BCS, The Chartered Institute for IT. Consultation Response: Department for Culture, Media & Sport. Tackling Partial Not-Spots in Mobile Phone Coverage

Transcription

1 BCS, The Chartered Institute for IT Consultation Response: Department for Culture, Media & Sport Tackling Partial Not-Spots in Mobile Phone Coverage Dated: 26 November 2014 BCS The Chartered Institute for IT First Floor, Block D North Star House North Star Avenue Swindon SN2 1FA

2 About BCS, The Chartered Institute for IT BCS is governed by a Royal Charter which defines our purpose: to promote the study and practice of Computing and to advance knowledge and education for the benefit of the public. We bring together industry, academics, practitioners and government to share knowledge, promote new thinking, inform the design of new curricula, shape public policy and inform the public. The Royal Charter enables the Institute to admit qualified members; without our 70,000 members we would be unable to undertake many of our charitable activities to promote IT at all levels. Under the Charter, BCS is required to establish and maintain standards of professional competence, conduct and ethical practice for information systems practitioners. As a professional body, BCS represents its members and the IT Profession as a whole on issues of importance, and liaises with other professional bodies, the government, industry and academics to initiate and inform debate on IT strategic issues. We also deliver a range of professional development tools for practitioners and employees and as a leading IT qualification body; we offer a range of widely recognised professional and end-user qualifications. Page 2 of 8

3 Consultation Document: Consultation Questions: 1. Do you agree that there is a need to improve the coverage of voice and text services in partial not-spots and that Government should seek to extend such coverage? BCS believes that full coverage of voice and text services in partial not-spots is vital. As a developed and densely populated country the UK is a prime market for Mobile Network Operators (MNO) (in terms of providing cost-effective services). It is not unreasonable, therefore, for them to be required to address all local not-spot issues. This is essential for reasons of safety, democracy and community cohesion, avoiding a sense of being a second-class citizen if mobile coverage in your home area is poor. It is also essential for the provision of public and private sector services, bearing in mind the savings and other benefits in moving towards on-mobile, digital by default service provision, including those involving mobile access by objects, as well as people. Opportunities have been lost already in spectrum licence conditions, which should have mandated full coverage or sharing arrangements to enable customers to achieve full coverage via infrastructure sharing. Infrastructure Sharing 2. To what extent are sharing arrangements scalable beyond the simplest sites that could be shared? BCS believes that sharing arrangements may well be scalable beyond the simplest sites that could be shared. However, extension to existing sharing arrangements can only be addressed by the MNOs in agreeing a mutually acceptable business solution. 3. Would the draft Direction to Ofcom at ANNEX A be effective in requiring sharing at all sites where there would exist a potential coverage benefit. BCS believes that sharing should be extended to all sites, regardless of coverage benefit, since the optimum quality of service and minimized capital expenditure requires universal sharing, giving the flexibility for users to connect to any network. 4. To what extent would the costings referenced in paragraph (54) be generally applicable to all sites at which sharing may be required by the coverage obligation? BCS believes that a proportionate increase in cost for improved coverage to be reasonable. However, market demand and consumer perception of value for money will determine customer willingness to pay and thus the manner of cost recovery model adopted by the MNOs. 5. To what extent do you consider mast sharing will achieve sufficient improvements in tackling partial not-spots? BCS believes that the likely improvements from mast sharing will be insufficient in tackling partial notspots while still incurring ongoing duplicated antennae costs. Page 3 of 8

