News Archive

BT's takeover of EE approved by regulator

Published on 21/01/2016

Was the CMA the correct body to look at the BT/EE merger? Absolutely it was. Did the CMA listen to our advice to work intimately with Ofcom? Absolutely they did. So are their conclusions correct?

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Disappointed!  Is that a strong enough word?

Was the CMA the correct body to look at this merger?  Absolutely it was.  Did the CMA listen to our advice to work intimately with Ofcom?  Absolutely they did.  So are their conclusions correct?  Well, that rather depends where you’re sitting. 

There is a distinction between what is academically justifiable by reference to certain specific market definitions and what is likely to happen in the real, competitive marketplace in which CPs operate.  We can’t really blame Ofcom for sticking to those market definitions, because that’s the basis – the only basis – upon which they can regulate.  We can’t really blame the CMA for using those definitions in attempting to bring clarity and precision to what they admit is a complicated, dynamic and innovative market.  But we can blame them both for focusing on what we currently have, rather than what tomorrow is going to look like.

When you start from the kind of market definitions enshrined in the Communications Act 2003, you rather miss the fundamental point.  Which is that the market today does not operate the way it did in 2003, with different products sitting in neat technical silos which can all be identified and regulated separately.  This merger allows BT/EE to supply identical products over different delivery platforms, which are regulated in fundamentally different ways.  This is not a recipe for greater competition or enhanced user functionality.

Ofcom’s so-called ‘Digital Dividend’ spectrum auction at the end of 2012 was deliberately structured to avoid spectrum sequestration and to force an additional competitor into the market place.  BT bought the ‘new entrant’ block, sat on it for a couple of years, and can now merge it into EE’s 4G spectrum holdings without penalty.  Did nobody else really see that coming?   

In addition, as FCS cautioned all along, the combined entity currently looks set to enjoy a 100% monopoly over call-handling and communications functionality for the emergency services.  How does that play out in Ofcom or Parliament, when calls are made for stronger commercial controls?  “Of course, we could do that, Minister.  But it would, of course, draw resources away from that vital work your Home Office colleagues asked us to do after all those policemen died last year…”  Am I being impossibly cynical?  Or is that simply another version of the threat BT CEO Gavin Patterson made about “10 years of litigation” when politicians started asking awkward questions last year about structurally separating Openreach?

We had hoped the CMA would be minded to impose one simple and overdue solution:  to mandate a transparent and competitive market for wholesale access to mobile networks in precisely the same way as exists in the fixed-line telephony market.  We failed.  So the question is:  how good a job did the reseller community do in making its voice heard?

Many, many communications providers told FCS they believed this merger represented a major threat for them.  So we put in an early, robust submission pointing out our members’ fears.  We took a delegation to Ofcom to make sure the regulator understood our position.  We partnered with iMVNOx, the MVNO trade association, so we could feed some international experiences into the consultation.  And when those disappointing initial results were published, we encouraged members to rally round and write to policy-makers suggesting that as a minimum, equivalence of wholesale access should be extended to mobile networks.

FCS and iMVNOx did everything we reasonably could, on behalf of the reseller community.  It’s worth noting that Vodafone, Sky, Virgin, TalkTalk and Gamma (to name but five) also made spirited and detailed representations which ended up being ignored by the CMA.  We are not alone.  Though that hardly feels like any consolation.

In the event, we have lost round 1.  What does Round 2 look like?

At the moment, frankly, it’s too early to tell.  Our one consolation is that BT has always been a ‘willing wholesaler’ in the fixed line market (albeit one whose willingness has been at least partly forced upon it by the regulator).  And BT have consistently held to the line throughout these proceedings that they’ll be a willing wholesaler for mobile access, too.  An early move in this direction would certainly do much to calm resellers’ nerves.  On the other hand, BT and EE both have awful reputations for customer service.  Is either of them likely to be making additional investments in that area any time soon?

Also, the timing has been awkward:  Three and O2 are in their own merger talks.  Plus the industry is imminently awaiting Ofcom’s 10-year review of the BT Undertakings as part of last year’s Digital Connectivity Review.  At least in part, the CMA is looking to a post-review Ofcom to make good any deficiencies in its analysis. 

