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February 9, 2012

Ofcom to make swapping telcos quicker and easier

Ofcom has today proposed measures to make it easier for consumers to change broadband providers, while also protecting them from being switched without their knowledge or consent.

By Vinod

Ofcom says the changes are needed to keep competition healthy and ensure users aren’t handicapped by downtime or other hurdles when changed providers.

The telecommuncations regulator’s research also revealed that UK consumers find switching to other services – such as utilities or insurance – easier than signing up to a new broadband provider (4% and 23% respectively). 45% of broadband consumers think that switching communications provider is too much hassle.

The research also showed that one in five consumers who switched their broadband provider lost service for around a week. As of September 2011, 130,000 users have also faced problems with the wrong telephone being taken over during the switching process, or moving house.

"Smooth switching processes are essential to ensure that consumers can change providers with confidence. Many people think that the current systems are too difficult and unreliable which is why we have made it one of our priorities to tackle this problem," said Ofcom Chief Executive, Ed Richards.

Even more worrying, 520,000 users had their broadband services ‘slammed‘ (switched without consent) in the last year. This has historically been a problem with the telecommunications industry in the UK, and OfCom is basing its proposal on similar initiatives in the UK and USA..

"Ofcom has improved consumer information on broadband speeds and enhanced competition in the market but it is also essential that people are able to switch easily to exercise their choice. Today’s proposals are designed to make the process easier, more reliable and safe from slamming. We believe that the proposals would improve consumers’ experience of switching and ensure that they continue to benefit from competition."

The Communications Consumer Panel doesn’t think OfCom has gone far enough in the face of consolidation amongst media and infrastructure companies. It wants Ofcom to develop switching processes for all communications services such as mobile, pay TV and cable services, as a bundle. Virgin Media, for example, provides all these services in a single package.

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"We are particularly concerned that current switching processes will not keep pace with the trend towards increased bundling of services, including pay TV services. This will become more of an issue as convergence continues and competition intensifies. We will be monitoring this issue carefully," said CCP chair Bob Warner.

OfCom’s proposal

OfCom's switching proposal

– ensuring that switches are verified by an independent third party to protect consumers from slamming;
– simplifying the process so that consumers are not confused by different methods of switching;
– ensuring that all providers can compete so consumers can continue to benefit from innovation, choice and value for money;
– addressing technical problems when switches take place, which currently can lead to the wrong line being switched and consumers losing service;
– ensuring that consumers have accurate information on the implications of switching so that they can make informed decisions on whether to change providers; and
– simplifying the switching process so consumers do not have to contact different providers when moving to a bundle.

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