text:
Draft Oftel management plan 2003-04 - Consultation, 18 December 2002 |
Chapter 1 Priorities for Oftel's final management plan Chapter 2 Looking ahead to Ofcom Chapter 3 Proposed projects and programmes 2003/4 Chapter 4 Oftel's resource plans for 2003/4 Chapter 5 Consultation process and questions and alphabetical list of projects and programmes Annex A Oftel's regulatory principles Annex B Summary of Oftel regulatory decisions - 2002/3 Annex C Indicative EU Market Review timetable Annex D Indicative Consumer Protection Policy Review timetable Annex E Developing Oftel's understanding of telecoms demand Foreword from the Director General of Telecommunications This draft Management Plan sets out Oftel's proposed projects, programmes and budget for 2003/4. Oftel is seeking views from stakeholders by 31 January 2003. This is, of course, likely to be a momentous year for all those concerned with the regulation of communications in the UK in that the Communications Bill, currently before Parliament, provides for the transfer of Oftelís powers and responsibilities to Ofcom. This could mean in practice that Oftel will cease to exist during the course of the work covered by the draft Management Plan. We have decided, however, that ëgood governanceí makes it sensible not to anticipate the enactment of the Bill and that we should set out an agenda for Oftel for the full year in the usual way. We also set out in chapter 2 of the draft some ëthoughts for the futureí which Ofcom may wish to bear in mind as it develops its own Management Plan. It is also, of course, the reality of life that the market does not stand still while organisational change is being implemented. There have been major changes in the market place over the last year as a result of competitive developments and the uncertain financial environment for all companies in the industry and the Plan reflects this. We also have a major programme of work to implement the new EU regime for communications which needs to be completed by July and thus before Ofcom begins. Oftel wants to receive views on its proposed work from all those with a stake in the UK electronic communications market ñ consumer groups, telecoms operators, service providers, other regulators and Government. We would also welcome views from other European regulatory authorities. David Edmonds Director General of Telecommunications Oftel plans for 2003/4 - Executive summaryS1 There have been major changes over the last year in the telecoms markets as a result of increased competition, and because of an often-turbulent financial environment. Areas where Oftel has undertaken major initiatives include Oftel's EU market review programme, the continued work to create a regulatory framework that promotes effective competition in the broadband market, and major changes in how Oftel deals with dispute resolution. S2 Oftelís management plan for 2003-04 reflects the need to complete these major areas of work ñ particularly the EU market reviews ñ and to ensure that on-going projects and programmes continue to run smoothly in areas such as complaint handling and number allocations. S3 Continuity of processes will be especially important given the other major change in 2003-04, the setting up of Ofcom. Oftel will continue to work with its partner regulators in the move towards the formation of the new organisation. S4 The management plan looks at areas of Oftelís work that will be developed during the coming year. For example we intend to employ tougher criteria for accepting and resolving disputes, and to use data more effectively. S5 The plan also considers how further developments to the regulatory decision making process can be made. One option that will be explored is the adoption of a regulatory approach that acts as an incentive for action. For example we consider there is potential to apply more widely the approach Oftel took to BT price controls during this year which has stimulated a new wholesale market. S6 Looking ahead there will be key policy challenges for Ofcom ñ notably the introduction of spectrum trading, the challenge of balancing increased competition in communications markets with public service broadcasting arrangements, and the need to work with other appropriate lead agencies for a broadband market that successfully addresses issues of content property rights to enable consumers to access what they want to see and hear while retaining incentives for content producers to develop attractive content. S7 The draft plan sets out Oftelís full work programme, proposed budget for 2003-4 and details a number of consultation questions for stakeholders to give their views and comments on in preparation for the formal adoption of the plan in the spring of 2003. The feedback from stakeholders will be considered in the drafting of the management plan statement for 2003-4.
Target |
Effective competition benefiting consumers objective Increase the extent to which the market is effectively competitive or effective competition is in prospect |
Well informed consumers objective Increase:
Adequately protected consumers objective All consumers protected by:
Prevention of anti competitive practice objective encourage and secure a reduction in significant anti-competitive practice by taking effective action |
Overall spending on Oftel will deliver value for money |
1.41 The first set of service delivery outcomes was reported in Oftel's 2001 Annual Report. As noted above, outcomes on the above targets for the current year will be reported in Oftel's 2002 Annual Report.
Pressures on regulation in 2003/4
1.42 There are a range of pressures on regulation in 2003/4 against the above backdrop of market developments and regulatory actions taken in 2002. These pressures are:
1.43 Clearly Oftel needs to take account of and respond to the expectations of stakeholders. However, it does this within a coherent and explicit framework which has been articulated in terms of its strategy ie its goal, objectives and regulatory principles set out earlier in this chapter and in Annex A. Oftel's work plan for 2003/4 is therefore a combination of actions that flow from implementing its strategy (including existing and continuing actions), measured and managed responses to requests for action by stakeholders, and preparations to enable and assist the establishment of Ofcom.
Expectations of stakeholders
1.44 he expectations of Oftel by stakeholders are significant and are, broadly, as follows:
1.45 A more specific point is that there are greater demands from competitors to use BTís network. Oftel needs to respond positively to this, but in so doing be careful not to close off future 'build' opportunities. Oftel's Access Guidelines (published in Sept 2002 ) set out the approach Oftel proposes to follow in balancing these demands.
Existing regulatory commitments and implications of strategy implementation
1.46 In a number of areas, Oftel has started or is committed to implementing regulatory processes which will be relevant to 2003/4 and will form a significant element of its work for the forthcoming year:
Preparing for Ofcom
1.47 Throughout 2002 Oftel worked closely with our partner regulators in contributing to the creation of Ofcom. A key milestone was the major consultancy report completed in October 2002 and built on intensive background work by teams of regulatorsí staff as well as consultation with stakeholders. It offers detailed thinking on how Ofcom should be organised and suggests an implementation plan for setting up the new body in 2003.
1.48 The Ofcom Board, to which appointments were made in October following Lord Currieís appointment as Chair earlier in 2002, will be deciding how to take this work forward. Oftel will maintain its close involvement, right up to the point when enactment of the Communications Bill in the 2003/4 session provides for the transfer of Oftelís functions and powers to Ofcom. In particular, Oftel will work to
1.49 Chapter 2 looks forward to Ofcom in more detail.
Chapter 2
2.1 As noted in chapter 1, during 2003/4 Oftel is likely to cease to exist and its functions, as reflected in the Communications Act once passed, will be taken on by Ofcom. Oftel is already working with the Ofcom Board and the four other communications regulators (BSC, ITC, RAu and RA) to create the new organisational structure. Ofcom, in discussion with the regulators, is now beginning to address policy issues so that the benefits of a single communications regulator can be maximised. This chapter focuses on the areas of work Oftel is involved in that will be of relevance to Ofcom, in particular:Improvements in regulatory processes
2.2 While Oftel's work is focused on achieving outcomes for consumers, it is important, in terms of accountability and inclusivity, that its processes are efficient, effective and transparent to all its stakeholders. This need will be even greater under Ofcom as the greater size of the regulator, and wider range of areas it will cover, means that the potential risk of unclear or inefficient processes is increased. Where regulation is well targeted it should produce benefits for consumers in terms of:
2.3 There are a number of current developments in terms of Oftel's regulatory processes that could be usefully considered, and as appropriate, further developed by Ofcom:
Focusing regulation
2.4 Oftel needs to ensure regulation is targeted and effective, particularly as the reduction in the availability of funds from capital markets is likely to continue to put more pressure on competitors to incumbents. This could result in more requests to the regulator to intervene to enable access to the incumbents' network. Often these demands can be contradictory and differing in their nature. It is therefore important to manage and prioritise regulatory workloads.
2.5 Where Ofcom is faced with competing demands for regulatory intervention that exceed the regulatory resources available it will need to have both robust mechanisms and a clear set of strategic objectives to allocate regulatory resources to those areas where they can be best used. Oftelís experience in developing this approach should be helpful to Ofcom in this regard.
Targeting regulatory involvement in resolving disputes and other cases
2.6 Oftel issued a consultation document in November 2002 on how it proposed to enable disputes to be completed in four months. This will be achieved through a sharper focus of regulatory resources to enable more efficient processing of individual cases that Oftel accepts for investigation. Cases referred to Oftel which fail to meet minimum criteria will not be accepted as disputes. This is explained more fully in para 1.35.
2.7 These changes build on a number of changes to the structure and working methods of the Compliance Directorate in the course of 2002. These include the establishment of a new economic and business analysis unit, tighter case management processes and more flexible use of staff.
2.8 These actions were necessary not only to meet the new deadlines, but also to underpin greater and more effective use of the Competition Act since publication of the Competition Act strategy statement in July 2002.
2.9 Further actions to focus regulatory efforts in relation to casework are evident in
2.10 Oftelís experience in applying and developing these approaches in the coming year should provide a useful contribution to Ofcom in its efforts to focus regulatory resources.
Use of regulatory option appraisals
2.11 Options open to the regulator to take action to address problems identified need to be carefully and transparently considered. As set out in Chapter 1 Oftel published a statement in July 2002 which sets out its approach to undertaking 'regulatory option appraisals' in respect of key policy decisions it takes.
2.12 Examples of option appraisals in 2002 include number portability framework options (published in June 2002) and proposals for improving the strategic focus of market information collected (January 2002).
2.13 Oftel will develop its approach in this area through application of appraisal techniques to policy and case remedy proposals. This experience should be valuable to Ofcom where the draft legislation requires rigorous and transparent assessment of proposals to be undertaken where these appraisals will benefit from taking place within cross-functional project and case teams responding rapidly to issues and allowing both the retention and sharing of expertise.
Targeting consumer information
2.14 As a part of its long-standing commitment to evidence-based regulation, Oftel is developing a number of techniques in relation to its understanding of consumer behaviour - which allow it, for example, to better target information designed to help consumers make more effective use of choice.
- Identifying types of consumers
2.15 Oftel's expanded market research programme is now in its third year and so provides a sufficiently extensive database to better understand consumer behaviour across the various telecoms markets in a forward looking way.
2.16 This is important both to help assess current initiatives from a consumer perspective, and as a preliminary look at how consumers can be considered in a more converged environment. It will, therefore, be of relevance to Ofcom.
2.17 The chart below sets out the main residential consumer groups identified through this analysis. (Details are given in Annex E.)
