Consumers to benefit from easier broadband and landline switching

08 August 2013

  • Customer's new provider to manage the transfer process on their behalf
  • Improved measures to prevent against loss of service when switching

Ofcom today announced new measures to help consumers change landline and broadband providers with greater ease, confidence and convenience.

Consumers currently face a number of different switching processes1 depending on which provider they are moving from and to, or the type of service being switched.

Not only do complex switching processes cause confusion, they also increase the perception that switching is difficult, which can prevent consumers from moving to a better deal.

Ofcom research shows that, in cases where the customer has to contact their existing company to request a change, the resulting process can be significantly more difficult for consumers to follow.

Such a process can give too much control to the existing provider, which has an incentive to delay or disrupt the transfer. This can also result in unwanted pressure on customers not to change provider.2

To resolve these problems, Ofcom has today decided that consumers only need follow a single switching process in future, in which the new provider leads the transfer process on behalf of the consumer.3

Under this 'gaining provider led' process, which is already in use for most landline and broadband switches, consumers will no longer need to contact their existing provider to receive a code in order to switch provider.4

Ofcom has also set out additional measures to help prevent consumers losing their service during the changeover process or being switched without their consent.

Claudio Pollack, Ofcom's Consumer Group Director, said: "Today's announcement represents an important milestone in Ofcom's work to improve consumers' experience when switching provider.

"The move towards one clear and simple system led by the gaining provider will result in a switching process that works in consumers' best interests. We will now be working on further measures to improve consumers' experience of switching."

A clear and improved switching process to help consumers

Ofcom proposes to move to a single process based on the existing gaining provider-led system. The existing process will be enhanced to deliver added benefits for consumers. Under the single switching process, providers would have to:

  • keep a record of every customer's consent for any switch to protect them from being deliberately transferred to a different provider without consent - a practice known as 'slamming';5
  • improve their use of certain processes6 to prevent against consumers losing service when changing provider, particularly when switching landline and broadband services together;
  • mitigate against consumers having their lines switched accidentally during house-moves, by only placing an order to take over communications services at the new property once they have an exact match for that address. Consumers moving out of the address where services are due to be taken over must also be notified by their own provider;7 and
  • give consumers better information on the implications of changing provider, such as early termination charges, so they can make informed decisions on whether to switch.

Ofcom is today consulting on the detail of putting these improvements in place, via a change to regulatory rules (known as 'General Condition'’) and on timescales for changes. This consultation closes on 2 October 2013.

Ofcom aims to finalise these details by early 2014, with the new process coming into effect within a year thereafter.

Next steps on switching

Following today's announcement, the next phase of work on switching will be focused on two key areas:8

  • working with industry on additional ways of ensuring consumers are better protected against having their lines switched in error; and
  • considering further improvements to processes for landline and broadband switching between different network types (for example to and from the cable network);9

In the future, Ofcom may also review switching processes for pay TV and mobile. Today's statement and consultation and an accompanying plain English summary can be found online.

ENDS

Notes to editors

1. A 'losing provider led' switching process means consumers must first contact their existing provider to obtain a code to give to their new provider. A 'cease and re-provide' process means a consumer will usually need to speak with both their existing and new provider for a service to be terminated and a new one installed. A 'gaining provider led' process (currently known as 'notification of transfer') means that consumers need only speak to their new provider who will manage the switch. Those consumers switching bundled services may have to follow both losing provider and gaining provider processes at the same time.

2. Ofcom has used evidence obtained from a variety of sources - one element being consumer research. Following last year's consultation on options for switching, Ofcom conducted additional in-depth consumer research which found that:

  • Switches led by a losing provider are significantly more difficult for consumers to follow. Nearly half (46%) of consumers with a landline/broadband bundle who considered switching, but eventually decided against it, said that a lack of clarity about the switching process was something that put them off.
  • Sixty per cent of consumers who switched both their landline and fixed broadband services through a gaining provider led process found the switch to be 'very' easy, compared with 38% of losing provider led switchers.
  • One in five consumers following a losing provider led process (19%) said loss of service during the transfer was a main or major issue experienced, compared to 9% of gaining provider-led switchers.
  • 17% of consumers who spoke to their previous provider felt they were put under pressure to stay. And 41% of those who were subject to persuasion said they were unhappy with the efforts their losing provider made to persuade them to change their mind.

These research findings were published in the Customer Retention and Interoperability Research 2013.

3. Ofcom consulted in February 2012 on the problems associated with switching processes on the Openreach network, and set out options for reform. We favoured moving to a gaining provider led system, with a third party system to verify consent to switch. This was consistent with the conclusions from our strategic review of switching in September 2010. Ofcom has now rejected the 'third-party verification' (TPV) option, primarily due to new evidence on switching without consent, known as 'slamming'. This evidence shows that incidence of slamming has fallen and is now significantly less prevalent than stated at the time of the February 2012 consultation (see Section 5 paragraphs 5.65 to 5.72 of the report).

4. Ofcom's decision applies only to switching providers on the Openreach copper network. The Openreach copper network is a single infrastructure supporting a number of suppliers. Ofcom previously decided to prioritise work on switching processes on the Openreach copper network as switching landline and broadband providers were the areas of highest concern. Ofcom's policy decision therefore applies to fixed telephony as well as standard and superfast broadband which use copper into the home (including fibre to the cabinet, or FTTC). It does not currently apply to cable, or to fibre to the premises (FTTP) customers. Ofcom will be considering the possibility of developing a consistent switching process for consumers to ensure they have a similar experience regardless of the network.

5. 'Slamming' occurs when a consumer is simply switched from one company to another without their express knowledge and/or consent.

6. Where a bundle of landline and broadband services are being transferred, communications providers will be required to submit to Openreach an order for the simultaneous transfer of both services with minimal loss of service.

7. 'Erroneous line transfers' can happen as a result of consumers having their lines switched accidentally and more commonly occur when a customer has requested a service to be provided to their house, but the service is instead provided to a neighbouring house. This is primarily caused by current limitations in providers' abilities to correctly identify the target address for takeover. A 'Working Line Takeover' is a process used when consumers are moving home and allows consumers to have working services on the day they move into their new home at a lower charge. However, sometimes systems may not reliably identify the new property and therefore the wrong property is accidentally targeted for takeover.

8. This next phase will focus on addressing these issues via two main options - a further enhanced version of the systems that exist today, or the establishment of a new 'hub and database' system to co-ordinate interactions between providers and support better switching outcomes for consumers.

9. Communications services are provided over a variety of networks; the 'Openreach copper network' (as mentioned in note 3 above), the ‘Cable’ network, and other networks based on 'Fibre to the Premises' (FTTP).

10. Ofcom is the independent regulator and competition authority for the UK communications industries, with responsibilities across TV, radio, telecommunications, wireless communications and postal services.

CONTACT

Ofcom Communications

ofcomnews@ofcom.org.uk

0300 123 4000