Our friends at the Office of Communications have been accused of “flip-flopping” before. Actually, there’s a subtle industry insider pun in that sentence – for the first person to get it, I’ll do 30 minutes of consultancy pro-bono!.
The latest accusation of a u-turn comes in the form of the Reactive Save prohibition.
A few years ago, Ofcom felt that there was a degree of consumer harm created by allowing a losing provider (the provider whose customer was switching away) to be able to induce them to stay when they found out they were leaving. I say “Ofcom felt”; this was of course backed up by evidence, an analysis of the evidence and a consultation. All of this convinced them to effectively outlaw this activity by way of a new General Condition [note]GC22.15[/note].
However, when Ofcom reviewed the General Conditions in 2017 (see §4.11), it removed the prohibition. Upon re-examining the issue and seeking the views of stakeholders, broadly, Ofcom felt the underlying requirement for prohibition was (I paraphrase) less concerning now and it has been removed effective 1st October 2018.
This comes with a big “but” though. There has always been a general prohibition on using information gained in negotiations for network access General Condition 1.3 as numbered today (A1.3 as renumbered from 1st October 2018) for purposes other than it was intended, for which there is case law to say that this includes switching. So if the losing provider becomes aware that a customer intends to switch from a number portability order submitted by the gaining provider, it cannot use that “heads up” to perform a reactive save.
However, Ofcom have stated that they will not view enforcement of this Condition as an administrative priority (unless there are extenuating circumstances, like contacting customers that have made it clear they don’t want to be contacted). Administrative priorities are the statutory basis upon which Ofcom allocates its finite resources, and generally speaking it’s about addressing the most harm per unit of resource expended.
So, for now, Reactive Saves are still technically banned, depending on how the losing provider learns about the intention of its customer to switch. However, Ofcom won’t take enforcement action against this breach. Unless the breach is serious.
Reading and understanding the rules of a jurisdiction are very important in telecommunications, but the context can be equally as important in effectively implementing changes. Feel free to drop us a line if you’d like to talk over Reactive Saves or any other aspect of regulation in your business.