Figure 5: Summary of consumer profiles
Base: 8404 UK residential consumers, 2001/02
2.18 In terms of application, the cross-market analysis of consumers can be of considerable benefit by helping regulation to : target consumer information initiatives on the most relevant groups; help assess the likely size of markets for new products; identify those consumers who are most vulnerable; focus on the most relevant consumer groups who can help to exert pressure at a retail level and thus complementing regulatory initiatives taken at the wholesale level. This approach will therefore help to target and prioritise the use of regulatory resources.
2.19 The intention is to develop a similar analysis for small and medium sized businesses which will enable Oftel to further focus its small business information initiatives (eg TelecomsAdvice.org.uk) on appropriate business profiles.
2.20 Oftelís experience in developing and using these consumer profiles will be available for Ofcom to consider and further develop and apply as appropriate.
Assessing if consumers are losing out
2.21 A further example of how Oftel is developing its approach to targeting its resources is in relation to concerns that consumers are losing out by paying more than the cheapest available price for telecoms services due to confusion over complicated tariff structures. This has been a recurring theme of consumer representatives and media commentators. From a regulatory point of view, what is needed is a way of identifying if consumers are in fact losing out or, conversely, to what extent they are making well informed choices based on factors other than price.
2.22 Oftel is developing an approach that will use market research, pricing and other data specific to the circumstances of the market in question. This analysis together with better targeting, enabled by the consumer profiles described above, should result in greater focusing of regulatory action.
2.23 This type of approach is likely to have a wide range of applicability for both telecoms markets and other markets with which Ofcom will be involved, where consumers are faced with choices over the purchasing decisions they can make. With this wider application in mind Oftel will continue to develop this approach, liasing with OFT and other regulatory bodies in the lead up to Ofcom and feeding into any early consultations Ofcom may undertake on these issues.
Incentivising a positive response to regulatory action
2.24 Oftel's recent experiences of developing regulation in relation to local loop unbundling, partial private circuits and carrier pre-selection has demonstrated that detailed regulation can take several years to put in place. Given the pace of change in electronic communications markets, many argue that regulation needs to move much faster than this. But the same stakeholders are often the most keen to ensure "due process", which restricts the scope for rapid action.
2.25 Exploring the scope to 'incentivise' dominant players (in an open, transparent way which meets legal requirements) to co-operate in achieving regulatory objectives may offer a prospect of avoiding the lengthy timescales and unavoidable "micro-management" characteristic of some recent initiatives.
2.26 Oftel is currently pursuing a wholesale line rental (WLR) initiative where Oftel will relax retail price control in the fixed link residential voice market, when it considers that BT has delivered a fit for purpose wholesale line rental product that enables the development of an effectively competitive retail market. This initiative has provided an incentive for BT to provide the wholesale products both swiftly and effectively.
2.27 This 'incentive' approach may have a wider regulatory application. A regulated company has a range of legitimate responses to regulatory initiatives including the route of appealing against a particular decision in terms of compliance with due process and, under the terms of the new EU framework, on the merits of the case as well. It can be argued that the existence of these rights, perfectly justified in terms of the companyís legal position, nevertheless encourages operators to adopt a tactical approach towards regulatory issues which then have the effect of delaying the introduction of market developments. To give the regulated company an incentive to take a more co-operative approach, it needs to know how the regulator will be likely to react to different actions which it might legitimately take in response to regulatory initiatives. Greater clarity of the consequences of action by the regulated company can improve understanding and secure greater commitment by all parties to achieving the stated aim.
2.28 Where a company has dominance and acts in a co-operative and timely way to help achieve regulatory goals, then it needs to be clear of the consequences of this, for example, that existing regulation is no longer necessary and would be removed.
2.29 Conversely companies with dominance need to be clear about the consequences of actions that are anti-competitive or in some other way frustrate the achievement of legitimate regulatory goals. This is relevant not only in terms of formal penalties under the Competition Act and the Communications Bill if enacted - in terms of powers to fine and for third parties to claim damages - but also in terms of lost opportunities to secure a lessening of regulation.
2.30 Additionally where telecommunications operator display a willingness to pursue self and co regulatory initiatives, they reduce the pressure on the regulator to impose formal regulation. Oftel's experience of encouraging stakeholders to take more responsibility for tackling problem areas themselves should be helpful to Ofcom.
2.31 Ofcom will be under significant pressure to deliver effective, rapid regulation. An understanding that the regulator will stick to its stated objectives and principles in a coherent, evidence based and transparent way - when faced with demands from players in the market predicting serious consequences for their business if regulatory decisions are not the ones they prefer - will give credibility and force to initiatives designed to incentivise co-operative behaviour by regulated companies.
Minimising risk
2.32 In the period leading up to Ofcom there is scope to develop further the application of these two approaches ñ of focusing regulation and enabling its more rapid development where regulation is needed - in other areas of Oftel's work.
2.33 A 'focus and fast forward' approach will allow more effective management of the principal risk Oftel (and Ofcom) faces ie of not delivering on regulatory objectives. More resources can be focused on the areas with the best potential for successful development and these resources can be used to best effect by using all the regulatory levers available. Better focusing of resources should help ensure adequate resources are committed to cases and so minimise risk of successful appeals. This may involve taking carefully judged risks in order to take timely action with best available rather than perfect information - compromises which may be critical to Ofcom given volume of work and pace of change it will face.
2.34 This approach may allow risk management to be properly considered in the context of the objectives Ofcom is seeking to pursue and the way it approaches its work.
Opportunities for a better deal for consumers under Ofcom
2.35 Ofcom is being established because of the changes brought about by digitalisation - a technological step change that massively increases the capacity and flexibility of networks. Networks and service delivery platforms that have been in separate markets will, increasingly, be able to carry the same or equivalent services and so will be able to compete with each other. Consumers can benefit from increased competition brought about by such increases in convergence.
2.36 In making progress to the longer term prospect of convergence, current and emerging consumer attitudes and views will need to be taken into account, in terms of
2.37 All these factors are relevant to Oftel's, and subsequently Ofcom's, consideration of regulatory challenges in the years ahead. Key policy areas, in which Oftel's current locus is limited, but where Ofcom will have greater opportunities for influence include:
Broadband developments
2.38 Broadband take up is happening in the UK at a rate of almost 30,000 households a week. This represents an increase over previous levels and is likely to have been spurred by a combination of price falls and developments in broadband capability. Current broadband is, however, in most cases simply providing faster access to services and content that are also accessible by narrowband on a largely satisfactory basis particularly in terms of price of unmetered dial up services.
2.39 However if broadband is to achieve its potential to become a mass market service ñ similar to mobile ñ then users will probably need to be able to access more attractive content through broadband than is currently available. The need for compelling content was a key finding of a recent report commissioned by Oftel on factors to drive mass broadband take up.
2.40 If broadband is to access more attractive content and enable use of high definition websites then the issue of protection of intellectual property rights ("IPRs") and copyright over content will need to be addressed especially in relation to films and music where content producers have concerns that broadband will enable content to be pirated on a large scale. The concerns of producers of content - whether films or music or websites - is that if they fail to receive rewards for producing output then the incentive to develop further content will be undermined. Against this is the need to find ways of providing attractive content to make use of broadband capabilities.
2.41 Technology advances plus appropriate protection of intellectual property rights may provide the opportunity to exercise sufficient control to reward content providers while increasing access to attractive content for users. Oftel will be working with its stakeholders and Ofcom partner organisations and relevant lead government bodies, such as the Patent Office, to explore the scope for these developments at both a UK and international level and to consider what role regulation can play to bring these about. Given the scale of the task this is likely to be a major issue for Ofcom to tackle.
Radio in the local loop
2.42 The primary means for delivering broadband in the UK is via copper delivered ADSL or cable networks. However these fixed networks have their limitations in terms of being able to reach rural households; and hence tackle issues related to digital divide concerns. It is possible to use radio to provide wireless local loop services. Radio has a number of advantages, not least of which is the ability it offers to by-pass a local loop incumbent and promote competition in the provision of broadband services. It also has the advantage that in terms of economics, it is more suitable for lower population densities than the laying of new cables. To this end the Radiocommunications Agency (RA) has set aside spectrum for wireless local loop services in a number of frequency bands. The most recent was the award of spectrum in the 28 GHz band for broadband wireless access (BFWA). Licences for 60% of the UK population were taken up last year, and the companies that won these licences are beginning to trial and deploy such systems. There is also the possibility of using satellite based services for the provision of broadband in rural areas. However to date, although ubiquitous in availability, the cost of these technologies is high relative to broadband available via cable or copper.
2.43 The RA is also currently considering the award of spectrum at 3.4 GHz for wireless local loop, which will be especially suitable for provision of ADSL type services in rural areas. This is because of the technical characteristic of the spectrum, which gives it greater range than higher frequency bands (and hence greater coverage). There also developments in new radio technologies that allow the data for one household to be relayed by other households in the same radio network (mesh technology). This could allow deregulated spectrum (that is spectrum that is not licensed to any single user, but can be used by all) to be used to provide ADSL like broadband services using cheap and widely available radio equipment. This again would be especially useful in lightly populated areas such as hamlets and villages.
2.44 Looking forward, Ofcom will see the management of the radio spectrum and the regulation of telecommunications moving to a single organisation. This will help in providing a more of a joined-up approach for using both spectrum and network access (telecommunications) regulation to tackle such issues as broadband provision in rural areas.
Spectrum trading
2.45 Spectrum plays a pivotal role in the development of competition in the UK telecoms market and the Director General has a duty under the Telecoms Act 1984 to provide advice to the Secretary of State on competition issues relating to the licensing of spectrum. The review by Professor Martin Cave of spectrum management in UK published in February 2002 concluded that there was significant scope to release more radio spectrum into active, economic use by the introduction of spectrum trading. The Government response published in October 2002 agreed with the Cave reportís conclusions. Oftel considers, in agreement with Cave, that creating a market in spectrum has the potential to significantly increase the degree of convergence and competition across electronic communications networks and services to the benefit of consumers.
2.46 Spectrum is a vital part of the telecommunications market. The Radiocommunications Agency estimates that the value of spectrum to the UK is £20 billion a year. Spectrum supports a range of telecoms services including mobile phone services and wireless broadband networks. The current financial climate has put an even greater focus on the use of spectrum to provide competing infrastructure, because radio networks offer a cheaper alternative to creating networks including broadband, particularly in rural areas, compared to traditional cable or wire networks. All this makes access to spectrum vital for creating a potentially competitive telecommunications environment.
