They must be managed effectively, so that they are available when needed, do not have to be changed, and mean something to those who call them. This is Ofcom’s responsibility. This document describes how Ofcom intends to achieve these objectives in the future by managing telephone numbers, to give the maximum benefit to consumers.
1.3 It is important to stress that Ofcom does not intend to change the geographic telephone numbers traditionally used by most households and businesses. We do not think that this is needed, mainly because of changes we are making to how we manage the allocation and use of telephone numbers.
1.4 We have decided to simplify the non-geographic numbers currently beginning with ‘08’ and ‘09’ that are used by certain businesses and public services. This should make consumers more confident in using such numbers. We are also giving public services and private companies more choice of numbers, enabling them to reflect their customers’ willingness and ability to call different numbers. We have tried to limit any disruption caused by these changes.
1.5 The long-term plan for telephone numbering which we set out in this document is based on a set of strategic principles that we will take account of for all numbering policy decisions. These principles are designed to ensure that our numbering decisions always consider the interests of consumers and businesses. Consumers do not generally care about the more technical aspects of numbering policy, but they do care about the continuity of their own number, and they do want to be able to dial other numbers with confidence.
1.6 Ofcom has examined current concerns about telephone numbers - about their availability, their transparency to consumers, and the potential for consumer abuses associated with some number ranges. We will take various actions, within our new strategic framework, to address those concerns and so benefit consumers:
1.7 These decisions together implement the strategic principles we have developed. Some proposals will be phased in, to minimise the costs involved for providers and, ultimately, for consumers. But over time, these measures as a whole should produce a plan for UK telephone numbers which gives numbers clear and enduring meanings for consumers, which increases trust in certain number ranges, and which makes enough numbers available for current and future services.
1.8 As a result of these decisions the National Telephone Numbering Plan (‘the Numbering Plan’) will look like Figure 1.1 by the end of 2006. We have already had some feedback on the icons and descriptions we might use from consumer focus groups during the consultation period, and we will consider further in the next few months how and when to inform consumers of these changes and best use these images to raise consumer awareness.
|For future use|
|Reserved for personalised numbers|
|Business rate services|
|Premium rate services|
1.9 In this document we present principles that we will consistently take account of when looking at numbering policy issues. These principles are intended to promote the interests of citizens and consumers, by ensuring that:
1.10 This approach recognises that consumer interests are, in general, best served by promoting effective competition. How telephone numbers are provided is important for how service providers are able to compete. However, our approach also recognises the direct consumer interests concerning number misuse, and the broader citizen interest associated with continuity and availability of certain numbers.
1.11 This review was driven both by current concerns about numbering and a need to consider potentially major changes in the future. Twelve years after the management of numbering transferred from BT to the regulator, we wanted to address the current concerns, and to do so as part of a strategic framework that will also make sense in the future as technology and consumer behaviour evolve.
1.12 Ofcom must ensure that enough numbers continue to be available to consumers, so that they can benefit from the services which numbers support. We must also ensure continued trust in the meaning provided by numbers, so that consumers can use them with confidence. Over recent years these objectives have been threatened:
1.13 At the same time, the role and use of numbers is expected to shift dramatically over the next few years. Of particular importance is the emergence of Voice over IP (‘VoIP’) as a mature technology. This fundamentally changes the way in which calls are routed by telephone networks, and therefore fundamentally changes the role of telephone numbers. A variety of new communications providers are using VoIP technology to enter the market for voice calls, whilst those communications providers already active in this market are investing in ‘Internet Protocol’ (‘IP’)-based ‘Next Generation Networks (‘NGNs’). In time, these developments are expected to reduce the pressure on numbering capacity, support exciting new services and enable greater consumer choice, but they may also allow new forms of abuse and exploitation.
1.14 This review draws on a significant evidence base developed by Ofcom, covering extensive market research into consumer attitudes to and use of numbers, detailed analysis of current and projected demand for numbers, and technical, economic and legal analysis. We have built upon this with the help of over 220 consultation responses and other input from stakeholders and advisory bodies. The following paragraphs summarise our key decisions, which are discussed in more detail throughout this document.
1.15 We will seek to increase trust in UK numbering as a whole by establishing one or more consumer protection tests that enable us to deny allocations of numbers to providers that persistently and/or seriously abuse consumers. This proposal was strongly supported by all types of stakeholder in the consultation responses, both in relation to a test when allocating numbers and a test for withdrawing numbers.
1.16 Many stakeholders shared Ofcom’s view that more work is needed to ensure that the details of such tests are correct so that they can be as effective as possible and loopholes are avoided. Obviously any tests that Ofcom uses would need to be workable, and we therefore aim to consult in detail in this area later in 2006, following extensive work with stakeholders. We also need to avoid unintended consequences for competition and put in place systems to ensure that decisions under the tests are clear, consistent and appropriate.
