Virgin Media response to - Arrangements for porting phone numbers when customers switch supplier

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Virgin Media response to –
Arrangements for porting phone numbers when customers switch
supplier

1. Summary:

Virgin Media 1 (VM) is pleased to respond to this consultation, as the issues raised are
important for the industry, the customer and Ofcom. It is crucial that a sensible and pragmatic
approach is taken to managing number porting going forward, one which provides consumers
with the appropriate freedom to switch supplier via an efficient and hassle free process, and
one which does not place unreasonable and dis-proportionate burdens on communications
providers (CPs) to implement and operate.

Although the current process for porting numbers works reasonably well, in VM’s opinion, in
that there are no significant barriers preventing consumers switching freely, we recognise that
an ACQ/CDB solution has potential benefits to all. VM therefore is supportive of the principle
of moving to an ACQ porting process, but we have some significant reservations about the
practicalities of doing so, and the timescales currently proposed by Ofcom. These concerns
and views are explored in detail below.

Because of these concerns, which were not removed during our recent meeting with Ofcom,
we would strongly request that Ofcom address the practical issues we see as major concerns
before firming up implementation plans, and as a result revisit the timescales proposed. To an
extent our concerns would be relaxed if it was clear that Ofcom were to take a pragmatic and
sympathetic view where CPs were unable to meet imposed timescales despite reasonable
endeavours to meet these. This is not a request for an open-ended implementation plan, as
this would inevitably result in continually extended delays, but a requirement for clear
recognition from Ofcom that their proposals are not yet sufficiently detailed or whole to enable
a robust calculation by CPs of the impact – both cost and resources – on them in
implementing the proposals. Without the latter it will be very difficult for any CP to justify the
budget required, particularly in the current economic and market climate.

This latter is particularly relevant when Ofcom has not provided any real justification for the
implementation of an ACQ solution. Consumer demand for an ACQ (as opposed to the
current processes) has not been quantified, and the Ofcom concern over a CP ceasing to
trade, while theoretically understandable, has not been borne out in reality with only Atlantic
failing over the past 6 years. This is not to say it will not happen again, but to justify an ACQ
implementation just on this has dubious validity. This raises the question whether the Ofcom
proposals would be proportionate or justified.

1
    In this response Virgin Media is commenting as a fixed network operator. Virgin Mobile may comment separately.

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We also wish to record our concerns around the seemingly narrow scope of Ofcom’s
considerations to date. While we concur that the technical and infrastructure aspects of the
proposed solution are a critical factor, we would suggest that the end-to-end process, together
with the complementing operational and commercial arrangements are equally important. In
this respect, we do not believe that it is appropriate for this initiative to be driven by the
technical fraternity in isolation. We believe that operational, process and commercial
considerations should be afforded at least equal prominence in the ongoing evaluation and
development activity. Without the inclusion of these parameters, CPs will be unable to
establish the true impact on their businesses and therefore whether the proposals are viable.

Therefore of the three Options listed in the consultation, Option C appears the most sensible,
with a caveat over the December 2008 deadline for populating a CDB.

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2. Ofcom’s Questions.

Question 1.
Ofcom has decided to require fixed and mobile providers to implement and populate a common
database to enable direct routing of calls to ported numbers. Do you agree that providers should
be required to achieve this by 31 December 2008?

1.1 VM believes that the proposed date of 31 December 2008 is challenging at best. To a large
extent it depends upon what Ofcom mean by “implement” and “populate”.

1.2 The current proposals appear to only refer to ported numbers, rather than all numbers within a
CPs number allocation. There is a definite belief within industry, supported by NICC and by VM,
that a CDB should include all numbers allocated to UK CPs, and to include certain aspects of
Number Administration. Not to do so could lead to inefficiencies and poor data quality, potentially
leading to failed calls – eg through missing or incorrect Destination Groups. The amount of work
required varies depending upon which approach is taken, with additional design specification,
implementation work and associated resources required if all numbers are to be included.

The database should include both fixed and mobile numbers. It would also be critical to confirm
what element of fixed-to-mobile porting would be allowed – current legislation is still not
sufficiently clear.

1.3 Another key issue is what is meant by a “Central” data base ? The Ofcom proposal appears to
indicate one central d/base accessed by CPs. A different approach – favoured by both NICC and
VM – is to use a common database solution where CPs may hold a managed image of the data,
maintained by reference to a central authority. For CPs not wishing to hold their own image of the
data, the common database solution should also support “real-time query” to determine the
routing for any number.

This then raises the crucial question of the design of the CDB. NICC are developing technical
options, but not against an agreed commercial product specification. NGNuk have briefly looked
at this, but have specified very little in detail – general product statements only – and are likely to
wind down in the near future. Without a detailed product specification it may be very difficult – if
not impossible – to produce appropriate documentation of sufficient quality to expect a supplier to
produce a relevant tender against. Also without a clear overall specification it is difficult for CPs to
adequately cost the implications on them in implementing access to a CDB solution.

1.4 The development, and certainly wide-scale deployment, of an ACQ/CDB is directly dependent
upon the general availability of NGNs. As discussed and agreed with Ofcom, implementation of
NGNs has slipped significantly when compared to the original, and even more recent, delivery
forecasts. This includes BT‘s 21CN project. Many CPs have yet to start implementation of NGNs,
certainly in any significant quantities.