2.47 Given the ever increasing speed of technological change and convergence, and the complexity of decisions required to allocate spectrum by central planning, a market based system is essential to maximise the benefits to consumers and business that spectrum based services can provide. A flexible spectrum trading environment would allow the buyers of spectrum to make the commercial and technical judgements about what will be a viable business. In such a trading environment new and innovative ideas using spectrum could be more easily tested in the commercial world and those businesses that are best able to deliver the services consumers want would prosper.
2.48 Spectrum trading is a very important element in reducing barriers to entry into the telecommunications market, as well as being able to boost the UK's position in broadband. Whilst spectrum trading cannot remove all such barrier problems, easier access to it could become very important element in facilitating entry at the network level. Any spectrum trading environment does need to take account of concerns regarding harmful interference and international commitments. But the need for proportionate intervention to achieve this does not negate the benefits of improved economic efficiency; and the opportunity to enable broadband Britain to happen more quickly, and be available to a greater part of the UK population - particularly in rural areas - as a result of effective trading.
2.49 During 2003/4 Oftel will seek opportunities to work with Ofcom colleagues and stakeholders to develop key issues that will need to be addressed to underpin spectrum trading ñ in particular defining a spectrum property rights and a spectrum property register, and developing dispute resolution policy in relation to spectrum matters generally in line with the new EU framework.
Public Service Broadcasting and competition
2.50 Oftel is involved in the economic regulation of certain aspects of the broadcasting infrastructure in the UK. In particular:
Regulating the terms and conditions for the supply of digital conditional access, access control and access to electronic programme guide listings (the latter jointly with ITC) to broadcasters; and
Licensing, and applying, a price control to terrestrial analogue transmission.
2.51 Oftel's involvement in broadcasting regulation reflects both broadcastingís traditional basis in terrestrial analogue services, where there were only a limited number of free to air channels, and of its expansion beyond these analogue origins into a multichannel, interactive future. As digitalisation increases the opportunities for more services, Ofcom faces a significant challenge in enabling the benefits of public service broadcasting to be retained alongside its role of promoting competition in the broadcasting sector.
2.52 The ITCís review in 2002 of the programme supply market has focused attention on key aspects of this, including the ability of independent producers to negotiate retaining key rights to programmes (eg for overseas sales or repeat showings) which they have made for PSB broadcasters. Ofcom will have the opportunity to address any significant adverse effects on competition that may arise where those commissioning programmes are in a stronger position in terms of market power compared to those making the programmes.
2.53 Oftel will, where appropriate, contribute to the evolution of policy in the above areas through its experience of regulation in broadcasting and in telecoms. Its experience of successfully managing the development of competition alongside the operation of universal service obligations is usefully analogous to public service broadcasting. Oftel's experience of using the Competition Act in telecoms will also be valuable since Ofcom has now concurrent Competition Act powers in broadcasting.
2.54 Oftel is committed to helping Ofcom to be a successful regulator that delivers benefits to consumers. Ofcom will be an economic regulator to a substantial degree and therefore Oftel's experience and knowledge of regulating a £45 billion turnover telecoms industry will be a key asset for Ofcom.
2.55 Ofcom presents exciting opportunities at both a strategic level to improve the outcome for consumers and at an operational level, to adopt efficient and effective operational processes. Oftel will be working hard with its stakeholders and future Ofcom colleagues to realise these opportunities as soon as possible.
3.1 The proposed projects and programmes for 2003/4 are described in this chapter. Table 1 lists the projects and programmes by quarter (beginning April-June).
Any organisation or consumer who wants to discuss a project or programmes should contact the named project or programme manager directly. This applies to
suggestions as to the appropriate evidence base including market research;
discussions of policy options; and
suggestions on ways of conducting the project.
3.2 A number of Compliance Directorates projects have been combined into the Compliance Management Office (CMO). The CMO will cover the work of the previous projects of Retail Pricing, the Compliance Monitoring Unit and any parts of the former Casework Quality Programme that are not covered by the Business Assurance Programme (F4). The CMO will allow for a more focused and co-ordinated approach to these areas.
3.3 The EU Market Reviews Programme (A1) is under way and Oftel intends to have completed all necessary market reviews by the time the new Directives come into force in July 2003. An indicative timetable for the reviews can be viewed in Annex 2.
Stages of work
3.4 The planned work against objectives and type of activity reflects our focus in each subject area in 2003/4. Projects and programmes will contain elements that relate to other objectives and activities. Projects are likely to have the sequence of review ñ implementation ñ monitoring. The timescale will depend on the scale and complexity of the issue.
3.5 Oftel is committed to monitoring and evaluating its policies to see whether they are achieving the policy objective initially set. This will be on the basis of both pro-active monitoring and response to specific complaints.
3.6 Where a review, concludes no specific regulatory intervention is necessary, then the cycle of review ñ implementation ñ monitoring will end.
Evaluation of policy and case decisions
3.7 During 2003/4, Oftel will be using its review and appraisal processes to establish the basis for more rigorous assessments of the impact of its policy and case decisions.
3.8 Establishing more explicit criteria to assess and evaluate outputs and outcomes in individual areas is consistent with a more robust, targeted and faster evidence based approach as discussed in the previous chapter. In applying this approach, Oftel recognises there is not a mechanistic relationship between actions to promote competition and the resulting outcome. Outcomes need to be considered in relation to specific areas, but also 'in the round' at a broader level as picked up by Oftel's Service Delivery Agreement measures and targets.
Stakeholder involvement
3.9 The scope for stakeholder involvement will vary by subject area. Stakeholders can for example participate by providing evidence of competition, or evidence of consumer detriment and comment on which forms of regulatory intervention may be appropriate. For implementation activities, stakeholders may comment on operational details of how a policy is to work in practice. For monitoring activities, stakeholders may be involved eg as an end user in assessing comparative information produced by telcos. For all three stages of review, implementation and monitoring, Oftel will continue to ensure that progress towards the deadlines and outcomes set is maintained at an acceptable pace.
3.10 For the projects and programmes set out in Table 1 below, stakeholders are invited in to indicate where they would like to be involved.
Advisory Committees on Telecommunications and consumer experts
3.11 The Telecommunications Act 1984 establishes a number of committees (the ACTs) to give advice to the Director General, to represent the interests of consumers, and to give emphasis to especially those with least power. The Acts feed in suggestions to Oftel project managers to help Oftel focus on consumer concerns.
3.12 The ACTs respond to Oftel consultations, hold public meetings, meet the Director General and his senior staff, host seminars, participate in Oftel/industry working groups, liase with other consumer organisations, and publish their views via an independent web site (www.acts.org.uk). They are supported by secretariats in Cardiff, Belfast and Edinburgh, and a small unit within Oftel (see project C7).
3.13 The ACTs are independent of Oftel. Their annual objectives and work plans are therefore not incorporated in Oftelís Management Plan but are consulted on and published separately. For information please contact the ACT Secretariat on:
e-mail: email@example.com tel: 020 7634 8984.
Table 1- Proposed projects and programmes for 2003/4 ñ summary table as of October 2002
EU objectives: 1. Promoting competition, 2. Contribute to internal market development, 3. Promoting interests of citizens EU objectives 1, 2 and 3 drive lower level Oftel operational objectives as follows: |
1, 2 |
1, 2, 3 |
2, 3 |
1, 2 |
1, 2, 3 |
A. Effective competition |
B. Well informed consumers |
C. Adequately protected consumers |
D. Prevention of anti competitive practice |
E. Overall framework of regulation |
Reviews A1) EU Market reviews programme A2) Competition in mobile markets A3) Access to radio spectrum A4) Competition in broadcasting markets A5) Internet and e-commerce |
Reviews |
Reviews C1) Wholesale Line Rental C2) Consumer codes of practice |
Reviews D1) Financial Information Systems programme |
Reviews E1) Communications Bill E2) General Conditions of Entitlement E3) Research into consumer views E4) Industry data collection programme |
Implementation A6) Strategy, development & implementation of broadband networks A7) Numbering programme A8) Directory Inquiries Implementation A9) Carrier pre-selection A10) Number portability |
Implementation B1) Raising consumer awareness B2) Comparable Performance Indicators |
Implementation C3) Universal service obligation C4) Consumer representations C5) Metering and billing approval scheme C6) Network Resilience, Business Continuity and Emergency Communication Programme C7) Supporting the Advisory Committees on Telecoms |
Implementation D2) Compliance casework & dispute programme D3 Implementing accounting separation under the new directives |
Implementation E5) Developing international relations E6) Stakeholder relationships E7) Implementation of the new EU Directives E8) Ending the Licensing regime E9) Oftel Strategy implementation E10) Preparing for Ofcom E11) Better information on companies and markets E12) Communications Code and funds for liabilities |
Monitoring A11) Network interoperability programme |
Monitoring B3) Tariff transparency |
Monitoring C8) Input to other consumer protection legislation C9) Data protection in telecoms C10) Monitoring the Telecommunications Ombudsman Service |
Monitoring D4) Compliance Management Office Programme |
Monitoring |
Business support
F1) Human resources
F2) Learning and development programme
F3) Budget management programme
F4) Business Assurance programme
F5) IS and IT
F6) Communicating Oftel's work to external audiences
F7) Research and Information Unit
NB Q1 = Apr- June 2003 , Q2 = Jul- Sep 2003, Q3 = Oct- Dec 2003 , Q4 = Jan ñ Mar 2004
A1 EU market review programme
Programme manager:Objective: To ensure that the effective competition reviews required when new EU Directives come into force are carried out in a timely and efficient manner. Provide ongoing assistance to project managers to ensure that Oftel strategy is applied consistently across reviews and that individual reviews are carried out in an efficient manner, identifying synergies across reviews as appropriate.
A2 Competition in mobile markets
Programme Manager: Elaine Axby (tel: 020 7634 8915, e-mail: firstname.lastname@example.com)
Other contacts: Nic Green (tel: 020 7634 8891, e-mail: firstname.lastname@example.com) Chris Handley (tel: 020 7634 8863, e-mail: firstname.lastname@example.com) Michael Knowles (tel: 020 7634 8706, e-mail: firstname.lastname@example.com)
Objective: To ensure effective progress towards the development of competition in mobile markets.