FCS has been calling for Ofcom to be allowed a far more agile, tactical approach to regulation.  Something far better suited to the fast moving markets of today and tomorrow than the old Comms Act definitions and heavy-handed price controls.  But whether or not that happens any time soon, tight vigilance by the reseller community is the name of the game now.  And early gathering and submission of evidence to Ofcom of any unforeseen market distortions.  

If the reseller community wants to get the best result from this merger, the reseller community has to react and report:  if we wait until the market is broken before we ask Ofcom to act, we will have nobody but ourselves to blame.

Chris Pateman, CEO FCS

FCS CEO Points to a Year of Progress

Published on 17/06/2014

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Radio codes of practice, guidance on Ofcom’s General Conditions and a commitment to encouraging small members to bid for government-sponsored contracts are highlighted as three cornerstones of success and progress in FCS Chief Executive Chris Pateman’s annual report to members.

"By the end of 2013, we had issued guidance to members about GC18," he says. "The Openreach Business Service Improvement Programme had at least begun to yield some useful new approaches to business provisioning, and the Public Sector Network procurement framework had been cast in such a way as to allow the maximum opportunity for small or niche suppliers to participate.

"Meanwhile, our FCS1362 standard had been mandated by Government Procurement Service as the default standard for all installations of radio frequency equipment across public sector vehicle fleets. And our FCS1331 standard had been re-written from first principles, and re-launched as an all industry code for engineering best practice on radio mast sites. It was particularly encouraging to see FCS1331 was immediately taken up by the organisers of the 2014 Commonwealth Games, and required in all bidding proposals."

None of this progress would have been possible without the ongoing and active support and input of the members, Mr Pateman said. "The FCS secretariat can point the gun, but it’s the members who provide the technical expertise, the real-life experiences and the evidence of market distortions which provide such powerful and effective bullets".

PRESS RELEASE: UK'S Chris Pateman joins Cloud 100 industry leaders

Published on 28/03/2014

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London, March 28 2014.

 

 

Chris Pateman, Chief Executive of the UK’s Federation of Communication Services, said he was “surprised and delighted” to learn last night that he is now numbered among Cloud 100 -- the global community of the 100 most influential ICT industry leaders -- as chosen by Cloud World Series, the organisers of the Cloud World Forum events.

“I take it as a hugely encouraging sign for the health and inclusiveness of this industry that my insights from a lifetime in and around channel and distribution chains are valued alongside the contributions of individuals with more obvious skills in IT development and infrastructure management,” Chris said.

“FCS is the voice of the UK business-to-business communications industry.  Now the channel has a voice at the Cloud community’s top table, I’m going to do my best to ensure the future development of Cloud solutions takes the maximum possible account of the channel and the broader supply chain.  The more closely we can bring clever solutions together with sales expertise, the more value we can deliver to everyone in the industry.” 

FCS Response to Ofcom's Annual Plan

Published on 10/02/2014

FCS Response to Ofcom's Annual Plan

Ofcom’s Annual Plan – 2014/15 Issued 20 December 2013

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FCS Response to Ofcom's Annual Plan

The Ofcom consultation can be found here.

Industry News

TalkTalk places last again in Which broadband survey, Sky drops

Published on 22/09/17 by info@telecompaper.com (Telecompaper)

Zen Internet has emerged again as the best broadband provider in the UK, while TalkTalk was rated worst in the survey by consumer group Which?. More than nine in ten Zen customers said they would r...

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O2 UK loses sales director, chief digital officer

Published on 22/09/17 by info@telecompaper.com (Telecompaper)

O2 UK has lost two top executives - sales director Ben Dowd and chief digital officer David Plumb. A spokesman for the operator confirmed their departures to The Register. 

A replacemen...

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Samsung reports record Note 8 sales in UK

Published on 22/09/17 by info@telecompaper.com (Telecompaper)

Samsung announced record sales for its Galaxy Note 8 in its first weekend available in the UK and Ireland. The company said this was the most successful launch of a note model to date. The smartpho...

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