FCS response to BIST Consultation – Open Communications: A Smart Data scheme for the UK telecoms market.

The FCS represents companies which provide professional communications solutions to business users. Our members deliver telecommunications services via mobile and fixed line telephony networks, broadband, satellite, wi-fi and business radio. Our members’ customers range from SMEs, home-workers and micro-businesses up to the very largest private enterprises and public sector users. FCS is the largest trade organisation in the professional communications arena, representing the interests of circa 350 businesses which supply B2B services nationwide.

The FCS welcomes any initiative that increases competition and provides consumers and businesses with information to make informed choices.  We welcome the opportunity to be able to respond to the BIST consultation on behalf of our members.

We would like to make a number of general observations before going on to give specific responses to some of the individual questions posed.   

General Observations:

• The UK business telecommunications market is very competitive, with hundreds of Communication Service Providers (CSPs) providing innovative and integrated solutions to many different businesses. Indeed, the range of solutions offered is only matched by the number of differing customer requirements.  In many cases, telecom services are just one part of a wider business solution incorporating many elements, such as IT, security, HR, advertising (website design etc) and even logistics and production.  With such diverse customer needs, it is difficult to identify a single data set that will help business customers to make informed decisions.  Indeed, given the complexity of business offerings, details of the individual telecoms elements might confuse business customers rather than help them to make informed choices.
• Increasingly, the differential between consumer and small/micro business customers is difficult to make. For example, a sole trader plumber may take a residential telecoms service, an architect practice may be made up of homeworkers using residential lines, conversely an ardent gamer may buy a business grade line to ensure resilience and greater bandwidth. It is important that the reality of this market blurring is recognised in the wording of any new regulation, and that any changes intended to address the consumer market do not inadvertently apply to business CSPs who may not know that they are, in fact, providing services to consumers.
• At a practical point of view, there is currently no way of distinguishing a “business” line and a home broadband line and the FCS suggests that Ofcom should determine a definition of a business line/customer and require industry systems and processes to recognise it. Without the ability to identify a business line/service throughout the value chain, it will be very difficult to implement any consumer specific recommendations.  
• Ofcom has a duty to promote the interests of consumers. To avoid unintended consequences on the business market, Ofcom should also have a duty to champion business and ensure that the fixed and mobile industry switching and other processes factor in business markets from the outset and not be an afterthought.  
• The business market can have complex supply chains with multiple resellers involved, alongside aggregators and wholesale network providers. Traditionally, regulation is applied at the retail level and in some cases it can be difficult for resellers to comply, as the information they require does not necessarily flow down the supply chain to them. It is clearly important that resellers are able to comply and any requirements on CSPs will need to be backed up by corresponding obligations on wholesale network providers/aggregators.
• Business CSPs are facing unprecedented levels of change. One Touch Switching, move to AllIP, Openreach Exchange Closures, and Security requirements all require substantial system and process development and it is difficult to see how CSPs, particularly the smaller ones, would be able to implement any additional regulatory changes at this time. The PSTN switch-off is particularly challenging for non-standard solutions, such as lift-lines, alarm services and other bespoke services which are often provided by small, niche CSPs.  It is vital that these critical services are maintained and that focus is not diverted.  The PSTN switchoff is set for December 2025 and the FCS believes that there should be no additional requirements placed on CSPs until the end of 2026 at the earliest.
• The move to All-IP will see convergence increasing and this will have an impact on the type of services provided. The traditional split between mobile and fixed broadband is likely to become less relevant and data shared in both environments need to be processed in a like manner.
• The FCS is concerned that any Open Communications database could be misused and it is imperative that there is adequate security so that it cannot be used to provide competitor insight which could be exploited.
• As with any regulatory change, the cost of implementation will need to be understood and taken into account. Any additional costs will disproportionately affect smaller providers and this can, in turn, have an impact on competition, leading to increased costs to consumer/business customers and to reduced innovation.  It is not clear to the FCS that the benefits of an Open Communications scheme in the business market outweighs such potential impacts.

The FCS would be very happy to facilitate sessions with some members if it would help the BIST to develop its thinking. It will be particularly important for the BIST to consider the needs and views of smaller Communication Providers who frequently provide bespoke, innovative solutions and whose requirements can often be overlooked.