A3 Access to the radio spectrum
Project Manager:
Roberto Ercole
(tel: 020 7634 8905, e-mail:
contact: Helen
Hicks (tel: 020 7634 5316, e-mail:
Objective: To work with the Radiocommunications Agency (RA) and the Department of Trade and Industry (DTI) policies to ensure that spectrum allocation policy and spectrum pricing promotes the economically efficient use of the radio spectrum; and to ensure spectrum is used to promote competition in the telecommunications market. To provide the competition advice regarding the use of radio spectrum as required by the Secretary of State under the 1984 Telecoms Act. By these actions promoting the interests of consumers in the management of the UK Radio Spectrum
A4 Competition in broadcasting markets
Doherty (tel:,020 7634 8828, e-mail:
Niblett (tel: 020 7634 8780, e-mail:
Patel (tel: 020 7634 8928, e-mail:
Naaz Rashid (tel: 020 7634 8849, e-mail:
Objective: To develop with Ofcom partners a policy framework for the promotion of competition in broadcasting markets and to increase understanding and awareness of Oftelís regulatory role eg in regard to conditional access and access control, Electronic Programme Guides (EPGs) and terrestrial transmission. This project will involve consolidation with the ITC on areas of overlapping responsibilities.
A5 Internet policy and narrowband access
Project Manager:Justin Moore (tel: 020 7634 8859, e-mail: firstname.lastname@example.com)
Other contact:Lucy Rhodes (tel: 020 7634 8836, e-mail: email@example.com)
Objective: To promote competition in narrowband Internet access and ensure that the UK regulatory environment is appropriate for the Internet.
A6 Strategy, development and implementation of broadband networks
Programme Manager:
Jim Niblett (tel: 020 7634 8750, e-mail:
Other Contact: Alistair Bridge (tel: 020 7634 8782, e-mail:
Objective: To promote effective and sustainable competition in the provision of broadband access and services within a regulatory framework that is conducive to further investment and more widespread roll-out.
A 7 Numbering Programme
Programme Manager: Ray Thornton (tel: 020 7634 8704, e-mail: firstname.lastname@example.com)
Project Managers:
Numbering Allocations:
Nicholas Good (tel: 020 7634 5333, e-mail:
Administration Alan
Pridmore (tel: 020 7634 8910, e-mail:
Numbering Liz
Greenberg (tel: 020 7634 8758, e-mail:
Rate Services:
Gavin Daykin (tel: 020 7634 5338, e-mail:
Objective: To enable consumers to benefit from competition and new services by ensuring the provision of adequate numbers and numbering ranges. To promote efficient number management by operators through number charging.
A8 Directory enquiries implementation
Project Manager:Caroline
Wallace (tel: 020 7634 8917, e-mail:
contact: Alex
Campbell (tel: 020 7634 8970, e-mail:
Objective: To assist the Industry in the implementation of the new arrangements for Directory Enquiries as set out in Oftelís September 2001 Statement.
A9 Carrier pre-selection (CPS)
Project Manager:
Caroline Wallace
(tel: 020 7634 8917 e-mail:
Other contact:
Alex Campbell
(tel: 020 7634 8970, e-mail:
Objective: To ensure the continued successful implementation of permanent CPS.
A10 Number portability
Manager: Warwick
Izzard (tel: 020 7634 8981, e-mail:
contact: Steve
Burniston (tel: 020 7634 5361, e-mail:
Objective: To promote effective and sustainable competition in the fixed and mobile markets by ensuring that customers can retain their number(s), if they wish to do so, when switching between providers of fixed or mobile services.
A11 Network interoperability programme
Manager: Bill
Hawkins(tel: 020 7634 8807, e-mail:
contact: Roy
Davies (tel: 020 7634 8906, e-mail:
Objective: To ensure that interoperability is effectively managed at network and customer interfaces, on the basis of co-regulation with the industry through the Network Interoperability Consultative Committee (NICC). This includes the harmonisation of UK network interfaces, the interconnection standards for networks and interoperability of support systems. It supports the work of various focus groups including the Operatorsí Policy Forum.
Well informed consumers
B1 Raising Consumer Awareness
Programme Manager:
Chris Rowsell (tel: 020 7634 8890, e-mail:
Other contacts:
Smithers (tel: 020 7634 8876, e-mail:
Objective: To co-ordinate and optimise Oftelís work in areas of consumer information including direct Oftel outputs and the encouragement of information from other sources.
B2 Comparable Performance Indicators
manager: Chris
Smithers (tel: 020 7634 8876, e-mail:
Other contact:
Chris Rowsell
(tel: 020 7634 8890, e-mail:
Objective: To enable customers to make well-informed buying decisions by ensuring the availability of information on the quality of service of fixed and mobile telephony companies. To improve the availability, visibility and accessibility of this information by working with the industry on a co-regulatory basis.
Tariff Transparency 2003-2004
Ritu Manhas (tel: 020 7634 5309
e-mail: firstname.lastname@example.com)
Other contacts: Chris Smithers (tel: 020 7634 8876, e-mail:
Objective: To ensure consumers are able to compare prices of telecoms services and develop policies that ensure consumers can readily identify the costs of their telephone services.
Adequately protected consumers
C1 Wholesale
Line Rental
Project Manager: Alan Pridmore(tel: 020 7634 8910, e-mail:
Other contact:
Steve Unger (tel:
020 7634 8879, e-mail:
email@example.com ) Gavin Daykin (tel 020 7634 5338, e-mail:
Objective: To develop a product specification for a commercially-viable, mass-market Wholesale Line Rental product and rules to protect consumers against misselling. To facilitate industry discussion and implementation of the product.
C2 Consumer Codes of Practice
Project Manager:
Chris Rowsell
(tel: 020 7634 8890, e-mail:
Other contacts:
Smithers (tel: 020 7634 8876, e-mail:
Objective: To ensure the production of effective consumer codes of practice on service delivery issues in line with the governmentís proposals in the White Paper on Communications and the draft Communications Bill.
C3 Universal service obligation (USO)
Project Manager:
Alan Pridmore
(tel: 020 7634 8910, e-mail:
Public payphones:Alex
Campbell (tel: 020 7634 8970, e-mail:
Disability issues:
Phillips (tel: 020 7634 8871, e-mail:
Objective: To ensure all consumers have access to those telecoms services which are: used by the majority and which are essential to full social and economic inclusion; made available to everybody upon reasonable request in an appropriate fashion and at an affordable price.
Designate USO provider(s) and implement new conditions of entitlement (Q2 2003/4); and
carry out review of USO Schemes (Q3 2003).
Project manager:
Bernice Head (tel: 020
7634 8710,e-mail: (firstname.lastname@example.com)
Other contacts:
Alistair Cox (tel: 020 7634 8733,e-mail:
firstname.lastname@example.com) Michelle Champion (tel: 020 7634 8712, e-mail:
Objective: To deal with effectively with consumer complaints and to encourage the industry to deal satisfactorily with consumer complaints in the first instance.
C5 Metering and billing scheme
Manager: Bill
Hawkins (tel: 020 7634 8807, e-mail:
Other contact: Roy
Davies (tel: 020 7634 8906,
e-mail: firstname.lastname@example.com)
Objective: To enhance consumer confidence in the accuracy of telephone bills and to give wider consumer protection by an effective Oftel metering and billing systems approval scheme. Last year the Scheme was extended to all significant operators, made available to major service providers and broadened in scope to include all material elements of bills as appropriate. It has subsequently been republished to align with the new European framework whilst maintaining continuity.
C6 Network Resilience, Business Continuity & Emergency Communication Programme
Project Manager:
Bill Hawkins(tel: 020 7634 8807, e-mail:
Other contact:
David Heath (tel:
020 7634 8818, e-mail:
Objective: To develop the processes to co-ordinate, as appropriate, the essential activities of the telecommunications industry during emergencies. Oftelís role is as a facilitator and communications channel between the industry and central government, rather than a directly operational one. Lines of communication will be established with both operators & other government departments. Reporting processes and business continuity plans will be developed in co-operation with the industry.
C7 Supporting the Advisory Committees on Telecommunications
Project Manager:
Paul Rogers (tel: 020 7634 8774, e-mail:
email@example.com )
Other contacts:
David Edwards (tel:020
7634 8773, e-mail:email@example.com)
Flora Pieris
(tel:020 7634 5301, e-mail:
Objective: To assist the Director General in his duty to promote the consumer interest, by ensuring that the Advisory Committees on Telecommunications (ACTs) are able to provide him with informed advice in accordance with their statutory duty.
C8 Input to other consumer protection legislation
Equality scheme
for Northern Ireland
Race equality scheme
Welsh language scheme
Project Manager:Neil Paterson (tel: 020 7634 8732, e-mail: email@example.com)
Other contacts:Julia Bradford (tel: 020 7634 8838, e-mail: email@example.com)
Objective: To ensure Oftel meets its statutory obligations in relation to non-telecoms specific legislation concerning consumer protection. Specifically to ensure that Oftel's equality scheme is approved by the Equality Commission for Northern Ireland, that Oftel prepares and implements a race equality scheme and that Oftel meets its statutory obligations under its Welsh language scheme.
Equality scheme for Northern Ireland
Race equality scheme
Welsh language scheme
C9 Data protection in telecoms
Paterson (tel: 020 7634 8732, e-mail:
Other contacts:Frank
Phillips (tel: 020 7634 8871, e-mail:
Objective: To ensure compliance with the requirements of the Communications Data Protection Directive. To ensure with DTI and the Information Commissioner that the UKís implementing regulations reflect experience gained to date under current Regulations.
C10 Monitoring the Telecommunications Ombudsman Service
Project Manager:
Chris Rowsell
(tel: 020 7634 8890, e-mail:
contacts: Chris
Handley (tel: 020 7634 8863, e-mail:
Objective: To ensure that a Telecommunications Ombudsman is established, and that it meets the UKís obligations for dispute resolution under the Universal Service and Usersí Rights Directive. The aim is to ensure the successful implementation of an independent industry-funded Ombudsman scheme, free of charge to consumers, which satisfies the criteria of independence, effectiveness, fairness, and public accountability. The Council of the Ombudsman Service and the Ombudsman are responsible for implementing the service itself.
Prevention of anti-competitive practice
D1 Financial information and systems programme
Project Manager:
Greenfield (tel: 020 7634 8734, e-mail:
Other contact:Dave
Robinson (tel: 020 7634 8933, e-mail:
Objective: To ensure that Oftel has access to relevant, accurate and timely financial and other information from operators necessary to ensure that competition and regulatory issues can be addressed effectively and efficiently. The provision of information by operators is necessary to ensure conformity with the provisions of, or decisions made in accordance with European Directives.
