This week I went to Bournemouth to view a show house which demonstrates the capability of one of the largest FTTH schemes outside the national roll-out schemes of BT and Virgin Media. The scheme is branded Fibrecity and it is being constructed by H2O Networks which is a British, privately-owned company. The name of the company is the clue to its business model: it lays optical fibre in the sewers - in Bournemouth's case, those of Wessex Water - and then the cable comes out of a manhole and micro-trenches (20mm wide by 60-150 mm) take the cable to residential homes.
In Bournemouth, H2O started pulling in cable in the summer and by early 2011 expects to have passed 85,000 homes. So far, some 200 homes have been passed, of which 84% have agreed to the free installation of an A5-sized box being fitted to the outside of the house. H2O's business model means that it sees itself as a utility and expects to achieved a return on its investment over 15-20 years.
H2O will not itself provide any services. Instead it will run an open access network and, on appropriate commercial terms, any service provider than wishes to do so can use the network to serve customers. Any customer signing up to a service provider - none are operating yet - will visit the customer's premises to install the internal wiring that will be necessary to receive the service.
What services in what bundles at what prices are offered to consumers depends, of course, on the service providers, but the wholesale offering by H2O to those providers is 100 Mbit/s downstream and upstream. In the show house, I saw several televisions showing HD channels plus a Wii being used as an online console plus an X-box operating online plus IPTV on a PC plus several radio station plus an IP phone all operating simultaneously and the network coped smoothly with it all. Of course, no home will want or need this sort of bandwidth for years, but the network has a considerable degree of future-proofing and it will be for the competing service providers to parcel out the bandwidth as consumers find the need and are prepared to pay for it.
Bournemouth will be the first of a number of such Fibrecities. The next in line is Dundee. Construction there has not yet started but is expected to be completed in late 2011. Some 73,000 premises will be passed. Other Fibrecities are expected to be announced by H2O soon. The company's aim is to have half a million homes connected to its local networks by 2012.
The FCC has pronounced on Net Neutrality - the principle that ISPs should not mess with the traffic they carry - before. But in a speech last week the new Chairman seemed to be edging closer, much closer to supporting the principle.
By the end of March this year, 46% of all UK homes bought their communications services in bundles - and the trend seems likely to continue, and include an increasing proportion where mobile services are a part of the package. Given the increasing popularity of service bundles, it's clear that consumers would benefit from a more unified switching process for communications services.
With this in mind, the Panel sent a letter today in response to Ofcom's consultation on mobile number portability - the process by which you switch from one provider and deal to another, but keep your original number. (You can read the full letter here.) The Panel is pleased that Ofcom intends to improve the system of mobile number portability. In doing so, it will be important to consider how this will tie in with plans to develop a more unified switching process for communications services. As far as possible, the Panel thinks that the switching processes for communications services and the process of porting mobile numbers should be consistent and require the limited involvement of consumers.
It's important that simplifying or speeding up the process of porting numbers doesn't cause undesirable side effects - the slamming and scamming potentials for consumers to be switched to a new provider without their consent, or consumers having insufficient information to make an informed decision.
One thing which the UK might usefully draw lessons from in moving this forward, is the French model. There, consumers receive a code when they request a switch, avoiding the need to communicate with either the gaining or loosing provder. They also get a text which tells them how long their current contract has to run, or whether they are out of contract. We were happy to see that Ofcom's consultation looks at how other countries' strategies for improving mobile number porting, including the French system. Our current system has been a source of frustration for consumers for some time now, so it's exciting to see the possibilities for improvement which could be developed here.
This month the Panel devoted a good chunk of our meeting time to developing, what we have been calling a framework for digital participation. We want this framework to provide an overview of what different groups of consumers need to get online and make the most of being online - everything from the motivation to take a look, through accessible products and services, to the skills to create content and participate in e-exchanges. (You can find an early version here, but it has already changed a lot). We want this framework to start from the consumer perspective, which is why we have rooted it in research; in particular, the deliberative research we did on the future of communications (http://www.communicationsconsumerpanel.org.uk/No%20one%20should%20miss%20out_digital%20future%20research%20report.pdf)) and the work Ofcom has done amongst those not yet on the internet (http://www.ofcom.org.uk/research/telecoms/reports/bbresearch/bbathome.pdf), have influenced the shape of the framework.
We hope this framework will be used by everyone who will be involved in supporting consumers and citizens in getting online and deepening their digital engagement. We think using the framework will help to ensure that the work that is done meets consumer and citizen needs and priorities - so we have less of what policy makers and industry want to tell us, and more about what we want to know and learn. We are already discussing the framework with the people we hope will use it and once it is complete we will publish it and use it to inform what the Panel says about all the digital participation and inclusion work that is going on.