1.17 An example of a possible test, which we referred to in consultation, is that Ofcom would refuse future allocations of numbers in cases where a provider has breached specific consumer protection standards more than once within the previous year.
1.18 Geographic numbers are widely recognised and trusted by consumers, most of whom still highly value the ability to keep their geographic numbers. But geographic numbers are in high demand due to a growing number of communications providers. The numbers that have been allocated are also not well-utilised, because the total pool of numbers is spread across many geographic areas.
1.19 We are taking action now so we can avoid number changes whilst continuing to make numbers available to support competition. We will do this mainly by allocating geographic numbers to providers in smaller-sized blocks (1,000 rather than 10,000 numbers) in any geographic areas where the current numbers would otherwise run out within five years. This is a lot tighter than such ‘conservation measures’ have been in the past.
1.20 Tighter conservation measures will improve the utilisation of these numbers, and substantially reduce the risk of number changes. A moderate improvement in utilisation rates, from the current average of 15 per cent of available numbers to about 30 per cent, would reduce the number of geographic areas currently at risk of number shortages from 34 to zero.
1.21 We can take this approach because it should only be required for the next five years or so, until the deployment of VoIP technology in general, and NGNs in particular, should allow the allocated numbers to be better-utilised. These technological changes should make it easier to allocate telephone numbers in whatever block size is most efficient from a numbering management perspective.
1.22 Ofcom has also considered contingency plans to make available additional numbers if numbers do become exhausted in a small number of specific areas. This might occur for unforeseen reasons such as substantial new housing development within a limited geographic area. Our view is that the most effective means of providing additional numbers in a targeted manner, to minimise consumer disruption, is to use ‘overlay codes’. These are second area codes to cover a geographic area that has run out of numbers. No-one would actually have to change their current code or phone number as a result of an overlay code being implemented in their area.
1.23 Our projections of future geographic number demand suggest that (before unforeseen demand shifts) perhaps six areas might need overlay codes by the end of 2012, with a worse-case scenario of 11 areas by then. However, we will aim to avoid these scenarios, partly through targeted audits of those providers which already hold numbers in these areas. Other areas with unforeseeably high underlying demand growth, perhaps associated with major new housing developments, may also need overlay codes. As there are over 600 code areas in total, the limited expected number of affected areas does not warrant the widespread change to current numbers or dialling behaviour that other fallback options require.
1.24 Even if technological change is slow, overlay codes therefore are the best general approach in any areas where conservation measures are not sufficient. Consultation respondents were nearly unanimous in favour of Ofcom’s general approach on this issue. Beyond that general approach, we will also take specific steps - such as aggressive reclaiming of unused numbers - to try to avoid overlay codes in those areas most likely to need them.
1.25 The original purpose of those non-geographic numbers starting with 08 and 09 was as a single point of contact for those businesses and public services which have a national presence and identity. These numbers also allow businesses and public sector bodies that make services available to the public to make charges using a micro-payment mechanism known as ‘revenue share’, whereby they take a share of the charges paid by the caller; this capability is widely used.
1.26 However, consumers have a poor awareness of the absolute level of call charges for these numbers and the nature of revenue-share. Also, a number of ‘scams’ have emerged which exploit revenue-share. The result has been a substantial erosion of consumer trust in these ranges.
1.27 Ofcom has already taken some steps to restore this trust as part of its Number Translation Services Review (‘the NTS Review’). In April this year, decisions were taken that will increase the transparency of charges for current 08 numbers and the degree of consumer protection provided in relation to them.
1.28 As well as consumer confidence issues, most of the 08 ranges that are currently in use are projected to run out in the next few years, due to strong growth in underlying demand. There are enough other 08 numbers available for these services, but we want to take this opportunity to make those numbers available in a way that benefits consumers by improving tariff and service transparency.
1.29 We therefore are creating a new type of number – starting with 03 - for those organisations who require a national presence, but who do not wish to make an additional charge to consumers for contacting them. We particularly expect this to be a range that public services will feel appropriate to use in preference to charged-for 08 numbers. We expect the new range to become trusted by consumers as covering clearly-understood services and price ranges. We will take several steps to build this trust:
1.30 Services which require small micro-payments will stay on the 08 range, getting new number allocations as required by demand. But creating the new 03 range gives us the opportunity to simplify the public description of 08 numbers over time.