D2 Compliance Casework & Dispute Programme
Manager: Heather
Clayton (tel: 020 7634 8979, e-mail:
contacts for projects and own initiative investigations within the programme:
Geoff Brighton: NTS project (tel: 020 76348925, e-mail:
Lucy Rhodes: 2 Part Charging (tel: 020 7634 8836,
e-mail: email@example.com)
Kalpesh Brahmbhatt: Disputes in 4 months (tel: 020 76348826, e-mail:
Casework includes investigation of complaints and own initiative investigations under the Telecommunications Act, Competition Act, and other UK and EU legislation under which the Director General has powers and duties.
Objective: Prevent anti-competitive practices by efficiently resolving disputes and managing own initiative investigations. Ensure that Oftel continues to meets published targets for performance in investigation and meets the 4 month deadline specified by the new EU Directives for dispute resolution in 4 months by:
Programme Manager:Chris
Rowsell (tel: 020 7634 8890, e-mail:
Other contacts: Ruth
Ashworth (tel: 020 7634 8709, e-mail:
Objective: To implement accounting separation (AS) processes and obligations under the new European directives, where decided by the market reviews. This is necessary to ensure non-discrimination, cost-orientation and the prevention of unfair cross-subsidy by companies identified as having SMP in designated markets.
D4 Compliance Management Office Programme
Programme Manager:
Wood (tel: 020 7634 8854, e-mail:
Other Contacts:Keith
Loader (tel: 020 7634 8793, e-mail:
Peter Silverman (tel: 020 7634 8737, e-mail:
Maeve Gallagher (tel: 020 7634 8777, e-mail:
Objective: The Compliance Management Office (CMO) supports the running of the Compliance Directorate, including all aspects of casework quality, casework procedures, budget management and admin support. It is responsible for programmes on retail pricing and the monitoring of casework in the compliance phase. It is the first point of contact for Oftelís advice on mergers and takes the lead in developing and implementing competition policy issues. The CMO has close links with Regulatory Policy and is responsible for allocating work in Compliance across a range of issues.
Retail Pricing issues:
To analyse competition effects of BTís pricing proposals.
Compliance Monitoring Issues:
To ensure that compliance issues (such as casework in the compliance phase, obligations under licences etc) are effectively co-ordinated.
Casework Quality System:
To develop and operate a robust framework that enables compliance and competition casework to be conducted in an open, transparent and consistent manner.
Mergers advice:
To provide advice on mergers requests from OFT and monitor markets accordingly.
Admin support:
To provide support to the directorate on a range of admin functions
E1 Communications Bill
Neil Buckley (tel: 020 7634 5356, e-mail:
contact: Tim
Cross (tel: 020 7634 8798, e-mail:
Objective: To promote the development of a competitive market for converging services with appropriate consumer protection by working with Government and other stakeholders to update and reform the Telecommunications Act 1984 and the Broadcasting Acts.
E2 General conditions of entitlement
Project Manager:
Lucy Byers (tel: 020 7634 8892,
e-mail: firstname.lastname@example.com)
Other contact:
Neil Buckley
(tel: 020 7634 5356, e-mail:
Objective: To draft a set of general conditions of entitlement to replace existing licences for non-SMP operators, as part of the new Directive implementation process. Such conditions will apply to those who provide electronic communications networks and/or electronic communications services. The conditions will apply under the general authorisation that will be introduced by the Communications Bill or Statutory Instruments under the European Communities Act implementing the new draft Directives. The general rules will implement the requirements of the new draft Directives as well as the Communications Bill (if appropriate).
E3 Research into consumer views
Project Manager:
Metcalfe (tel: 020 7634 8918, e-mail:
Other contact:Lisa
Etwell (tel: 020 7634 8741, e-mail:
Objective: To support evidence based policy development, implementation, and compliance actions, by providing regular and comprehensive information on residential and business consumer behaviour, opinion, and use of telecoms.
E4 Industry data collection programme
Kenny Osborne (tel: 020 7634 8973, e-mail:
Other contacts:
Nick Collins (tel:
020 7634 8851, e-mail:
Robert Turner (tel: 020 7634 8778, e-mail:
Objective: To ensure that Oftel has sufficient information from the telecoms industry to allow evidence-based policy development by managing the regular collection and publication of accurate information from telecoms operators and service providers on an agreed range of services.
E5 Developing international relations
Project Manager:
Vince Affleck (tel:020 7634 8819, e-mail:
Other contacts:John
Bean (tel: 020 7634 8821, e-mail:
Rachel Coldeboeuf (tel: 020 7634 5306, e-mail:
Oliver (tel: 020 7634 8763, e-mail:
Objective: To improve customer outcomes in the UK by identifying and applying best regulatory practice from elsewhere in the world. To maintain Oftel's international reputation by promoting and explaining the work of Oftel internationally including transferring Oftel's experience of evolving regulation where appropriate.
Beyond Europe
E6 Stakeholder relationships
Programme Manager:
Large Business User Panel
Pridmore: (tel: 020 7634 8910, e-mail:
Business Task Force: Geoff
Delamere: (tel: 020 7634 8745, e-mail:
Objective: To ensure that Oftel makes full use of the knowledge and experience which stakeholders can bring to Oftelís decision making, and to ensure that stakeholder and Oftel resources are used efficiently and effectively.
E7 Implementation of the new EU Directives
Project Manager:Vince
Affleck (tel:020 7634 8819, e-mail:
Other contacts:Jim
Niblett (tel: 020 7634 8780, e-mail:
Michael Knowles (tel: 020 7634 8706, e-mail:
Objective: To ensure that Oftel implements the new EU Directives in a timely and efficient manner. Market reviews are covered separately in A1.
E8 Ending of the Individual licensing regime.
Project manager:
Davies (tel: 020 7634 8923, e-mail:
Other contact:
Laila Jhaveri (tel:
020 7634 5375, e-mail:
Objective: To implement fully the proposed EU Authorisation Directive, abolish the individual licensing regime, removing one of the potential barriers to entry. The ending of the individual licensing regime will obviate the need for network operators and service providers to apply for licences prior to the commencement of their operations. Class licences will also be revoked.
Create a new regime for administrative charges following the ending of individual licensing and the existing fee regime.
E9 Oftel Strategy implementation
Programme Manager: Geoff Delamere (tel: 020 7634 8745, e-mail: firstname.lastname@example.com)
Project Managers:
Implementation/Self & co-regulation Nic
Green (tel: 020 7634 8891, e-mail:
Plan John
Wimmer (tel: 020 7634 8742, e-mail:
Measurement Sarah
Evans (tel: 020 7634 5320, e-mail:
Available Consumer Savings Kenny
Osborne (tel: 020 7634 8973, e-mail:
Compliance strategy programme
Maeve Gallagher (tel: 020 7634 877, e-mail: firstname.lastname@example.com
Objective: To facilitate the implementation of Oftel's strategy as aligned with market circumstances and to prepare for integration with a wider Ofcom strategy.
E10 Preparing for Ofcom
Project Manager:
Objectives: work with other regulators and Government to support the development of the new Office for Communications (Ofcom) and ensure
i. that Ofcom has characteristics and methods which will deliver coherent economic regulation of converged services for the benefit of consumers;
ii. a smooth transition of Oftel responsibilities into the new organisation.
(This project deals primarily with the managerial implications and aspects of the new regime. Legislative issues are covered by project E1.)
E11 Better info on companies and markets
Manager: Justin
Silvertown (tel: 020 7634 8748, e-mail:
Other Contacts:
Despina Tasiopoulou
(tel: 020 7634 5336 e-mail:
firstname.lastname@example.com) Robert
Turner (tel: 020 7634 8778 e-mail:
Objective: Monitoring developments in telecoms and media companies and related markets, analysing their impact and disseminating these findings across Oftel/Ofcom. Assessing industry news, company announcements and reports, research by financial analysts, consultants and industry groups, direct meetings with companies.
Outputs will be under review to ensure responsiveness to Oftel/Ofcom needs. Currently to initially include:
E12 Electronic Communications Code and funds for liabilities:
Project manager:
Peter Davies (tel: 020 7634 8923, e-mail:
Laila Jhaveri (tel: 020 7634,(no telephone number as yet. e-mail:
Objective: To develop Oftelís thinking on how Ofcom will grant rights to make use of the new Electronic Communications Code. It is intended also to ensure the continuation of a viable and practicable scheme to facilitate the creation of communications infrastructure and to introduce a new scheme for funds for liabilities.
Internal business support projects and programmes
F1 Human Resources
Programme Manager:
Ros Badger (tel: 020 7634 8783, e-mail:
contact: Gill
Loader (tel: 020 7634 8789, e-mail:
Objective: To ensure that Oftel implements effective strategies, policies and procedures for the recruitment, retention, recognition and reward of Oftel staff. The new system of performance and reward is aligned with both Oftelís business needs and its employeeís aspirations and aims to maintain continuity and equality of staff in the lead up to Ofcom and beyond.
F2 Learning and Development Programme
Programme Manager: Carol Coyne (tel: 020 7634 8997, e-mail: email@example.com)
Objective: To ensure that Oftel can meet its business objectives by providing high quality learning opportunities accessible to every member of Oftel staff.
F3 Budget management programme
Programme manager: Paul Heseltine (tel: 020 7634 8791, e-mail: email@example.com)
Objective: To provide an effective finance and accounting service to the department.
F4 Business Assurance Programme
Programme Manager Ray Thornton (tel: 020 7634 8704, e-mail: firstname.lastname@example.com)
Project Managers:
Disaster Recovery and Contingency: Hari Bains (tel: 020 7634 8796, e-mail: firstname.lastname@example.com
Supporting Project and Case Managers Rob Jex (tel: 020 7634 5350, e-mail: firstname.lastname@example.com )
Objective: This programme covers the need to ensure that Oftelís processes and procedures are clearly identified and defined, supporting the delivery of better regulation within the organisation. It specifically supports the Statement of Internal Controls made by the Director General in the annual accounts each year.
The programme ostensibly covers all areas of operation in all directorates but focuses on Oftel-wide process and procedure. Specific areas to be covered by this programme include:
Objective: To continue to provide efficient and effective Information Systems which support Oftel's business needs and plan for the transition to Ofcom.
F6 Communicating Oftelís work to external audiences
Programme Manager:Duncan
Stroud (tel: 020 7634 8750, e-mail:
Other contacts:Rachel
Millns (tel: 020 7634 8752, e-mail:
Objective: To ensure that Oftelís work is communicated quickly and clearly to external audiences including the public, industry and media.