The Panel also had discussions with Ofcom teams about the complaints and ADR review and the Mobile Sector Assessment. We had just received the results of our own mobile coverage research among consumers and were able to share early thoughts on this with Ofcom. The research confirms the importance of network coverage issues for consumers and small businesses. It will be published in the next couple of weeks, so watch this space.
We also reviewed our work on superfast broadband (NGA) and agreed an update of the paper we published on local NGA schemes. Finally, we did a quick stock take of the work going on under the Digital Britain banner, especially in relation to the legislation that will affect Ofcom's future duties, bearing in mind that any change in Ofcom's responsibilities raises issues about the role of the Panel.
In order to seek further views from consumer representatives on the importance and impact of mobile termination rates to consumers, Ofcom and the Communications Consumer Panel jointly hosted a round table discussion, on 14 September, with organisations which have responded to the recent Mobile Sector Assessment consultation. The purpose was to explore views in a little more depth and seek comments on alternative ways forward.
Briefly a mobile termination rate is the price paid by the operator of the network from which a call to mobile is made, to the network operator of the person who receives the call. It is intended to compensate the second (mobile) operator for the cost of carrying the call to the person being called. The cost to the first operator is covered by the charge to the person making the first call.
There seems to be universal agreement both with industry and with consumers that this area needs to be regulated and that, in all cases mobile termination rates will continue to fall, which is good news for consumers.
There was also healthy scepticism among the group about some of the claims by those operators who want to see radical change about the extent of current consumer harm, and also about the claims of the damaging effects that might result from changes, by those operators who do not want to see radical change.
The conclusion from the consumer groups present was that this was not the most important topic in telecommunications for their clients, but that there was a specific area of detriment in that it affects text relay services for deaf people and they could see some advantage from lower prices leading to inclusion of calls to mobile in the package deals from BT and other fixed operators. There was however concern that a regulatory intervention to reduce calls to mobile charges to very low levels might have an effect on other consumers if prices were to rise elsewhere to compensate. No one felt confident to predict where and to what extent this might happen. For a fuller description of how this might affect individual groups see the paper from Antelope Consulting that the Panel commissioned earlier this year.
The consumer groups concluded that in deciding between options, Ofcom should consider four principles.
This is not the biggest issue for consumers and so, to avoid confusion, an evolutionary change is preferable to a sudden one.
It has been almost three months now since the Government's Digital Britain report was published, and everyone interested in this area is still mulling over the implications of the report, with a prime focus on its internet ambitions. The Panel has published its response to the report today and you can read it on our website at: http://www.communicationsconsumerpanel.org.uk/Response%20to%20Digital%20Britain%20final%20report.pdf
The report could be the kick-of for a programme of work that delivers real benefits to consumers. Many people across the UK do not have the same fast, reliable broadband that others have access to and strong hopes have been raised that this situation will be remedied with suitable investment in infrastructure.
However, getting people online is about much more than delivering a reliable 2Mb/s internet connection. There are people who have never been online before, and who would welcome the opportunity to give it a go and learn how to use the internet in a safe environment. Others are reluctant to try accessing the internet out of fear for fraud, viruses and spam. Their needs should be catered for under the Digital Britain umbrella as well.
Recent discussions I have had with organisations delivering internet opportunities to a range of consumers on the ground have shown just how important the first impression for newcomers to the internet is, and how diverse the training needs of different people can be. I have heard how many older people prefer training that is delivered in a social, group setting by a well-know trusted organisation, where someone else has worried about which anti-virus protection to put in place and there is constant hands-on advice available as they go along. I have learned how blind learners of access technology, such as screen readers and people with autism, prefer one-to-one specialist training that works at their individual pace. Plus, people go online and expect to find websites that are well-designed, easy to use, accessible and in plain English and are put off if they are not. Disabled people who can not use a mouse expect specialist advice in training settings on the best alternative technology for them. And younger people might be more willing to learn through trial and error and will generally be less worried about ‘breaking the computer' when they are learning how to use it.
One message has come through loud and clear through all these conversations: if their expectations and training needs are not adequately met, newcomers to the internet will give up on the technology. Especially for people who have to make an extra effort to learn how to use computers and the web, there has to be a significant reward at the end: the internet has to make one of their personally important life areas, whether that is staying in touch, shopping, entertainment, finding information or using government services better, quicker or easier. Together with delivering the infrastructure and the training required, this is no small but a very worthwhile challenge for Government, industry and a whole host of organisations working at local level around the country.