The Universal Service Obligation (‘USO’) ensures that certain basic fixed line services which are considered essential to everyone are available to all consumers upon reasonable request at an affordable and uniform price across the UK. Services provided under the USO include reasonable geographic access to call box services from Public Call Boxes (‘PCBs’).
BT’s request for consent
Under the specific Universal Service Condition 3.5 BT has to provide services from PCBs on the basis of uniform prices throughout the UK (excluding the Hull area) unless Ofcom consents otherwise.
BT has requested consent to provide call box services in the UK (outside of Hull) at non-uniform prices to the extent necessary to operate geographic public payphone tariffing trial(s) periodically over the next three years.
If granted the consent will mean that some consumers will pay different prices for calls from certain BT PCBs depending on whether the consumer is using a box operating under the tariffing trial(s) or one of the boxes unaffected
BT explains that the ability to conduct geographic tariff trials from time to time will enable BT to test price sensitivity and to assess how consumers respond to new prices and whether the increased use of PCBs is stimulated. In addition, BT argues that tariff trials limit commercial risk associated with implementing an untested price nationally.
BT has proposed certain criteria that would apply to trials under the requested consent. These relate, amongst other things, to the proportion of the PCB base affected and the maximum length of trials.
At the end of each trial all affected PCBs will either revert to the original price or a new price will be implemented nationally.
BT will notify Ofcom with details of the trial at least six weeks prior to the implementation of the trial. BT will publish the price and terms of the trial two weeks prior to implementation.
BT has notified Ofcom of its intention to trial reduced price calls to mobiles from PCBs in the Nottingham area for four months if consent is granted.
On 6 March 2007, Ofcom published the consultation document BT Public Call Boxes in which we proposed to consent to non-uniform charging for geographic public payphone tariffing trials over the next three years in the circumstances set out in BT’s request and provided certain conditions are met as set out in the consultation document and in Section 3 of this statement.
In making this proposal we took account of the disadvantages of implementing tariffing trials or untested tariffs nationally across BT’s network and the importance of having effectively managed implementation of temporary geographic trials that resulted in an appropriate tariff that had been tested and minimised costs and disruption to consumers and to BT on a national basis.
The consultation document set out Ofcom’s reasoning in an Explanatory Memorandum and included both the draft consent and an Impact Assessment. We invited views from stakeholders on Ofcom’s proposal to consent to non-uniform charging for geographic tariffing trails and, in particular, on the terms and conditions of the Consent.
Alongside the general questions of whether respondents agreed with our proposal in principle, we invited comments on two specific issues in the consultation:
- whether 26 weeks is appropriate for the maximum length of trials; and
- whether the total number of trials at anyone time should be capped.
We have now considered all of the responses received to the consultation. Two responses, one from BT and one from a member of the public, agreed with the proposal to consent. Three members of the public opposed the proposal to consent on the grounds that geographic tariffing trials were unnecessary and discriminatory.
Taking account of the responses received and for reasons set out below, we have decided to consent to the provision by BT to provide call box services in the UK (outside of Hull) at non-uniform prices to the extent necessary to operate geographic public payphone tariffing trials periodically over the next three years until 3 June 2010 and under the proviso that certain criteria set, relating to the notification, extent and length of trials, are met.
Ofcom intends to monitor the impact of geographic tariff trials under this Consent and may modify or withdraw the Consent at any time under section 49 of the Communications Act 2003 should it consider it appropriate in the interest of users of PCBs.
The full document is available below: