Last year, the UK telecommunications watchdog, Ofcom, “put the industry on notice” in relation to games being played in number portability.
This was in no small part as a result of two decisions; the Cloud M case and the Gateway case.
These are not large telecommunications companies. Indeed, in its press release, Ofcom acknowledged this. We are not aware of Ofcom having ever sanctioned any major provider for these breaches, but they still took a decidedly confrontational position.
Ofcom wrote to the Office of the Telecommunications Adjudicator (the “OTA”). The OTA is an interesting title for a body which has no adjudicatory powers, it is instead a body that convenes interested parties from the industry and is funded jointly by Ofcom (by extension, that means the rest of the industry) and BT.
Ofcom made their position in that letter on using their powers relatively clear.
We understand that some in the industry have asked about Ofcom’s role in supporting industry’s detailed processes and specifically have asked whether Ofcom could do more to require all telecoms providers not just to comply with the General Conditions but with industry processes. The technical and order handling processes for portability should rightly be owned and maintained by industry rather than by Ofcom, and we encourage their continued development through shared industry experience and expertise. We recognise the value of industry processes as a guide to what constitutes best practice in the context of number portability. In the past, we have referred to these in considering disputes or complaints and will continue to do so where they are relevant. However, explicitly requiring compliance with industry processes would have two risks. Firstly, it may impede enforcement where industry processes themselves are insufficient to enable number portability. Secondly, it would risk placing telecoms providers in breach of a regulatory obligation for providing effective number portability in a slightly different – and perhaps even better – way than envisaged in industry guidance. We stated this in 2006 and we continue to stand by this position.
Rightly, Ofcom acknowledge that intervening more specifically may curtail innovation, but that can be handled through enforcement guidance, administrative priorities or appropriate wording in a condition.
Since 2006, Ofcom have maintained this position. For 13 years the industry has reached repeated impasses on improvements to number portability. Ofcom’s attempt to mandate improvement was overturned in court, and at least two other industries led initiatives (Porting UK, NP4UK) have not succeeded. If Einstein were alive today, he’d probably have a wry grin at the definition of insanity often accredited to him;
Doing the same thing over and over and expecting different results
The industry’s frustration at Ofcom’s position will not be news to them. In its recent consultation “Promoting Trust in Telephone Numbers“, Ofcom, started to examine the potential of technical solutions to CLI Authentication and number portability.
However, it would appear that a sizeable portion of the industry considers that Ofcom may be missing the point somewhat. Some quotes from a selection of the responses are helpful in illustrating the sentiment in the industry at Ofcom’s latest approach;
From what Ofcom have so far outlined, we see no reason why a central database (or blockchain equivalent) would do anything to solve these problems in isolation.
Ofcom’s attitude to number portability has been one of expecting that the class will behave itself whilst the teacher is on an extended break. Clearly, in the last decade, the industry has been unable to resolve the problems itself and continuing to expect that the vested interests that have historically frustrated progress will magically resolve themselves is folly.
This is not an exhaustive list; however, what is clear is that these are not simple questions, and neither would a central database (or distributed ledger technology) address them on its own. These are questions regarding the regulation or the interpretation of the regulation.
So, there is a distinct feeling in some quarters that Ofcom’s cart is ahead of its horse, so to speak. Moreover, that Ofcom’s focus on distributed ledger technology means it is not trying to address the root causes of the problems experienced. But just like it’s apparently insane to expect the outcome of work on number portability to be different this time, it is as equally insane to expect the regulator to budge from its position when told the same things again.
Which brings us back to their 2018 edict about portability we started this piece with. What is it, and what does it mean?
Very broadly, at the behest of the regulator, the industry has developed a process whereby a problematic port order can be forced through after a panel of 3 wholesale communications providers has convened and reviewed the evidence on the legitimacy of the port.
There is no regulatory stipulation that this is a lawful practice; no statue that can be pointed to that makes it above board, merely the end to end process manual having a new appendix.
This manual, as Ofcom stated in their letter which is quoted above, is not part of the regulations, but is merely best practice. The industry-standard template contract says;
3.1. Subject to the provisions of this Agreement, the Parties will provide the Number Portability Service in general accordance with the relevant Process Manual(s) where reasonably practicable, taking into account technical, operational and financial considerations [..]
Which means there is not likely to be a contractual obligation to follow this process, and those involved will be accepting, themselves, the entire risk or reward of the outcome.
What if a port is forced through and it turns out not to be legitimate? That would mean a loss of service for the legitimate user, who, invariably, will take issue (and potentially litigate) against their provider. Their provider, who was wronged would invariably take issue with their wholesaler, who would take issue with the original range holder and so on and so forth.
Absent the entire industry renegotiating its nexus of contracts with each other for number portability and ensuring all of its reseller agreements, and end-user agreements, can accommodate this process (and importantly this process going wrong), there is a significant potential for problems down the road.
Ofcom may be able to use its discretion in enforcement if this process were to go wrong and shield parties from sanction, but it would struggle to shield them from civil liability at the County Court or High Court, for example.
We hope that the process isn’t needed; we are aware of many CPs that have always worked together to resolve the problems this process is intended to solve without recourse to third parties, including Ofcom. If it is used, we hope that it doesn’t come back to haunt well-intentioned providers trying to do the right thing.
Which brings us to the final point; Ofcom has powers to intervene in the arguments that will be brought in a port override process – Sections 96A and 185 of the Communications Act 2003 being two such examples. In asking the industry to act as judge, jury and executioner for issues under its own statutory remit (which is backed by a £200m annual budget), Ofcom truly is expecting the classroom to behave itself in its absence. What could possibly go wrong?
As ever, if you think we might be able to help you with anything arising from this piece, do feel free to get in touch for a no-obligations chat.
