Ofcom Decision on BT Openreach – A Step in the Right Direction or A Golden Opportunity Missed

The Openreach Decision

Today, February 25th, Ofcom made the announcement that they would not be splitting BT Openreach away from BT despite finding that “Openreach still has an incentive to make decisions in the interests of BT, rather than BT’s competitors, which can lead to competition problems”. Their solution to change the Governance model so that Openreach serves all wholesale customers equally and consults them all over investment decisions. A step in the right direction but Ofcom should have gone much further.

This will now await more detailed proposals later this year and they have not ruled out complete separation. We can expect BT to fight this all the way and try to water down proposals. Afterall BT has thrown the kitchen sink at stopping the break up. In the early days after the announced review, BT’s MD Gavin Patterson having first called it a mistake then threatened to take legal action. BT then launched large scale advertising campaigns promoting Openreach and finally offered to increase investment in the broadband network but only if the break up didn’t happen.

This type of separation has already happened, with great success, in countries such as New Zealand and Singapore. Botswana which is currently privatising its equivalent of BT decided to keep the network infrastructure with a separate company.

Consumer – not business – focus

BT may claim that superfast fibre broadband is available to 90% of the country but try telling that to businesses in central London. We recently helped a client moving to Oxford Circus. Instead of being able to spend £500 a year to get fibre broadband which their media business needed they were faced with paying almost £4,000 a year to get a dedicated connection. The EEF, the manufacturers association, in a recent survey said their small business members were paying an average of £5,000 a year to get decent broadband. All because Openreach has decided to prioritise the roll out to residential areas to support it’s investment in BT Sport.

Also as anyone who has sat waiting for an Openreach engineer to turn up to install a phone line knows problems occur on a daily basis. They do not appear to have addressed the issue whereby as an end customer you cannot talk directly to Openreach. You have to go via the company you ordered services through. The only thing you can complain directly about today is if their engineers make a mess of your carpet. We know of a business that has been waiting two months for a phone line and broadband to be install at new offices and there is still no final date despite the matter being raised directly to BT’s MD.

Other decisions are steps in the right direction however.

The opening up of BT’s network so that other providers can use their poles and underground ducts to run their services should speed up the rollout of faster services although it could increase the problems of number portability.

The introduction of automatic fines is something we have advocated for a long time. The current targets allow for 1 in 5 faults to take more than two days to fix and one in five installations to take more than two and a half weeks. Ofcom have yet to say what the new targets and how the high the fines will be. They cannot be token slaps on the wrist.

The league tables of suppliers will also help businesses and customers make more informed decisions.

Golden Opportunity Missed?

But overall I think this is a golden opportunity missed to take a radical step to improve a key infrastructure and the services around it for businesses and consumers alike. I hope that in the subsequent review on the exact future structure Ofcom realises it and pushes ahead with a full separation.

A separate company operating on a licence like the train operators would be more accountable. It would know that non performance could lead to loss of its licence.

The full text of Ofcom’s announcement can be found here http://media.ofcom.org.uk/news/2016/digital-comms-review-feb16/

Five Telecoms Issues you must consider when Moving Office

 

If you’re planning to move offices then it is essential you consider your telecoms options early in the process. Far too often they get left to the last minute. At best this can lead to added stress, or at worst long delays and increased costs.

Don’t Leave It Until too Late

BT Openreach has a monopoly on all line installs regardless of who they are ordered through. This means there is a minimum wait of at around 10 working days – but it can vary from town to town. For example, in some areas of Surrey the lead time is currently six weeks.

The average time for larger business needing ISDN lines is 6-8 weeks, and larger data connections, such as EFM, can take 40 working days, with some leased lines taking over 60 days.

Property Search

Most companies want fast broadband, and it is relatively easy to find out what is available in terms of speed and providers.   For example, a location that has fibre broadband will enable you to have very fast speeds without the need for expensive dedicated circuits.

However, there are plenty of places where there is a lack of availability. For example, one company moved into premises in September 2012 as the BT website said fibre would be available at the end of the month – they are still waiting.

Your Existing Numbers

Companies often underestimate the costs of changing phone numbers: how many people have your current brochures and business cards; are there websites and blogs you don’t control that have your current number on them; you can tell current customers and suppliers but how do you let potential customers know?

Check to see whether your new offices are on the same BT exchange. Crossing an exchange boundary can mean different telephone numbers and the loss of fibre broadband.

