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NTS Focus Group Minutes - Mar 18, 2010 (Read 5,193 times)
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NTS Focus Group Minutes - Mar 18, 2010
Jun 9th, 2010 at 12:26am
 
http://stakeholders.ofcom.org.uk/telecoms/groups/nts-focus-group/notes-of-meetin...

NTS Focus Group – 18th March 2010 – 2.00 pm Ofcom

Agenda item (1) - Introductions

Attendance:

Justin Hornby      C&W
Geoff Brighton      Ofcom
Sean Hartley      BT
Peter Farmer      Gamma
Nancy Scott-Picton      BT
Kath Embleton      BT
Sandra Reid      VirginMedia
Thomas Gransalke      Orange
Andy Martin      IV Response
Stephen Ornadel      T-Mobile
Claire Robinson      C&W Worldwide

By telephone:

Warren Berdo      Skycom
Kulshal Sareen      3
Lesa Green      KCom

Apologies:

Will Goodall      Flextel
Markham Sivak      Ofcom
Jeff Loan      Ofcom

Agenda (1): Review of Actions.

Justin Hornby opened the meeting and confirming that no actions were outstanding following the last meeting.

Agenda (2): Update / progress report on the current 'live' NTS related consultations / investigations: (Ofcom/All)

   * PRS Scope Review

Jeff Loan sent his apologies and as a result there was no new update available for the Focus Group.

   * NTS Retail Uplift and PRS Bad Debt Surcharge:

Geoff Brighton reported that BDO has submitted its report to BT which has been asked to comment upon the findings. In the meantime BT has also issued a pricing notification with a replacement figure. Ideally Ofcom would simply ask BDO to look at the calculations behind the new figure. However BDO was contracted principally to comment on the suitability of the initial BT rate of 9.09% (Check) and redirecting BDO to examine the latest rate will require contract renegotiation.

Justin Hornby asked if the misallocation of some NTS bad debt against PRS would require a re-consultation in respect to the Retail Uplift. Geoff indicated that this was possible, but that he hoped that such a re-consultation would not be necessary.

   * NTS Review

Markham Sivak was unable to attend the meeting as BA industrial action meant he had been unable to return from the US. A consultation document is expected summer or September with a Statement of Intent still expected to be published at the end of the year.

The expected Section 135 Information Requests are still in the process of being written and their recipients identified. The most likely date is now after Easter. Geoff promised to check after being asked whether it was still the intention to publish a pre-consultation document.

   * NCCN 500

Geoff informed the group that a draft determination was expected to be published on 20th April.

   * 080 Termination Rate Dispute

It was confirmed that a Determination to the 080 termination rate dispute had been published shortly after the last Focus Group on 5th February 2010.

   * 0845 / 0870 Termination Rate Dispute

Mention was made of this dispute between Vodafone and BT. Geoff indicated that the target date for issuing a draft determination was 21st May.

Stephen Ornadel raised a query in relation to the 080 Determination and whether 080 rates which were not charged for at the retail level should be included as part of the ladder pricing mechanism. Stephen argued that this traffic should not be averaged in to the overall calculation. Geoff agreed to take the issue away.

AP1 Apr 2010: Geoff to provide guidance to Stephen regarding the inclusion of 080 traffic where no charge has been made at the retail level in any ladder pricing calculation.

...



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Re: NTS Focus Group Minutes - Mar 18, 2010
Reply #1 - Jun 9th, 2010 at 12:27am
 
...

Agenda Item (3) NCCN908, 958, 985, 986 and 1007 0800, 0845 and 0870 transit charging (All)

Sean Hartley took the Focus Group through the previously circulated slide (see attached) in relation to BTs ladder pricing. From BTs perspective it is the terminator which is setting up the number and driving value, therefore the money should flow through to the Service Provider. BT does not believe that this is happening and as a result it has introduced ladder pricing (variable wholesale charges according to the level of retail charge) through the NCCNs listed above.

Transit calls have always received BT pricing and BT would like to be able to set a default termination price. Either BT is free to set a rate or operators are free to set their own rates; it is a simple either / or.

Claire Robinson asked how the billing would work? Stephen furthered this point by asking how BT could charge by a mobile operators retail price when even T-Mobile didnt know the retail prices of those MVNOs using its networks. MNOs according to Stephen fluctuate their price points on a monthly basis and he questioned how BT was able to bill such changes? The developments were in his opinion only going to exacerbate the current difficulties. Not to mention that the prices charged by MVNOs and for international calls are very different to those charged by T-Mobile at a retail level and that fluctuation in their pricing could affect the band charges. Stephen argued that the smaller gaps between tiers in BTs NCCN 1007 pricing ladder means that monthly fluctuations increase the chances of an operator moving between pricing bands from one period to the next in comparison to the wider bands of NCCN956.

