Small businesses could benefit from telecoms regulator Ofcom's
plans to facilitate the introduction of new low-cost voice over
broadband services in the UK
Small businesses could be set to make substantial savings on
telecoms costs through the use of voice over broadband
technology.
Telecoms regulator Ofcom has launched a consultation on how best to
deliver voice over broadband (another term for voice over IP)
services to a wider market.
VoB systems allow users to bypass the public switched telephone
network, where normal phone charges are incurred. Users can do this
using software and IP-enabled phones.
Broadband can offer significant cost savings and higher bandwidth
than traditional leased lines for small and medium-sized
organisations with branch offices.
Changes to phone numbers
Ofcom will complete its consultation in November, but it has
already made some key decisions about phone numbering that will
take forward an idea promoted five years ago, when the first
broadband services appeared.
Then, niche firms sprang up selling hardware and software to allow
the first digital subscriber line users to make voice calls over
their broadband lines. But the technology failed to break into
general use because none of the major phone providers signed up to
the products on offer.
Ofcom has made it easier for new providers to compete with existing
phone operators by ruling that users wanting a VoB service will be
able to either use their existing geographic phone number, an
alternative 01 or 02 prefix, or an 056 prefix denoting that the
number used is a VoB number, rather like 07 to denote a mobile
phone.
The 056 number is particularly useful as it has full number
portability, meaning that a user with an IP phone plugged into a
wireless-enabled laptop operating over a mobile network could make
a free call from any location over the internet to another 056 or
VoB-enabled number.
Low-cost services
Ofcom is bullish about VoB's prospects. It said, "Ofcom believes
the emergence of these services will offer important benefits to
customers.
"Call costs should reduce significantly. Where a call connects from
one VoB service to another, the only cost to the consumer is
typically a standard monthly fee for the line, regardless of
whether the call is to the next town or to the other side of the
world."
VoB services also include new features such as sophisticated call
handling and messaging, multi-party conference calling and video
calls.
The relatively low cost of the technology needed for VoB also means
that the barriers to entry for new companies are lower than those
in traditional switched-circuit telephony.
In addition to the numbering decisions, Ofcom has agreed that new
providers will not necessarily have to adhere to established
technical and service norms that traditional services have to
satisfy, including the costly provision of an emergency services
999 facility.
"Ofcom's approach is intended to minimise the regulatory burden
associated with the creation and delivery of new voice services,
while ensuring that providers benefit from fair and effective
competition in the infrastructure markets on which they will
depend," the regulator said.
Ofcom chief executive Stephen Carter said, "Broadband voice
services are a new and emerging market. Our first task as regulator
is to keep out of the way. As the market develops, we will ensure
that consumers are appropriately informed and protected."
Users, analysts and providers have so far welcomed Ofcom's approach
to VoB.
Protecting the users
Michael Dixon, leader of the Communications Management
Association's special interest group on billing, said Ofcom's
thinking was broadly in line with the CMA's, but that certain
caveats would have to be put in place to protect users'
interests.
For instance, Dixon said, "Charges to call these numbers must be
part of normal charging plans, ie within BT Together or bundled
mobile operator rates. There is already enough antagonism as a
result of perceived operator greed."
Stefano Nicoletti, an analyst at Ovum, said regulators in other
countries may copy Ofcom's hands-off approach, but he warned
against users being able to take geographic numbers with them if
they moved out of the location the prefix is attached to.
Such a scenario, said Nicoletti, would have a "disruptive impact on
the numbering system". The German regulator has already ruled
against this happening following attempts by providers to offer
users a selection of city-specific numbers.
The global view
Japan has six million voice over broadband users, the US has
220,000 and Europe has 100,000, but there are only 10,000 in the
UK. Most of these domestic customers use freeware solutions such as
Skype.
Widespread "local loop unbundling" is the main driver for VoB
adoption, where new providers are able to offer completely new
broadband lines and services independent of established telcos.
Less than 0.03% of UK phone lines are currently unbundled.
The Internet Telephony Service Providers Association, set up to
support new providers in the fledgling VoB market, welcomed Ofcom's
stance, but said the general question of number portability still
had to be decided.
Eli Katz, founder member of the association, said, "Key issues have
been addressed but others remain, including number portability and
the commercial viability of ported numbers.
"Under the current 'onward routing' charging method, the ongoing
costs for portability are a significant barrier to porting which,
in turn, is a significant barrier to the mass market, at both the
consumer and business level."