4 MNO-MVNO 6. Would the draft Direction to Ofcom at ANNEX B be effective in enabling the creation of multi-operator MVNO offerings in the UK, and why? BCS believes that the draft Direction to Ofcom could be the stimulus and legislative enabler in the creation of multi operator MVNOs but meaningless without the active support and enterprise of the private sector. Potential MVNOs need to assess the market potential and consider the partnerships necessary to deliver a successful business solution. 7. To what extent would the costings referenced in paragraphs (59 and 62) accurately represent the cost of establishing an MO-MVNO as described? BCS believes that while the operational costings referenced in paragraphs (59 and 62) represent the start-up costs of establishing an MO-MVNO investors and partners will require a realistic business model to determine their return on investment which may prove more problematic in the present political climate. 8. Are there any practical considerations for the two MNO-MVNO models described in paragraph 58 that would favour either as a solution for partial not-spots? BCS believes that the two models proposed are feasible but both present some setup and operational problems. A full national MVNO with its own core network infrastructure: While operating wholly within the UK, it would need to reach agreements with multiple host MNOs (and potential competitors) to provide a service where subscribers phones connected to a single preferred host MNO or to a range of partner MNO; which ever provides the strongest, signal while the itemised customer billing functionality is provided by the MVNO. A complex model, requiring the cooperation of a number of commercial partners with some critical dependencies plus a questionable profit model. While the international MVNO relies on international roaming agreements negotiated at more favourable prices, a third party would provide billing services; the cost of which would be factored into the consumer offering. A simpler model, but with less direct control and a high dependency on being able to negotiate a substantially cheaper international roaming agreement. National Roaming 9. Do you consider that national roaming should be implemented in the UK? BCS believes that national roaming should be implemented in the UK. This is essential for emergency services, including those involving mobile access by objects as well as people. It is acknowledged that there are indirect consequences from national roaming, depending on how it is implemented, and these need to be worked through in consultation with users to avoid costly solutions and undesirable confusion in functionality. It should be clarified how voice (and subsequently data) connections would be handled when switching from coverage by phone operator to another. Alternative options, which are functionally equivalent, should not be excluded from consideration. Page 4 of 8

5 10. Do you think the draft direction at Annex C will be effective in delivering national roaming? BCS believes that effectiveness of the directive in delivering national roaming will depend on the reaction of MNOs and their willingness to cooperate. 11. Should there be a mechanism for controlling maximum prices for roaming minutes, and should this be at the site level described above and in the Schedule to the draft Direction? BCS believes that roaming charges for calls should be eliminated, as they will be internationally (initially within the EU, but subsequently globally). It would be unreasonable to levy national roaming charges when international roaming charges are zero and would lead to arbitraging. 12. To what extent does the method described above for determining the cost of providing voice roaming services accurately capture the cost base associated with the service? BCS believes (from the position of an observer) that the method described for determining the cost of providing voice roaming services accurately captures the cost base associated with the service to be reasonable. However the MNOs will view the model from a better informed commercial position and it is they that must agree and accept the legitimacy of the model. 13. Should there be a mechanism for controlling maximum prices for roaming SMS services? BCS believes that SMS roaming charges should be zero. It would be unreasonable to levy national SMS roaming charges when international roaming charges are zero. 14. To what extent are agreements between landlords or wireless infrastructure providers and MNOs a limiting factor in pursuing passive infrastructure sharing, multi-operator MVNOs, or national roaming? BCS believes there are risks that the loss of potential revenue from multiple masts might deter a landlord from agreeing to passive infrastructure sharing. This is the challenge that must be addressed by the MNOs in agreeing mutual beneficial sharing agreements that deliver improved customer service. 15. Following our technical advice we have assumed that roaming could be operational by the start of 2016, a Multi-Operator MVNO could be operational by mid-2016 and passive infrastructure sharing could be operational by the start of Are these proposed timings feasible and to what extent can they be accelerated? Based on the information provided in the proposal BCS believes that the proposed timetable is realistic. Considering the desirability of the programme, BCS would welcome acceleration of the stages, where practical, particularly national roaming. However technical solutions can only enable business change, the introduction of new business models requires cooperation and the formation of new commercial partnerships. Page 5 of 8