Specific responses to Consultation questions:

Design of an Open Communications scheme

1. What are your views regarding the potential impact – positive or negative – on consumers of establishing an Open Communications scheme in the UK telecoms market? Please provide evidence or data to support where possible to support your answer.

The FCS welcomes initiatives designed to improve information to consumers and businesses. It is clearly important that consumers have adequate, reliable information to make decisions relating to their telecoms services.  However, the FCS is not convinced that there is a need for an Open

Communications scheme in the UK telecoms business market at the moment.  The UK telecommunications market is competitive and there are already regulatory safeguards in place to protect consumers and small businesses.

3. What are your views regarding the potential impact – positive or negative – on telecom providers of establishing an Open Communications scheme in the UK telecoms market? Please provide evidence or data to support where possible to support your answer.

There could be positive benefits for telecom providers if consumers and businesses feel better informed about telecoms services in general. Reliable information could enable consumers and businesses to switch provider with more confidence. However, given the diverse customer requirements in the business market, it is difficult to see how a single data set could be agreed.

Any additional regulatory requirement comes at a cost which is often disproportionately borne by small players in the market. This is particularly the case when there are so many other demands on CSPs.  

Business CSPs are facing unprecedented levels of change. One Touch Switching, move to All-IP, Openreach Exchange Closures, and Security requirements all require substantial system and process development and it is difficult to see how CSPs, particularly the smaller ones, would be able to implement any additional regulatory changes at this time.  The PSTN switch-off is set for December 2025 and the FCS believes that there should be no additional requirements placed on CSPs until the end of 2026 at the earliest.  

4. If you highlighted any negative impacts to telecom providers, do you have any views about how these potential negative impacts may be prevented or mitigated?

The introduction of any potential scheme could be delayed until the impact of the move to All-IP is understood.

5. What are your views regarding the potential impact – positive or negative – on the telecoms market as a whole, in establishing an Open Communications scheme? Please provide evidence or data to support where possible to support your answer.

Given the level of competition, particularly in the business market, it is difficult to see that the introduction of an Open Communications scheme would have a dramatic effect on the market.

8. Do you have any views regarding the potential benefits, challenges, or unintended consequences of requiring providers of home broadband services to participate in any Open

Communication scheme? Where possible, please provide evidence or data to support your answer. 

Given the blurring of lines between the consumer and small business market it can be difficult to differentiate between the two markets.  If obligations are placed in the consumer market only, it will be important to understand potential unintended consequences on business CSPs.

9. Do you have any views regarding our assessment that any such scheme should require all providers of home broadband services – regardless of size – to participate?

We agree that, if any Open Communications scheme is introduced, all providers should be required to participate. For this to happen there would need to a requirement on wholesale providers to make information available to resellers so that they can fulfil any obligations.

At a practical point of view, there is currently no way of distinguishing a home broadband line from a business line and the FCS suggests that Ofcom should determine a definition of a business line/customer and require industry systems and processes to recognise it.  Without the ability to identify a business line/service throughout the value chain, it will be very difficult to implement any consumer specific recommendations.

10. Do you have any views or data regarding the potential impact on small, medium, or large providers of requiring their participation in any such scheme?

Any resource impact is likely to be disproportionately felt by smaller providers.  The timescales involved will need to allow for smaller CPs to participate.

15. Do you have any views, evidence or data regarding the unique challenges facing businesses navigating the business broadband and mobile markets?

Business customers often have unique needs and there are hundreds of CSPs which provide innovative and individual telecoms products to them, often as part of wider business support. In many cases, telecom services are just one part of a broader business solution incorporating other elements, such as IT, security, HR, advertising (website design etc) and even logistics and production.  With such diverse customer requirements, it is difficult to identify a single data set that will help business customers to make informed decisions.    

22. Do you foresee or anticipate any negative impacts of releasing any of the sets of data outlined in this section? Please provide evidence or data to support your response.

Business CSPs will need to have confidence that their commercial data is kept secure and cannot be used intentionally or unintentionally, for any other purpose.

24. Do you have any views on the potential merits, challenges, or unintended consequences of requiring providers participating in any Open Communications scheme to make data available via an API?

It will be very important that commercial information is kept secure.