If you are moving to a different exchange there are ways around the potential problems, for example, moving numbers to virtual inbound – though this can be expensive and you bear the cost of incoming calls.  Alternatively you could consider installing SIP instead of, or as well as, ISDNs, which means you can take your numbers anywhere. However in some parts of the country this can be very expensive, especially if you need to provide additional data connectivity.

Move the System or Replace it?

Moving to cloud based (VOIP) solutions allow you to take a number anywhere.  However, if you have recently invested in a phone system then your accountant might not be happy to write that cost off.

Ask yourself; how old is the existing phone system?  Is there life or money left in it?  What is the cost of removal and reinstallation?

If you are thinking of going to SIP check whether your existing ‘phone system will support it. You may be able to reuse the handsets, which often account for a third of the cost.

Our Tip: If you are considering VOIP ask a Telecoms broker – Click Here!

Watch out for Serviced Office Charges

Before you decide on serviced offices check whether you have flexibility to bring in your own phone and data solution, if not at the beginning, then later on.  Also can they add your existing numbers to their system? If they give you new numbers – will you be able to take them with you when you leave? Finally, what are the detailed charges? We often see mark ups of 200%.

In conclusion, it’s essential to start planning early; all too often telecoms and data get left until last and yet they are often the factor that determines the earliest moving date. Leaving it too late means a lack of time to evaluate all the options and possibly ending up either in premises with no phones or, even worse, where the lack of broadband will have a long-term detrimental impact on the business.

Free phone system scams, what do you need to know?

Back in 2011, three directors of a Telecoms company in Norfolk were sent to jail for fraud. They enticed companies and charities with the promise of free phones, but those who took up the offer found themselves stuck in expensive, long-term contracts.

Phone system scams like these keep resurfacing – and companies keep getting caught out.

They usually start with the promise of a new phone system for less than a firm’s current outgoings, backed up with a proposal that purports to compare current and future costs. Typically, these imply large savings, but in reality they are very short on detail and obscure the fact that you’re signing a lease hire agreement, plus a long-term commitment to lines and calls.

If you are approached with this type of deal, here are the questions to ask. Only accept answers in writing and if you sign the contract, add a clause based on the responses you received and state that it is on that basis that you’ve signed.

Reputable suppliers who have a genuine offer should be willing to answer these questions and agree to make responses part of the contract.

Once you have all the answers, rework their ‘before and after’ pricing. Does it still show a saving or has it swung to a point where it is costing you money?

If you have already signed one of these deals, there is still hope. If there was a false inducement to purchase, the deal could be struck down by a court. Trading Standards is another option. If you are a company of fewer than 10 people, check to see if the supplier is registered with the Ombudsman scheme, as they offer free binding arbitration.

There are some genuinely good deals being offered but there are also far too many dodgy ones. The old adage, ‘if something looks too good to be true’, holds here – if it looks too good, it’s probably dodgy.

Questions to ask:

What are the actual prices for the lines and calls?
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    1. Compare the prices to your current bills to confirm the claims.
    2. Are those prices guaranteed or only for the first year?
    3. Do you have the right to cancel if they raise prices?

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Have they quoted for all the services you currently receive?
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    1. When comparing costs, many proposals include money you might be paying for an alarm line or lines for PDQs in your current costs but exclude them from the proposed costs.

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When they present back your existing costs, check them against your actual bills.
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    1. Go through your recent bills and check that they are accurately reflected in the current cost column of the comparison.

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Is the system being provided on a lease hire or lease purchase?
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    1. If the latter, what are the options at the end of the contract?
    2. Is there a cost for the transfer of title so you actually own it?
    3. If so, is that reflected in the claimed savings?
    4. If it is a lease hire, what happens at the end of the agreement?
    5. What happens if you need to expand the system during the lease?
    6. Will any equipment that’s added link to the same end date as the original agreement?

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Ask for a separate quote for outright purchase of the equipment.
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    1. Then ask other suppliers for a purchase price so that you can compare. Ask them to break out the different elements of their costs, rather than just giving a total figure.
    2. Then ask them to confirm the rate of interest being charged.

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What equipment is actually being supplied?
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    1. Ask for the make and model of all elements. Visit the manufacturers’ websites and see if they are current and the prices quoted are right.

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Are there any charges that will be levied that are not identified in the proposals?

Who is providing the finance?
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    1. If it is a third party finance contract, be wary as it will be harder if you want to challenge the contract later.
    2. If the finance is provided by the supplier or the equipment manufacturer then you have a greater chance of disputes being resolved.

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