Stephen acknowledged that there were no precedents for BT billing in this manner and whilst he found the offer of BT to act as a regulator interesting it was felt that applying such a model without consideration would only lead to chaos in the marketplace.

Andy Martin responded that MNOs should simply reduce their charges for calling 080 numbers to which Stephen responded that the mobile market was competitive and therefore it was inappropriate to constrain MNOs in this manner. Geoff concurred that Ofcom would need to be able to justify any attempt to regulate the mobile market on competition grounds.

There followed a debate on the exact pricing charged by mobile operators for calls to 080 numbers with Stephen responding from T-Mobiles perspective.

Warren Berdo argued that the PRS Scope Review has recognised that there was a growth in mobile usage and pointed to the price transparency measures taken on 0870 for calls which cost only between 7 and 8ppm. He contrasted this with the confusion caused to consumers by the mobile operators charging between 30 and 40ppm for a freephone call. Stephen pointed out that any 080 call for which there is a charge has an announcement played before the start of the call as demanded under the Numbering Plan.

Thomas Gransaalke agreed with Stephen and asked why BT was introducing pricing which penalised originators. Pete Farmer suggested that it was a financially compelling argument and recommended an approach which allowed revenue share once the fair and reasonable costs of origination were covered. Stephen highlighted that the impact would affect those organisations which had arranged with the mobile operators for their calls to be made at no charge, citing DWP and THA organisations who had different commercial arrangements to ensure no retail charges were applied. For THA in particular MNOs would be operating at a loss. Sean indicated that BT had always been willing to discuss the implications of NCCN911.

Justin asked BT how they believe they had met the third condition in relation to NCCN 956 in light of the Focus groups debate and how it could be practicable to bill. Claire also introduced the impact the changes have on the transit market where Cable&Wireless Worldwide is forced to price at the highest possible rate as there is no billing solution in place.

Stephen added that BTs use of publicly available information had essentially been given the ok by Ofcom, however it would be entirely impractical to require T-Mobiles Financial Director to regularly sign off average T-Mobile and wholesale rates.

Sean asked how Stephen was able to prove that the average rate would move between tariff bands each month if T-Mobile was unable to calculate its average price. Stephen responded that he had modelled scenarios from an un-assured database which revealed the various changes across the mix. Such information would not be robust enough to be signed off by T-Mobiles Financial Director as being accurate. When asked why T-Mobile could not take a longer period Stephen responded that they bill from actuals not approximations. T-Mobile require to be charged the right amount and not to have to continually catch up in terms of billing particularly as some of their MVNOs are very sizable with millions of customers and therefore it has a significant impact. Doubt was cast upon the difference in pricing between MNO and MVNOs.

Andy asked Ofcom to confirm that their intention was for 080 calls to be free or as close to free as possible and stated that Ofcom should step in. Geoff agreed highlighting the forthcoming review and stated that the disputes were necessary sticking plasters ahead of the review.

...
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Re: NTS Focus Group Minutes - Mar 18, 2010
Reply #2 - Jun 9th, 2010 at 12:29am
 
...

Claire asked Ofcom whether they believed condition 3 of the 080 termination rate determination had been met and cited a letter to Stuart MacIntosh that Cable&Wireless Worldwide had submitted. Geoff was not aware of the letter but felt that it was something that could not be looked at ahead of a dispute. He agreed to take the matter back internally and to feedback to the Focus Group.

AP2 Apr 2010: Geoff to provide guidance as to whether Ofcom can comment on the suitability of NCCN1007 in light of the conditions set out in the NCCN958 determination.

Sandra Reid agreed that the current status was far too complicated for it to be billed accurately.

Andy asked Nancy Scott-Picton about the BT Retail price changes from 1st April and enquired when operators could expect to see the increase in minimum call set up and other changes reflected in the POLOs. Nancy replied that BT Wholesale was awaiting information from BT Retail, but as soon as that was received it would be a further two and a half weeks.

Agenda Item (6): Review of remaining outstanding actions

There were no actions from the previous meeting.

Agenda Item (7) AoB

Kath Embleton asked whether Ofcom was minded to look at the question of porting differential at an industry wide level.

Stephen asked BT to confirm whether they are aware of the issues caused in porting terms by charging according to the CLI. Sean confirmed that was the case. Claire asked BT to confirm that billing was done by CLI. Sean responded that was the future plan but at present billing was being done by route.
Date of Next Meeting:

29th April 2010

Summary of New and Outstanding Actions:

AP1 Apr 2010:      Justin Hornby to propose new meeting date for 2010 at the next Focus Group.
AP2 Apr 2010:      Geoff to invite Markham to the next Focus Group

[end]

Agenda items 4 and 5 ??
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