F7 Research and Information Unit
Programme Manager: Anne Cameron (tel:020 7634 8958 , e-mail: firstname.lastname@example.com)
Other Contacts: Hari Bains (tel:020 7634 8796, e-mail: email@example.com) Neil Paterson (tel:020 7634 8732, e-mail: email@example.com) Rachel Reeve (tel: 020 7634 8762, e-mail: email@example.com)
Objective: Ensure that Oftel complies with, amongst others, the requirements of Data Protection, Intellectual Copyright and Freedom of Information. To manage Oftel's knowledge assets, ensuring continuity. To develop and impose Metadata standards, in line with Cabinet Office guidelines, that will help produce more accurate search results on both Internet and intranet.
4.2 The next financial year (April 2003 ñ March 2004) straddles two regimes for the recovery of the costs of the National Regulatory Authorities, namely the existing Licensing Directive (which is repealed on 24 July 2003), and the new Directives, which take effect from 25 July 2003. For the period up to 24 July 2003, licence fees will continue to be payable. However under Article 12 of the new EC Authorisation Directive (Directive 2002/20) and following abolition of the licensing regime on 24 July 2003, costs will be recovered instead from those operating under a general authorisation. Full details of Oftelís proposed new charging regime for 2003ñ04 will be set out in a Consultation Document.
4.3 Based on Oftelís current expenditure plans for 2003-04, some £0.7 million will be sought from Government sources to meet costs for those areas of work that cannot be funded under the charging regime.
4.4 The total administration costs of Oftel in 2002ñ03 are forecast at £19.5 million (2001ñ02 £17 million), an increase of some 14 per cent. For 2003ñ04 Oftelís budget plans provide for total administration costs of £20.1 million, representing the smallest planned increase (3.3 per cent) for many years.
Table 1: Trends in Oftelís spending: £í000
Operating Costs |
1999ñ2000 |
2000ñ01 |
2001ñ02 |
2002ñ03 |
2003ñ04 |
Staffing |
6,783 |
7,671 |
9,401 |
10,741 |
11,797 |
Other administration costs |
5,726 |
5,994 |
7,637 |
8,710 |
8,297 |
Total |
12,509 |
13,665 |
17,038 |
19,451 |
20,094 |
Change (%) |
16.5 |
9.2 |
24.7 |
14.2 |
3.3 |
4.5 Oftelís financing regime changed following acceptance of most of the recommendations in the 2001 report to HM Treasury on the External Efficiency Review of the Utility Regulators. The new regime, which was introduced in 2002 provides for licence holders, consumer committees and other interested parties to feed in any practical suggestions they may have for efficiency improvements as well as comments on Oftelís expenditure plans. In response, Oftel implemented an Action Plan to take forward the key actions. The major action points included a commitment to:
4.6 Oftel incorporated these proposals as part of its consultation process last year. Our consultation process has also involved early notice of key issues to stakeholders through a meeting of the Oftel Forum in October 2002. A more detailed update of progress against Oftelís action plan will be included in Oftelís 2002 Annual Report to be published in the Spring. The Annual Report will continue to be the main vehicle for reporting Oftelís performance against its Service Delivery Agreement (SDA) targets.
4.7 The following tables provide an outline of Oftelís budget for 2002-03 and its proposals for 2003-04.
Table 2: Summary of expenditure and outturns £
d |
2002-03 |
2002-03 |
2003-04 |
d |
Expenditure type (£) |
Initial Budget |
Revised Budget * |
Planned expenditure |
Administration Costs (ACs) |
a a |
a |
a |
q |
Pay |
10,725,801 |
10,725,801 |
11,797,224 |
q |
Consultancy |
2,180,080 |
2,763,376 |
2,246,700 |
q |
Rent (Ludgate Hill / Shoe Lane) |
1,429,985 |
1,429,985 |
1,437,760 |
Training (PRTU) |
324,000 |
318,000 |
353,850 |
q |
Recruitment |
174,000 |
169,000 |
160,000 |
q |
Press/Publicity |
283,185 |
283,185 |
270,000 |
q |
Other AC's |
2,331,901 |
2,030,653 |
2,177,054 |
Total ACs |
17,157,352 |
17,720,000 |
18,442,588 |
Other Current |
a |
aa |
a |
a |
Twinning with Poland |
84,000 |
234,000 |
0 |
a |
ACTs |
516,000 |
516,000 |
526,697 |
a |
Litigation |
0 |
0 |
100,000 |
Total Other Current |
600,000 |
750,000 |
626,697 |
Notional Costs [depreciation] |
981,000 |
981,000 |
1,024,500 |
Gross Total |
18,738,352 |
19,451,000 |
20,093,785 |
h |
h |
h |
h |
Capital |
a a |
a |
a |
a |
Furniture/Office Equipment |
50,000 |
50,000 |
17,000 |
a |
715,900 |
715,900 |
476,687 |
Total Capital |
765,900 |
765,900 |
493,687 |
* Budget revised following Parliamentary approval of Oftelís Winter Supplementary Estimate (November 2002).
4.8 These costs can be split by Directorate as follows:
Table 3: Planned expenditure by Directorate for 2003ñ04
£ |
Regulatory Policy |
Compliance |
Business Support & Top Management Team |
Total |
2002-03 Rev. Budget |
7,004,768 |
5,471,477 |
6,974,755 |
19,451,000 |
2003-04 Bid |
6,650,061 |
6,013,038 |
7,430,686 |
20,093,785 |
Budget by main category of plan
4.9 The following tables provide an approximate breakdown and costings of main resources (salaries, consultancy) of Oftelís external facing work programme (ie all work described in chapter 3 excluding Internal projects/programmes i.e. projects F1-F7) calculated through the grouping of projects/programmes in relation to Oftelís high level objectives and by type of activity as set out in Chapter 3, for the years 2002-03, and the proposed work programme for 2003-04. These tables have been formulated through internal consultation with Oftel project/programme managers and by a ëtop downí analysis of Oftelís work programme. Whilst Oftel needs to remain flexible in terms of resource allocation to respond to emerging issues and priorities, these tables have been developed so as to provide stakeholders with an initial approximation of how Oftel intends to commit its resources over 2003-04.
Table 4: Budget 2002ñ03 ñ Strategy by Objective
£m |
Total |
Review |
2.1 |
0 |
0.6 |
0.2 |
1.0 |
3.9 |
Implementation |
1.8 |
0.3 |
1.8 |
1.3 |
1.4 |
6.8 |
Monitoring |
0.3 |
0 |
0.1 |
0.2 |
0 |
0.6 |
totals |
4.2 |
0.3 |
2.5 |
1.7 |
2.4 |
11.1 |
Table 5: Budget 2003ñ04 ñ Strategy by Objective
£m |
Total |
Review |
2.2 |
0 |
0.5 |
0.2 |
1.2 |
4.1 |
Implementation |
1.9 |
0.2 |
1.9 |
1.5 |
1.2 |
6.7 |
Monitoring |
0.3 |
0.1 |
0.1 |
0.5 |
0 |
1.0 |
Totals |
4.4 |
0.3 |
2.5 |
2.2 |
2.4 |
11.8 |
4.10 Overall spend on projects & programmes is planned to increase by around 6% in 2003ñ04 compared to 2002ñ03. The major factors explaining the variance by category of work from 2002ñ03, can be determined as, increases in salaries (discussed below), the focus and changes in Oftel activity. The major increase by category of work from 2002ñ03 relates to 'prevention of anti-competitive practice'. This increase is due primarily to a re-allocation in consultancy of nearly £400K. The restructuring of the Compliance Directorate in 2002 has led to a number of budget areas being consolidated under 'prevention of anti-competitve practice'. Major areas of this consultancy budget include - extending or modifying existing cost models to support investigations and casework, quality assurance audit work on cost price calculations, benchmarking studies, ad hoc market research for Competition Act cases and the consolidation of legal advice relating to casework.
Main explanatory factors in 2003-04 budget increase
Recruiting and retaining staff
4.11 Oftel has continued to experience some difficulties in recruiting staff as the utility and communications regulators have to compete head on with private sector companies, with salaries to match for highly prized skills in a key area of the UK economy. However there is some evidence that Oftelís Performance and Reward System introduced in 2001 has made a difference, for example improving our ability to recruit to some previously hard to fill specialist and professional vacancies.
4.12 Staff turnover dropped to16% in 2001 but turnover is increasing and the forecast outturn for 2002 is 21% against an average turnover of some 6 per cent across the whole of the Civil Service (2001 statistics).
4.13 Better pay and prospects are the main reasons given for leaving. With the creation of OFCOM expected in 2003, retention remains a key issue. The risk of a return to even higher turnover rates may increase during 2003-04 as we work towards transition to the new body.
4.14 In response to the high turnover of staff, pay had gradually been increased as far as possible within public sector pay constraints to reflect (but not match) market rates. As can be seen from the tables above, planned expenditure on the paybill for 2003ñ04 is significantly higher than current year forecast spend. This reflects not only the pay settlement sought to provide for the operation of the Performance and Reward System in its final year but also to meet the costs of the continuing change in the staff skills mix. Oftel has been reducing the number of support staff and taking on more senior and professional staff to handle the growth in complexity of regulatory work and demands for the speedier resolution of complaints and casework.
4.15 The following table identifies projects/programmes costing more than £250K reflecting approximate staff and consultancy costs.
Table 6
Projects/programmes costing over £250k |
A1 EU Market reviews |
A6 Strategy and development & implementation of broadband networks |
A7 Numbering Programme |
C1 Wholesale Line Rental |
C4 Consumer representation |
D2 Compliance casework and dispute programme |
D4 Compliance management office programme |
E9 Oftel strategy implementation programme |
E3 Research into Consumer Views |
Staff Numbers
4.16 Planned staff numbers for 2003ñ04 are as follows:
Table 7
rr |
Plans 2002ñ03 |
Plans 2003ñ04 |
Civil Service (full time equivalents) |
240 |
239 |
4.17 Oftelís actual forecast outturn for 2002ñ03 is 234 full time equivalents.
4.18 The Director General of Telecommunications is the Accounting Officer for Oftel.
4.19 Oftelís accounts are audited by the National Audit Office (Comptroller and Auditor General) and an internal audit service is provided by the Department of Trade and Industry. Oftelís Audit Committee has an independent external chairman and the Committee meets at least three times a year with National Audit Office officials and Oftelís head of Internal Audit in attendance.
4.20 Oftel also has a Remuneration Committee with an independent external chairman and member in addition to a single Oftel committee member.