6 Non-Monetised Costs 16. The risk of MNOs switching off unprofitable masts under roaming is assumed to be manageable through setting mast by mast prices. Is this a reasonable assumption, and would mast by mast pricing be an effective solution? Are there alternative solutions? Consumers select their MNO based on functionality, coverage, reliability and cost. Service delivery and infrastructure management is the domain of the MNO, who must ensure cost effective delivery of a quality service to the consumer. How the infrastructure is managed is the responsibility of the MNO, prescribed by the business model they employ. 17. Can you provide any evidence of the impact of roaming on battery life, dropped calls and loss of data service through 2G signal lock? BCS has no empirical evidence of the impact of roaming on battery life, dropped calls and loss of data service through 2G signal lock. However, anecdotal evidence suggests that the due to the adverse impact on battery life of searching for a reversion to the original operator after a hand-off should be avoided in any implementation. 18. To what extent could user customisation enable consumers to avoid these impacts? BCS believes that while user customisation may enable consumers to avoid these impacts it would require a greater level of user awareness and a potential reduction of operational flexibility. 19. Are there any other substantial consumer issues which roaming could cause which are not covered in the Impact Assessment? BCS believes that while quality of service is likely to improve significantly in terms of coverage and performance, it will also lead to greater investment in new mobile applications, an increase in traffic and demand for higher speeds. This will generate greater demand and revenue for operators to fund future generations of mobile networks. 20. What are the likely costs of ensuring that networks would be resilient to mass roaming where all the users of one network roam onto another in the instance of an outage on their network? BCS is unable to offer a realistic cost estimate based on the information at its disposal. The MNOs would be best placed based on their scenario modelling to provide such an estimate. Monetised Benefits 21. The benefits of roaming and infrastructure sharing have been monetised using willingness to pay (WTP) data for visitors to total not-spots, as described in the Impact Assessment. This assumes that visitors to a partial not-spot who do not have access to the network operating there experience this as a total not-spot. Is this assumption reasonable? BCS believes that full coverage of voice and text services in partial not-spots is essential in such a prime market place for MNOs as the UK. Consumers are seduced by the MNO s own marketing and Page 6 of 8

7 expect universal coverage, high reliability and low cost. In our highly competitive society consumers expect a low cost package price and do not like extras which they may well see as deficiencies of the MNO s service delivery. The MNOs have the technical solutions to hand; the problem is one of how the cost is shared. 22. Can you provide further evidence on the experience of visitors to a partial not-spot? BCS s evidence is largely anecdotal based on individual experience with no statistical basis. The frustration caused by partial not-spot denial of service saps trust in the technology and more specifically confidence in the MNO. This can lead to a reluctance to invest further in the technology until reliability is seen to improve. However, consumers see reliability as a right and would not wish to be penalised financially by any of the proposed solutions to partial not-spots implemented by the MNOs. Non-Monetised Benefits 23. Residents and businesses in partial not-spots are assumed to mainly benefit from additional choice of providers rather than additional coverage, as set out in the Impact Assessment. Can you provide any further evidence or data on this and other benefits to residents and businesses in partial not-spot areas? BCS believes that businesses also benefit from the ability to consolidate contractual arrangements into one contract, rather than fragmentation into different contracts for different areas with different suppliers. 24. The Multi-Operator MVNO option assumes there is sufficient demand from consumers to support such a solution. Can you provide any further evidence on the demand for such a service and the benefits that consumers might receive from it? While BCS has no experience based evidence to support the MVNO option, assuming sufficient demand, the proposal appears sound. Businesses would be able to consolidate contractual arrangements into one MVNO contract delivering potential efficiency and financial savings. However, this must be balanced against the downside of committing to one supplier for all your mobile needs while potentially sacrificing the flexibility of the free market. Additional Comments 25. Please let us know if you have any additional comments on this consultation. This consultation addresses an important area of concern regarding mobile services for businesses and the general public in the UK. It should be viewed, however, in the broader context of international mobile services, which are close to non-existent in any competitive sense. Business users seek to use mobile data communications increasingly for online cross border trade, and this is hampered by a whole range of obstacles afflicting the mobile market. This includes roaming charges, termination rates (mobile to mobile and fixed to mobile, inconsistent frequency allocation, auction costs passed on in higher prices, exclusive deals for devices with single operators, and high mobile data charges (especially outside contracted bundles). In order to fully enable the digital economy by the time of 5G roll out, a fundamental rethink is needed at international level, leading to a different industry structure with shared access infrastructure and service-based competition fit to serve the Internet of Things. Page 7 of 8

8 It is not clear why the requirement to eliminate partial not-spots in this consultation paper is restricted to voice and text services. It should be applied equally, but over a longer timescale, to data services as well. The MNOs should be given targets for 100% national geographical 4G coverage, including a defined service level for mobile broadband, with these made a licence condition (later to be extended to 5G). This is just as essential as the provision of fixed broadband to all the UK s population in order to ensure that people living in remote areas are not excluded from the benefits of on-line and onmobile digital services. End Page 8 of 8