1.31 Our strategic approach to the 08 range is that services will be described at the ‘two digit’ level. This implies only three categories of 08 numbers:
1.32 There are some numbers within these 08 range which are used to provide services where the historic link of call charges to geographic rates - 0845 for ‘local rate’ and 0870 for ‘national rate’ – has broken down. Ofcom’s NTS Review recently concluded that the cost of forcing providers to migrate from these numbers would be disproportionately high, and instead decided that it should repair and extend the linkage between 0870 calls and national calls to geographic numbers so that it applies to all communications providers. We will also review within two years whether to do the same for 0845 numbers. This remains Ofcom’s position. However, Ofcom’s expectation is that growth in such services can in future be accommodated on the new 03 range, and so there should not be a need for new number ranges linked to geographic rates in 08. As the new 03 range becomes familiar to consumers, and trusted by them, it may be that those providers currently using 0845 and 0870 numbers to provide services (especially those wanting the call routing advantages rather than the revenue-sharing facility) will decide to migrate to 03.
1.33 This strategy does not mean that the length of the numbers will change, but allocating and defining numbers in this way will provide a much simpler message for communications providers to give and their customers to understand:
1.34 We are leaving current 0800 Freephone service numbers (and 0808 free numbers) unchanged. This is the one type of 08 number that is reasonably well-recognised and trusted by consumers. The same number generally is used for Freephone services internationally, which may contribute to high consumer awareness. And there is no current danger of these numbers being exhausted.
1.35 We will also simplify the public description of 09 services, although more work is needed on the details. Consultation respondents overall varied on how to give a clear identity to the different 09 ranges. Some preferred associating the second digit with higher prices, as we are doing for 08 numbers. Some preferred to associate certain types of services (e.g., ‘charity fund-raising’) with distinct 09 ranges. There was, however, much agreement that sexual entertainment services (‘SES’) should have their own identity, using high 09 numbers. Ofcom has consulted separately on how to ensure continuing number availability for SES, and will shortly publish its conclusions. We plan to consult in detail later this year on the services and tariffs that can be provided across the rest of the 09 range.
1.36 Our decisions on the 03, 08 and 09 ranges should lead to the services being structured as in Figure 1.2 in the long-term. The specific tariff levels for the 08 and 09 ranges may change as Ofcom carries forward its plans to apply the tariff levels of the Numbering Plan to calls made from all lines (see paragraphs 1.45-1.47).
1.37 By setting out the strategic plan for 08 services and the new 03 range in this statement, service providers now have the necessary information to decide how to react to the forthcoming changes to 08 numbers as set out by the NTS Review in April 2006. Service providers can now be clear on what option they should take within 18 months of this statement, as required by the decisions of the NTS Review. When the changes set out in the NTS Review are implemented in January 2008 service providers could decide to:
|03||Calls at the same rate as calls to geographic numbers, no revenue sharing permitted|
|084||Calls up to 5ppm, revenue-sharing permitted|
|087||Calls up to 10ppm, revenue-sharing permitted|
|090-097||Distinct tariffs and/or services possible for each band of 090, 091, 092 etc (Ofcom to consult on detail)|
|098||Sexual Entertainment Services|
1.38 Ofcom recognises that the new structures for 08 and 09 will leave existing services in place on certain three digit numbers that are inconsistent with this long-term approach. We have decided against forced migration of 08 services at this stage, as that would raise a number of complex issues about migration costs, which the NTS Review has already covered. But the measures we are taking are designed so as to create a strong and positive brand for the new numbers which are made available, in the expectation that this will encourage voluntary migration over a period of time to the new structure. If this proves to be successful, then it may be appropriate to return to the issue of forced migration of remaining legacy services so that the longer-term meaning of the Numbering Plan is not limited by a minority of inconsistent services. The trigger for such a re-evaluation would be a level of voluntary migration which materially reduced the residual costs associated with forced migration. Ofcom will consider whether forced migration of 09 services is necessary when it consults in detail on future 09 tariff and service descriptions later this year.
1.39 Personal Numbering Services are provided on one specific part of the 07 range (070). Ofcom has several concerns about these services. There is very limited consumer awareness of ‘Personal Numbers’ as a concept, and legitimate personal numbering services have had relatively little market impact. At the same time there have been a number of cases where providers have exploited the poor awareness of this range, and the lack of call price ceilings, to run ‘scams’. This is despite previous attempts to restore trust in personal numbers, by removing the ability of 070 providers to use revenue-sharing.
1.40 In the short-term, Ofcom is therefore introducing a price ceiling on calls to personal numbers. If such a call costs more than this ceiling, customers will have to get a free pre-call announcement of the charge involved. The price ceiling will apply regardless of whether the call is made from a BT line, from any other fixed line, a mobile or a payphone. Ofcom is conducting a short further consultation on two options for this ceiling: a standard 20p (per minute or per call) for all customers, or the maximum that the specific customer would pay for a voice call to an 07 mobile phone number. The price ceiling arrangements should be implemented in early 2007.