Consultation process and questions
5.1 This chapter sets out:
Consultation questions
5.2 Consultees are asked to respond to the following questions:
Q1 Do you agree with the focus of the plan for 2003-4 in light of market and regulatory developments as set out in Chapter 1?
Q2 Do you consider Chapter 2 covers the most appropriate areas for Oftel to be looking forward to Ofcom i.e. improving regulatory processes and identifying major policy opportunities?
Q3 Do you think Oftel's proposed detailed work plan for 2003/4, as set out in Chapter 3 covers the key areas that need to be addressed?
Q4 If not, what areas do you consider should have greater priority?
Q5 Do you have any comments on where resources are focused or where efficiency improvements could be made?
Consultations to date
Oftel Forum
5.3 On October 25 2002 Oftel Forum , stakeholders were split into groups and held a general discussion on preparatory consultation questions for the management plan. The following consists of the main points that came out of the discussions.
Q1: What do you think Oftel should be taking into account in preparing its 2003-4 plan?
5.4 There were a number of issues raised by the discussion groups. It was stated that the importance e-commerce and the advances in telecommunications to the general public needs greater recognition. There was concern that some sections of the community may become isolated from these benefits. As such the extent of USO obligations may require further thought. Codes of Practice (COP) were identified as being an area that would receive greater prominence in 2003-4. The comment was made that Wholesale Line Rental (WLR) was an area, which would require adequate resourcing during implementation to ensure effective product delivery. As regards the transition to Ofcom, it was stated that it would be important for Oftel to communicate to industry and other stakeholders which Oftel staff will be involved in Oftelís current work programme, so as to ensure continuity.
Oftel comment
5.5 Oftel fully acknowledges the importance of adequate resources and commitment for the implementation of WLR. This commitment is recognised in Oftelís Condoc on WLR published in November 2002. As regards USO obligations, Oftel is aware of the increasing importance e-commerce and telecommunications in peoples lives. Monitoring the scope and operation USO obligations to ensure that sections of society do not become unfairly disadvantaged in terms of having access to telecommunications technology is an ongoing process of review. Oftel recognises the importance of continuity in terms of its work programme during the transition to Ofcom. The need for the proper management of resources and the development of strategies to achieve Oftelís objectives in areas like WLR is recognised in chapter 2. Keeping the stakeholders informed as to which staff are working on current Oftel projects/programmes will be a high priority for Oftel in the lead up to Ofcom.
Q2: Do we need to focus our regulatory efforts more effectively, and if so how?
5.6 Many of the comments from the group focused on issues that Oftel needs to take into consideration in the lead up to Ofcom in relation to the ACTs. The comment was made that Oftel needs to continue to engage the regions during the formation Ofcom, especially as Ofcom may not have regional secretariats. Maintaining a regional perspective was seen as important so as to ensure that regional issues are not overlooked, as was ensuring that policy issues of concern to the ACTs continue to receive prominence both prior to and during Ofcomís formation. It will be important for Oftel to keep consumer representatives and the ACTs informed as to where organisationally and in what forums regional and other consumer policy issues will be addressed in Ofcom.
Oftel comment
5.7 Oftel recognises the importance of consulting with and keeping the ACTs informed in the lead up to Ofcom. Earlier this year Oftel re-issued guidance to project/programme managers on the importance of consulting with the ACTs in relation to any work with a consumer focus. Oftel will continue to work with the ACTs and seek their advice in the lead up to Ofcom. As regards the regions, Oftel will continue to engage with the ACTs to gain their perspectives on regional telecoms issues. Whilst Ofcom may not have regional secretariats, the Consumer Panel will however have board members representing regional areas.
Q3: What about beyond Oftel ñ what should happen now and in 2003-4 to ensure Ofcom gives priority to the most relevant issues?
5.8 The group made a number of points on this question. It was felt that Oftel needs to identify what is good and what is bad in its organisational culture and work practices. Oftel also needs to take account of any ëlessons learntí in regards to achieving its objectives and getting the right focus and identifying most relevant issues in the lead up to Ofcom. Oftel needs to identify its strengths and weaknesses i.e. strategies and structures, for example it was raised that Oftelís has good consultation procedures, but could learn from practices like the road shows of other regulators.
5.9 The comment was made that Oftel needs to focus more on identifying emerging issues. With the creation of Ofcom this will become increasingly important. Consumer input was identified as being important along with a greater use of consumer detriment analysis as regards complaint handling. Some stakeholders felt that there would be a greater use of self and co-regulation and Codes of Practice in the future, as such the issues of consumer resourcing needed to be addressed.
5.10 It was also felt that Competition Act decisions need to be speedier and that this will be an issue for Ofcom. The need for strong evidence based regulation was also seen as an important issue to take into Ofcom.
Oftel comment
5.11 Oftel recognises the need to retain what is best in its organisational culture and work practices to ensure that Ofcom prioritises the most relevant issues in the telecommunications sector. Ensuring that Oftelís experiences and that any "lessons learnt" are appreciated and transferred into the new organisation is a high priority for Oftel, as is ensuring that Oftelís work programmes continue to run effectively, transparently, efficiently and receive adequate resourcing during the transition period. Oftel is also interested in learning from its fellow regulators any successful examples of ëbest practiceí.
5.12 Chapter 2 of the consultation document highlights the need for efficient, inclusive and accountable regulatory processes that are transparent to stakeholders as well as the need for a greater targeting of regulatory to achieve outcomes for consumers. In particular, in terms of continuing to develop regulatory processes to take into Ofcom, Oftel has identified: actions to improve the focus of regulation i.e. dispute resolution, competition cases & consumer initiatives, and actions that provide incentives to improve the speed with which regulatory responses to problems are developed and implemented, as areas that could be further developed by Ofcom.
5.13 Oftel appreciates the need for adequate consumer resourcing to ensure the proper functioning of any self & co-regulatory initiatives and that this will be an issue for Ofcomís consumer panel. Oftel is committed to the use of consumer detriment analysis it its decision making and will take this focus into Ofcom. Oftel continues work to ensure that its decision making procedures in relation to Competition Act cases are as efficient as possible. Oftel recognises the desire amongst industry for speedier decision-making, however Oftel must balance the desire for quicker decision making with the need for providing transparent due process. Evidence based regulation has always been at the heart of Oftelís work and will be continue to be a priority as Oftel transfers its functions into Ofcom.
How to make comments on the questions raised in this consultation document
5.14 Oftel is publishing this consultation document so that interested parties may comment on the issues which it addresses. The closing date for submitting comments is 31 January 2003.
5.15 Where possible, comments, and comments on comments, should be made in writing and sent by e-mail to email@example.com. However, copies may also be posted or faxed to the address below. If any interested parties are unable to respond in one of these ways, they should discuss alternatives with the Oftel manager named below:
John Wimmer
50 Ludgate Hill
London EC4M 7JJ
tel: 020 7634 8742
fax: 020 7634 8757
e-mail: email@example.com
5.16 This document can be viewed in the publications section of Oftelís website at www.oftel.gov.uk/publications/about_oftel/index.htm.
5.17 Alternative formats such as large print, Braille, disc and audio cassette can be made available on request. Please contact Oftelís Research and Information Unit by phoning 020 7634 8761 or by sending an e-mail to firstname.lastname@example.com.
Publication of comments made by stakeholders
5.18 On this occasion, Oftel is not programming a formal period during which interested parties may comment on the responses made by others. Nevertheless, in the interests of transparency, all non confidential comments and comments-on-comments, will be published. Respondents should separate out any confidential material into a confidential annex which is clearly identified as containing confidential material. Oftel will take steps to protect the confidentiality of all such material from the moment that it is received at Oftelís offices. However, in the interests of transparency, respondents should avoid applying confidential markings wherever possible.
5.19 Non-confidential responses can be viewed on Oftelís website in the publications section under ëResponses to Oftel consultationsí. They can also be viewed at Oftelís Research and Information Unit. Appointments must be made in advance by phoning 020 7634 8761 or sending an e-mail: to firstname.lastname@example.com.
e-mail notifications
5.20 Oftel has a free e-mail based mailing list to help people stay informed about the work that Oftel is doing. Each time an Oftel document is published and placed on Oftelís website at www.oftel.gov.uk, subscribers to the list receive an e-mail alert. To register, please go to the ëWhatís Newí section of the website and access the electronic form.
Consultation criteria
5.21 Oftel considers
that this document meets the Cabinet Office code of practice on written
consultation documents except for the period of consultation which is
explained below. The code is reproduced below for convenienc
e. If you have any comments or complaints about this consultation process
please contact:
Robert JexOftel
Co-ordinator for the Code of Practice
50 Ludgate Hill
London EC4M 7JJ
tel: 020 7634 5350
fax: 020 7634 8943
e-mail: email@example.com
5.22 Timing of consultation should be built into the planning process for a policy (including legislation) or service from the start, so that it has the best prospect of improving the proposals concerned, and so that sufficient time is left for it at each stage.
5.23 It should be clear who is being consulted, about what questions, in what timescale and for what purpose.
5.24 Documents should be made widely available, with the fullest use of electronic means (though not to the exclusion of others), and effectively drawn to the attention of all interested groups and individuals.
5.25 Sufficient time should be allowed for considered responses from all groups with an interest. Twelve weeks should be the standard minimum period for consultation (see note below for why a shorter period has been chosen for this consultation).
5.26 Responses should be carefully and open-mindedly analysed, and the results made widely available, with an account of the views expressed, and reasons for decisions finally taken.
5.27 Departments should monitor and evaluate consultations, designating a consultation co-ordinator who will ensure that all lessons are disseminated.
