New proposals to help switch between BT, Virgin Media, KCOM, and Sky to avoid double payments and loss of service
Ofcom has issued its proposals to make it easier for customers to switch between the networks of BT Openreach, KCOM, Virgin Media and Sky.
The regulator has also proposed rules to address the problem of ‘double payments’ for customers who switch their mobile providers. It hopes to reduce the number of mobile customers who are charged after the date they switch their service to a new provider – saving at least £13 million per year.
Ofcom is hoping to gather all inputs on the mobile double payments by September, and intends to announce the new measures alongside reforms to the overarching mobile switching process around the end of this year.
The Pay TV and broadband and landline proposals meanwhile will cover those services that are either purchased individually or as part of a ‘bundle’.
Ofcom hopes to encourage users to switch their service providers with greater ease and confidence, after it noted problems when switching between providers whose services are delivered using different networks (for example if someone were to leave BT’s network and move across to Virgin Media’s cable network).
The regulator said that it estimates around 884,000 switches are made between these networks every year, but there is currently no formal switching process to help people.
“Instead, a customer must contact their existing provider to cancel their service or services, as well as their new provider to arrange the start of the new service,” said Ofcom, adding that 81 percent of people who switched networks found it very or fairly easy. But it discovered that almost eight in 10 (79 percent) people said they encountered some kind of difficulty during the process.
Typical problems include customers having difficulty cancelling their previous service (38 percent), and loss of service (17 percent) for on average about a week whilst the switch took place.
Other problems encountered include more than one in five (22 percent) double-paid by an average of £22 as a result of their old and new contracts overlapping.
So Ofcom is proposing to options to help here. Its first and perfered option is to place responsibility for the entire switching process in the hands of the customer’s new provider. This means that the customer only deals with their new service provider.
This option is unlikely to go down well with service providers however, as they typically like to negotiate a better deal for customers who are leaving in order to tempt them to stay with their company.
Ofcom’s second alternative option therefore is an enhanced version of the existing arrangements for switching between networks.
“Under this proposal, customers would still have to contact their existing provider to cancel their service or services, but could do so without having to speak to them on the phone,” said Ofcom. “Ofcom would require providers to offer a wider range of cancellation channels – for example, via webchat or an online account.”
The regulator thinks both these options would reduce loss of service and double paying. It hopes to gather industry views by October, and will then consider all available evidence before publishing its decision by summer 2017.
“People should be able to switch easily to take advantage of the best deals in the market,” said Lindsey Fussell, Ofcom’s Consumer Group Director. “We’ve already improved the switching experience for millions of landline and broadband customers. Now we’re consulting on making it easier and more reliable for telecoms and TV customers to switch between different networks – including when their services are bundled on to one bill.”
“Switching in the communications sector lags majorly behind other consumer services,” said Richard Neudegg, Head of Regulation. “Getting switching right is not only important in helping us access better deals with minimal hassle, but it can also help boost market competition.”
“To date, communications customers have been plagued with artificial barriers to getting better deals. There’s a multitude of communications services with different switching arrangements and cancellation rules, adding unnecessary complications.
“For any cross-platform switches, the operator losing the business still handles the cancellation – which means they have little incentive to make it quick or easy. Ofcom’s proposals today are a welcome step towards sorting out this problem.
“We call on the communications industry to now get behind Ofcom’s proposal for a system where the new provider manages the switch across the board – removing the complexity and hassle currently faced by consumers. Ofcom’s strategic review of consumer switching was nearly six years ago, and today’s document marks the eighth Ofcom consultation on switching. Consumers have been waiting long enough.”
Mobile operator Three also welcomed the proposals.
“Three has long campaigned for reform of switching in mobile,” a Three spokesperson said. “A change to gaining provider led switching is the only way to improve competition and ensure that the best mobile deals are not kept only for those customers who want to leave their current provider”.
BT meanwhile said it was “supportive” of Ofcom’s proposals.
“BT is very supportive of Ofcom’s aim to make switching between providers as hassle-free as possible for consumers and therefore we welcome their current consultation,” a BT spokesperson told TechweekEurope via email.
“If adopted, the proposals would allow customers who wish to switch a triple play bundle (voice, broadband and pay TV) between different platforms to follow a simple process co-ordinated by the gaining provider, just as they can today for voice and broadband switches within the Openreach network,” the spokesperson said.
TechweekEurope did not receive a response from Sky at the time of writing.
Virgin Media meanwhile said it was studying the proposals and would make a statement in due course.
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