BT is to invest £1.5bn in fibre optic cables, giving up to 10 million UK households access to faster broadband.

The plans would bring 40% of homes in reach of an ultra-fast service by 2012.

BT is also planning to put fibre-optic cable into about 1 million homes, making the service even faster for those customers.

However, the communications group has made clear it will only make the move if regulator Ofcom allows it to get a decent return on that investment.

Remaining customers would be offered broadband speeds of between 40 and 60 megabits a second (mbps), it said.

In order to pay for the project BT has said it will suspend its £2.5bn share buy-back programme in July - by which time it will have returned more than £1.8bn.

‘New chapter’

“Broadband has boosted the UK economy and is now an essential part of our customers’ lives,” said BT chief executive Ian Livingston.

“We now want to make a step-change in broadband provision which will offer faster speeds than ever before. This marks the beginning of a new chapter in Britain’s broadband story.”

But the firm has warned that conditions need to be right for its investment.

BT has urged Ofcom to nurture a “supportive and enduring regulatory environment” which includes removing current barriers to investment and making sure that anyone who chooses to invest in fibre optics can earn a fair rate of return for their shareholders.

A spokesman for the firm said BT hoped to discuss updating its current universal service obligation with the watchdog.

Under current rules BT must provide a copper connection to all homes, however, the firm says this is out of date and unnecessary for updated services based on a fibre-optic connection.

BT’s rival Virgin Media already uses fiber-optic cables, which are faster than BT’s copper lines.

Meanwhile, other BT competitors including Carphone Warehouse and BSkyB are switching clients to their own networks so they do not have to rent copper lines from BT Wholesale.

Better returns

BT’s spokesman also added that the business would be hoping to get a better return on its fibre operations as it would represent a riskier investment.

“At present we are allowed a 10% return on the capital put into our Open Reach service, we would be looking for more than that,” he added.

Britain has been slower to invest in fast broadband than some countries, with BT in particular cautious about spending the large sums involved.

The group’s plans should enable homes to run so-called “multiple bandwidth-hungry applications” which would enable some family members to watch high definition movies while others were gaming or working on complex graphics projects.

Broadband comparison service broadbandchoices.co.uk welcomed the move saying it showed BT’s commitment to bringing the UK’s broadband service “up to speed” and provide better coverage for users in both rural and urban areas.

SOURCE: BBC News

Dealer association to complain about new Orange clawback policy and other grievances to Ofcom’s competition unit

The Independent Mobile Phone Dealers Association (IMPDA) said it will bring up Orange’s new clawback policy at a meeting with Ofcom’s Anti Competitive Behaviour Committee on July 15.

Orange announced on July 1 it will clawback 100 per cent of dealer sales commissions on customers failing to make more than 10 minutes of calls per month.

A Mainline bulletin warned dealers: “There must be a reasonable level of genuine and regular call/data usage. A connection must make an average of at least 10 minutes per month of outbound calls (or equivalent value data usage) over a rolling three month period to be considered ‘active’. Below this, the connection will be deemed ‘inactive’.”

IMPDA chairman Chris Caudle said: “You can understand commission being taken if a customer is fraudulent, doesn’t pay or disconnects, but this isn’t right.

“What if a customer is in hospital, or doesn’t want to be contacted? Dealers should not be punished for this.

“I understand Orange clawing back some commission if a customer moves to a lower tariff, but 100 per cent is ridiculous. Reducing it to the amount it was worth at point of sale is acceptable.”

But an Orange spokesman responded: “We believe the changes made are fair as we are looking to overcome the issue of ‘phantom connections’; connections made, but never actively used.

“They are most common when connecting SMEs who have a master handset with a number of other users on the account. This can mean we pay a commission to dealers for connections which are sometimes never used.

“As we are in a hugely saturated market our focus has to be on the quality of our new and upgrade connections, rather than just the quantity.”

SOURCE: Mobile News International

Ofcom have today released a consultation on the Alternative Dispute Resolution (ADR) and Complaints Handling Procedures to evaluate inadequate or inappropriate procedures that could cause detriment to consumers. The review looks in to the ability of consumers to exercise their right to take a dispute to ADR as well as balancing the ability with the costs.

General Condition 14.7 states that every communication provider (CP) must be a member of an approved ADR scheme, and must comply with the rules and decisions made by the ADR scheme. General condition 14.4 also requires communications providers to have a complaints handling code, which is approved by Ofcom.

Alternative Dispute Resolution
The ADR process is open to consumers and small businesses (under 10 employees). Currently, to invoke the ADR process, a complaint must either run for 12 weeks or until a “deadlock letter” is issued by the communications provider. A deadlock letter indicates that the CP does not believe that the complaint will be resolved without going to ADR.

Responses to Ofcom’s information request of CPs found that the majority of complaints are resolved within 8 weeks if they are able to be resolved, and only 10% of complaints still unresolved at 8 weeks are resolved by week 12. Accordingly, Ofcom is proposing changes such that the ADR schemes accept a complaint eight weeks after a complaint is first received, or earlier if a deadlock letter has been issued. This would bring forward the time for resolution to a problem which would be welcomed by consumers, particularly if the last 4 weeks tend to make little headway into resolving the problem.

ADR Awareness
Research by Ofcom into consumer awareness of ADR schemes shows that it is at an unacceptably low level with 81% of UK adults aged 15+ in 2006 not aware of either of Otelo or CISAS, with 83% unaware in 2007. 5% of 15-24 year olds said they had heard of at least one. Of lower income groups (below £17.5k annual household income), only 9% were aware, whilst 20% of those earning £17.5k - £30k had heard of CISAS or Otelo.

Ofcom is proposing to help improve this knowledge of ADR schemes and one step towards this is requiring a CP to give written notice about ADR five working days after a CP first receives a complaint, unless the complaint is resolved at first point of contact. It should also give written notice eight weeks after the complaint is received if not resolved, or when issuing a deadlock notice.

Complaints Handling Procedures
Ofcom believe that the current regulation of complaints handling is not as effective as it should be. A significant proportion of complainants are very dissatisfied with the way their complaint is handled. To address this, Ofcom is proposing a single Code of Practice (COP) setting out high level mandatory standards that each CP would have to adhere to as a minimum. This would be a change to a single code of practice that all providers would abide by rather than the current system where each providers gets their own code approved by Ofcom.

The accessibility to complaints is another concern, and Ofcom have looked into the options of requiring CPs to have either a free phone number of a geographic call rate number for making complaints. They do not believe it fair that CPs can make money via revenue share of, for example, 0870 or premium rate numbers when users are making complaints, but do believe that a reasonable cost to the consumer would be acceptable.

To be able to ensure that CPs are compliant with the proposed regulations if implemented, Ofcom are proposing that CPs should have new record keeping obligations. At the very least, they should log for 15 months a minimum of: details of the complainant, including name and address; date on which the complaint was first received; a description of the complaint; and a description of how the CP dealt with the complaint.

Whilst these are just proposals for changes at the moment, assuming there isn’t a large amount of uproar from communication providers about these changes, it is not unreasonable to expect these to come in to force in the not too distant future. Written views and comments are to be received by the 4th of October 2008. If anyone is currently having issues with their broadband provider, we suggest a look through our guide on resolving a problem which contains advice on the steps you can take.

SOURCE: ThinkBroadband.com