5.28 The formal consultation period for this document is 6 weeks. The shorter consultation period is justified on the following grounds:
5.29 The following organisations are being consulted:
List of projects in alphabetical order with project/programme reference
Access to radio spectrum |
Better information on companies and markets |
Carrier pre-selection |
Communications Bill |
Communications Code and funds for liabilities |
Comparable Performance Indicators |
Competition in broadcasting markets |
Competition in mobile markets |
Compliance Management Office Programme |
Compliance Casework & dispute programme |
Consumer codes of practice |
Consumer representations |
Data protection in telecoms |
Developing international relations |
Directory Inquiries Implementation |
Ending the Licensing regime |
EU Market reviews programme |
Financial Information Systems |
General Conditions of Entitlement |
Implementation of the new EU Directives |
Implementing Accounting Separation under the new Directives |
Industry data collection |
Input to other consumer protection legislation |
Internet and e-commerce |
Metering and billing approval scheme |
Monitoring the Telecommunications Ombudsman Service |
Network interoperability |
Network Resilience, Business Continuity and Emergency Communication Programme |
Number portability |
Numbering |
Oftel Strategy implementation |
Preparing for Ofcom |
Raising consumer awareness |
Research into consumer views |
Stakeholder relationships |
Strategy and development & implementation of Broadband networks |
Supporting the Advisory Committees on Telecoms |
Tariff transparency |
Universal service obligation |
Wholesale Line Rental |
Principles |
All objectives 1. Regulate only where it is likely to bring a net benefit to consumers. Keep regulation to the minimum necessary to obtain appropriate outcomes. Assess, in a transparent, accountable and proportionate manner, the advantages and disadvantages of targeted and feasible regulatory options, for consumers and suppliers and other relevant parties, when considering adding to, reducing or retaining regulation. Measure and assess impact of regulatory actions. |
Effective competition ñ benefiting consumers 2. Define market and assess if market power exists in accordance with competition law. Only regulate if there is market power and likelihood of abuse and do so by taking appropriate and proportionate action. Where competition is increasing but not yet effective, promotion of competition at all levels of network and services is acceptable so long as:
Regulation to promote competition/protect consumers should include consideration, of all options as appropriate, not just behavioural options. Such regulation should become progressively ëlighter touchí as the market gets near to effective competition while recognising the increasing complexity of networks and services may require more specific intervention on occasion to enable market entry. |
3. Cease to promote competition through regulation when there is effective competition. Assessment of effective competition to be based on standard competition analysis that takes account of benefits obtained by consumers and is fully aligned with EU market analysis guidelines. |
Well informed consumers 4. Encourage greater awareness of choice of services and supplies on the part of consumers so they are able to make competition effective and to rely less on regulation. Rely on standard consumer legislation wherever this is sufficient and encourage the use of codes of practice by individual firms and the industry collectively to make this effective for electronic communications consumers. |
5. Encourage industry to meet the needs of consumers rather than relying on regulation to meet these needs and encourage third party providers to produce information to help consumers choose. |
Adequately protected consumers 6. Where competition cannot provide agreed services to all at affordable prices, regulate (using 'non-market' review guidelines once published to ensure consistency and relevance of approach) to ensure there is such provision in a way that minimises distorting effects. Geographically averaged prices should be used only for supply of basic service to ensure network access by all. |
7. Control of prices should be limited to those areas where competition, assessed on basis set out in Principle 2 above, is ineffective now or in prospect (four years +). |
8. Where competition is not in prospect or the market, of itself, will not meet consumer needs, regulate to replicate efficient outcomes subject to not undermining incentives to innovate as set out in the Access and Interconnection Directive guidelines. Ensure resources are managed efficiently but seek market solutions wherever feasible. Monitor extent of consumer detriment, using a consistent basis to help assess need for and impact of regulatory intervention. Attempt to minimise disruption arising from suppliers rapidly exiting from the market. |
9. Encourage industry, wherever feasible to work with consumers, to regulate itself in those areas where a common approach is necessary to meet consumer needs ie either to provide service or for the development of competition. Encourage focus on areas where sufficient common interest (typically consumer information and protection) and look at different ways of pursuing co-regulation appropriate to circumstances, sometimes in conjunction with formal regulation as necessary. Encourage initiatives that are focused on producing tangible outputs, are time limited in terms of development effort and make efficient and proportionate use of resources of participants. Any Oftel role to focus on facilitating involvement of consumer groups and suppliers and to act as a fallback option in exceptional circumstances. |
Prevention of anti competitive practice 10. Rely on competition legislation for tackling anti-competitive behaviour wherever possible and appropriate: ex ante obligations may be used to promote competition where competition legislation is inappropriate (primarily in relation to access and interconnection disputes) and where there is market power and a material effect on competition: where such means are used, be explicit why and for what purpose. |
This annex updates the information published in last years management plan and the 2001 annual report. The intention is to capture Oftel's main activities and decisions as reflected in its publications and press releases. The presentation of this material has been further developed since the annual report with further sub-categorisation as follows:
April 2002 - October 2002 (including major cases)
Removal of regulation
Oftel/Industry initiatives
Oftel guidance / aids to transparency
Formal regulation
Other significant actions that do not fit readily fit into the above categories
Project Name |
Issue Consultation Document |
Issue Statement |
R1 - Fixed wholesale call origination review |
Feb 03 |
July 03 |
R2 - Wholesale narrowband internet termination review |
Feb 03 |
July 03 |
R3 - Call Termination (fixed) |
Feb 03 |
- |
R4 - Retail Price Control Review |
Feb 03 |
July 03 |
R5 - Broadband Market Review |
Feb/March 03 |
July 03 |
p | p | p |
R7A - Terrestrial Transmission |
Feb 03 |
July 03 |
R7 - Mobile |
Feb 03 |
July 03 |
Feb 03 |
July 03 |
Note: Timings are subject to the Commission Recommendation on relevant product and service markets.
The tables below indicate when existing consumer protection policy areas will be subject to review. The Table 1 lists projects & programmes that Oftel intends to give priority to reviewing in 2003-4*.Table 2 lists projects/programmes with later review dates or where review timings are still to be determined. The timetable has been split this way so as to give stakeholders indication of Oftelís priorities as regards consumer protection policy review. The timetable also includes activities that will not formally be a CPPR, i.e. Ombudsman Service compliance check on ADR mechanisms. It should however be noted that this in an indicative timetable only and may be subject to revision.
Table 1
Table 2
*The first phase of a CPPR will include a feasibility study of the scope and complexity of a policy review area including pre-consultation review work, where appropriate this may lead to a change in the review timetable and extent of the review to be undertaken.
** Universal Service Obligations cover a range of issues, as such any reviews undertaken would cover specific and appropriate areas of policy within the context of fulfilling USO obligations
*** The Welsh Language Act & Northern Ireland Act require regular monitoring and review of both schemes which is detailed in the management plan. Whilst the existence of the schemes is not subject to review, their effectiveness will be subject to review.
Note to table The above list is based on projects and programmes appearing in Oftel's 2003-04 -management plan. It does not include areas of work, which are: primarily market review based; or relate to the overall framework of regulation; or, comprise a one-off action which is not suited to a cyclical review process.
Over the last few years Oftel has considerably expanded and developed its research programme, consisting continuous quarterly surveys with consumers and SMEs, supplemented with a variety of ad hoc projects, contributing to the evidence base for Oftelís decision making.
Reference to the ëaverageí consumer is a useful way of summarising the evidence and providing a general understanding of behaviour, but consumers exhibit a wide range of behaviours which can be obscured in this approach. Oftel has been developing a more ëholisticí approach to examining consumer behaviour, segmenting consumers into different groups, providing greater insight into different needs and issues and enabling more individualised solutions to be sought and implemented. This is a technique that Oftel regularly employs for specific market segments and has now extended to the telecoms market as a whole, offering a cross-market perspective to assist set the tone for policy making in the run up and transition to Ofcom. Consumers were segmented on their usage and attitude towards telecoms, from which six main groups were distinguishable (see group highlights below).
This tool can assist Oftelís decision making in a number of ways:
Main messages
One of the main benefits of this type of analysis is the ability to differentiate between customer types and examine individual group issues. It is this granular level that Oftel shall be employing in its work, but at a more generic level it is useful to summarise some of the main messages that emerge from across the groups.
Advanced users, 2% homes, Ω million
Essence ñ love telecoms and technologies. Are the first adopters of everything eg have broadband, WAP phones etc and not just for the sake of having it, they use it / genuine interest in it, but insufficient proportion of the population to drive competition. Quality and having the latest features are more important than price, although some price sensitivity. Heavy users and spenders, fairly sophisticated usage and demanding consumers, good awareness and making use of choices. Satisfied with their services, the information and most of the choices available.
Who - younger / middle aged men, single / with partner, no kids, own home, working, high income, AB social groups
Progressive quality seekers, 34% homes, 8.5 million
Essence ñ have a variety of telecoms services, heavy users, and their use / attitude goes slightly beyond functional need. Cost and quality equally important, want best not cheapest deal. Interested in getting a better deal, changing / developing their usage, have switched suppliers and / or packages. Brand image is vital and theyíre prepared to a pay a premium to guarantee quality and reliability but are not entirely happy about having to do so. Higher than average awareness of choices though some areas for improvement, greater use of supplier information sources (rather than word of mouth).
Who - younger to middle aged, married / with partner and with children, working, slightly higher than average income, ABC1
Passive basic users, 41% homes, 10.25 million
Essence ñ fairly heavy but basic telecoms users, not very interested in telecoms / switching to get a better deal. Never switched supplier ñ no perceived need, satisfied with current services, perceptions of insufficient savings. Average awareness of choices, decisions make on the cost and recommendations from others, after initial adoption little interest in switching to a better deal.
Who - closest to the ëaverageí consumer demographic profile ñ average spread across most factors. The only distinction is a marginally higher proportion working, and hence slightly lower than average aged 55+ and DE.
Contented light users, 20% homes, 5 million
Essence ñ basic and light telecoms users. Have either a fixed phone or a mobile and little interest in having much else. Light spenders, less likely than average to have switched - did not perceive significant barriers to switching ñ are satisfied with their current suppliers and saw insufficient savings to merit switching. Few use Internet anywhere and none had it at home, low intention to adopt more telecoms ñ lack of need, few saw cost as a barrier.
Who - middle aged / older, retired, significant proportions living alone with no kids at home, lower income / C2DE, living in urban areas of medium-high deprivation.
Disadvantaged by cost, 3% homes, 2/3 million
Essence ñ want to make greater use of telecoms but cost barriers to doing so. Ability to control and manage costs is vital. Have only a mobile or no phone at all, but would like more. Few have Internet at home but a third use it elsewhere ñ cost barriers to home access. The ability to control and manage costs is the main issue for this group and they will pay a premium in order to retain this flexibility and control.
Who - mainly young, working in low paid jobs or unemployed, low income, DE social groups, living in rented accommodation (largely state), in deprived urban areas, single and/or with young children
Donít want home telephony, <1% homes, 60,000
Essence - Infrequent telecoms users, donít have any home telephony, claim donít / wouldnít use it enough to have a fixed or mobile phone, use payphone or someone elseís phone if need to make a call.
Who - older / retired, and/or disabled, live in rented accommodation, often alone, no kids, in urban deprived areas, low income, C2DE.