1.41 As a long-term measure, Ofcom has decided to end the 070 personal numbering range. This will end the scope for confusion with 07 mobile numbers, which creates such potential for abuses. It is not currently obvious that there is a significant level of demand for genuine personal numbering services, so by the end of 2007 Ofcom will review their use to decide whether to open the 06 range of numbers for these services. If 06 is opened then, current 070 services would be expected to transfer by the end of July 2009, and we would cease to allocate new 070 personal numbers after 2007. As part of this review Ofcom will attempt to contact all providers who have been allocated 070 personal numbers.
1.42 Consumers primarily associate the 07 range with mobile services, and this provides a degree of tariff transparency, making clear when consumers are paying a premium for a mobile service. Removing personal numbers from 070 will allow us to consolidate this recognition, by formally designating the 07 range as being for mobile services. Demand for mobile services remains strong, so the 07 sub-ranges of 071-075 will be designated for mobile services to enable continuing growth in competition and variety of services. We will allocate mobile numbers in smaller quantities where appropriate to help ensure enough numbers for new entrants and existing providers.
1.43 As set out above, Ofcom may migrate current 070 ‘follow-me’ services - personal numbers – to the 06 number range. These migrating services and any new 06 personal numbering services would be expected to follow the same price ceiling as for 070 numbers.
1.44 In addition, we have decided to reserve the 06 range for the longer term to allow for the allocation of ‘individual numbers’. These would differ from personal numbers in that they would be allocated directly to end users. Personal numbers, by contrast, are allocated to communications providers. A number of practical issues need resolving before we could do this.
1.45 Part of the transparency problem for a number of services is that the tariff levels set in the Numbering Plan only apply to calls made from BT lines. Ofcom firmly believes that the whole purpose of the Numbering Plan is to provide transparency about the services and prices involved when making a call, so that consumers can make informed choices. The ability of consumers to make informed choices is severely compromised when tariff transparency only applies to calls made from a single provider.
1.46 Ofcom therefore intends to develop descriptions for the various services across the Numbering Plan that will apply to calls from all lines. This has already begun in this statement by establishing a link between calls to 03 numbers and geographic call rates that applies to calls from all lines, and through the common price ceiling on which we are consulting for calls to 070 personal numbering services. This approach will be extended to other number ranges, including the 08 and 09 services for which this has been a more common concern.
1.47 Applying tariff descriptions in this way does not depend upon a provider having Significant Market Power (‘SMP’) in delivering a particular service. Rather, it is about providing clarity to consumers through general obligations on all relevant providers. Ofcom acknowledges that there are complex issues involved in developing Numbering Plan descriptions that will cover calls from all lines, including mobile phones, given that call origination costs and charges vary between networks. We will analyse these further in the second half of 2006.
1.48 Ofcom currently manages numbering using complex rules and processes that are designed, for example, to ensure that providers use numbers efficiently. At a strategic level, we have concluded that some use of market-type mechanisms might be more effective, and certainly less intrusive.
1.49 We recognise that measures such as charging communications providers (not consumers) for number allocation need to be assessed in terms of whether they add value to solving a problem and are an efficient way to do so. Many consultation respondents made this point. Charging for numbers could be useful in providing incentives for efficient use of the numbers that are allocated to providers, but this needs to be assessed further. We also need to ensure that appropriate legal conditions are met for any number charges, for example that particular types of provider are not discriminated against. It is also worth noting that any charges would be set at a level that would not significantly increase the costs faced by consumers.
1.50 Ofcom has begun a separate project to assess the complex issues involved in charging for numbers. Were charges to be introduced, this would not happen before 2007. Ofcom is aware that by signalling the possible introduction of such a charge, providers may apply early for numbers that they do not yet need in order to avoid future charges. Ofcom wishes to make clear that such behaviour will not be rewarded. For example, any charge which is introduced is likely to include an annual charge that would be applied to all allocated numbers.
1.51 A number of Ofcom’s decisions in this document require us to make changes to the Numbering Plan and accompanying number application forms. These decisions are to open the 03 range, designate more 07 numbers as being available for mobile services, apply an 070 price ceiling and introduce new definitions of conservation areas for geographic area codes.
1.52 These consultation measures are covered in Annexes 2 to 8 of this document. We will aim to conclude those consultation processes rapidly, if possible by the start of October 2006, at which point the new framework for conservation of geographic numbers should be in place, and communications providers will be able to apply for 03 numbers. We expect that 03 numbers might be available to be dialled in early 2007.
1.53 As stated above, several strands of work have complex issues and still need to be completed. These are the consumer protection test; charging for numbers; revising the service descriptions in the Numbering Plan, including the precise structure of the 09 number range; and applying common tariff provisions in the Numbering Plan to all originating providers. Ofcom needs to consult further to implement changes for these issues, and we expect to do so later in 2006.
The full document is available below: