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ISPs call for clarity on automatic compensation proposals

Posted by Sam Frances on Friday, August 12th, 2016 at 15:56

ISPs call for clarity on automatic compensation proposals

Broadband and mobile ISPs have called for greater clarity on proposals to grant consumers the right to automatic compensation for broadband or mobile outages.

In response to Ofcom’s consultation on the topics, many respondents raised concerns about the complexity of apportioning responsibility for outages, and in identifying those affected, especially if end-users are to be compensated automatically, without first raising a complaint.

The latter problem is particularly pronounced in the case of mobile operators, as Vodafone pointed out in their response:

If a mast goes out of service we cannot identify the customers connected to it as it is no longer communicating with the rest of the network.  … Also, as the network is built with overlapping coverage, for most mast outages (exception are very rural masts of course) the customers will often not “feel” the impact on the service.

Discussions of automatic compensation in the context of fixed line ISPs exposed tensions between the perspectives of retail ISPs and their wholesale suppliers. The former tended to argue that any compensation scheme should take into account the fact that outages can result from problems with upstream providers.

For any sort of standard compensation to end users for situations where there is a fault in the back-haul and broadband access it is essential that carriers have to work to the same definition as the ISPs and offer the same level of compensation. Without this, the ISPs take all of the risk and cost with no actual means to improve service or address the faults.
— Andrews & Arnold

The differing perspective of wholesale providers, on the other hand, was evident from BT’s response:

The question of whether retail CPs receive commercially-negotiated redress payments from their suppliers when things go wrong does not need to be considered by Ofcom in the context of a consultation on consumer compensation. The relationship between a retailer and its wholesale suppliers, and the commercial arrangements between them, whether the latter are regulated or not, is an entirely separate matter to the relationship between the retailer and its end customers.

At the most fundamental level, questions were raised about the wisdom of applying to ISPs a model of consumer compensation designed for utilities such as water, gas and electricity.

One common issue we encounter when discussing policy matters regarding “Internet” is the misconception that an Internet access service is in any way like other utility services such as gas, electricity, water, etc.

We feel sure than OFCOM know this already, but Internet access is a service which varies massively from provider to provider. The physical access means, the nature of the service itself, the quality of the service, the reliability of the service, are all differences which ISPs can use to differentiate themselves from other ISPs.
— Andrews & Arnold

For more information, see: ISPs Raise Concern Over Automatic Compensation for Broadband Faults - ISPreview

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