Linked to this is the issue of whether relevant budgets for any NGN or CDB deployment have
been agreed by CPs’ senior management, without which progress will be difficult. It is probable
that CPs have not budgeted for CDB work in 2008, and in the current financial and market climate
obtaining additional significant funding for a non-revenue earning facility is likely to be a major
problem for most. This in itself could jeopardise the December 2008 timescale. Most CPs are
already under stretching financial targets with the development of new services etc. so there is
little – or no – unallocated money available.

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Thus it is highly likely that TDM legacy networks will remain the predominant technology in place
by late 2008. Not all TDM technology will support an ACQ direct routing solution and thus it is
likely that many CP’s networks will not be able to terminate direct routed calls by this date. The
decision on whether, and when, to implement this capability must be under the control of the
recipient network CP.

1.6 There is also the issue of cleansing the current porting databases to a consistent standard
across industry, which would require an industry agreement on processes etc.

1.7 Full operation of a direct routed porting process will require much more than just a “CDB”. For
a porting capability to work efficiently there is a clear requirement to design, check, and implement
a complete end-to-end process, which is not covered in the Ofcom proposals or CBA.
Included in this overall process would be the operational aspects of
• Number collation and monitoring – accuracy, currency, monitoring etc
• Performance – KPI setting and monitoring
• Resourcing – who, how managed, budgeting etc
• End-to-end processes – who produces, monitors ?
• Governance – who is responsible, who are they reporting to

Question 2
When setting the deadline for implementing and populating the database, should Ofcom
simultaneously set deadlines for using the database to deliver Direct Routing
of calls to ported numbers? If so, would it be appropriate to require mobile operators
to achieve Direct Routing of calls to ported mobile numbers by 1 September 2009
and require mobile and fixed operators to ensure Direct Routing of all other calls by
31 December 2012? Could this be done any earlier?

2.1 No. There is still too much uncertainty over the enablers that will be required to deliver a
functional direct routing process. There is no problem in Ofcom setting target timescales that are
“best endeavours”, but setting firm deadlines – with the implied threat of strong Ofcom
enforcement action if CPs fail to meet these – would be inappropriate at this stage.
It is recognised that Ofcom may feel the need to set some milestones otherwise timescales for
such projects can tend to extend continually. It may therefore be a question of how Ofcom would
react to a situation where CPs failed to deploy access to a CDB by the required/recommended
timescale. The “big stick” approach may be inappropriate in such circumstances bearing in mind
the uncertainties outlined above.

2.2 A key consideration is the justification behind Ofcom’s desire to implement an ACQ/CDB. As
has been stated VM is supportive of the principle on the basis it offers the prospect of a more
efficient porting process. However, the cogency of the drivers should dictate the timeframes within
which the CDB should be delivered.
Ofcom have offered two justifications,

(i) consumer demand. However no quantification has been provided, and the MR responses
included in the consultation do not provide an overwhelming case for the industry to spend
significant sums of money on a new ACQ/.CDB.
From VM’s perspective there is ample evidence that there are currently no significant barriers in
the way of customers porting, certainly from fixed lines. Our recent customer experiences show
we are porting tens of thousands of customer per month – both as imports and exports.
There are current problems with porting, but these predominantly appear to occur where CPs fail
to comply with agreed industry process – either through error or lack of proper application – rather

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than because the process itself not being fit for purpose. Recent Ofcom actions in this area are
designed to improve this overall situation ie mis-selling and MAC addresses.

(ii) the collapse of a CP – or significant disaster: While no one wishes to tempt fate and say this
will not happen, there have only been two significant occurrences in the recent past, so how likely
is this is unclear. Also other solutions – than needing a CDB - would be available to guard against
consumers being totally without service, particularly with the proliferation of mobile services – as
stated in Ofcom’s recent UK Market report.

Thus it is questionable whether an Ofcom mandate to implement an ACQ/CDB solution on
industry would be either proportionate or reasonable, bearing in mind the non-trivial costs to CPs
of doing so.

2.3 NGNs: As stated above the implementation of a direct routing porting process is dependent
upon deployment of NGN technology. This roll-out has slipped against all original timescales, and
continues to slip. This also applies to BT’s 21CN project. Not all TDM technology networks are
likely to be able to support direct routing, thus a period of parallel running will be required,
probably for some time until wide-scale implementation of NGNs has occurred. It is not clear that
this scenario has been properly considered, or costed, in Ofcom’s proposals and CBA work. Until
this has it would not be appropriate to set immovable deadlines for a CDB implementation. Best
endeavours would be a more pragmatic option with planned reviews particularly to check on NGN
availability. Gradual alignment would appear to be a sensible approach.

2.4         End-to-end process: As stated above there is significant work still required to design
and implement the other required overall aspects of a new porting process, that is all operations
from point of sale through to port activation and subsequent billing – as happens now. Until this is
resolved it is almost impossible for CPs to properly quantify the impact on them in terms of either
costs or operational resources, thus it is correspondingly difficult to, with any certainty, state when
an ACQ solution could be implemented. It will be critical that all key processes are consistent
across CPs to enable a uniform porting service and capability – this task should not be
underestimated.

2.5         Which numbers: The Ofcom proposal talks about ported numbers being populated on
the CDB (by December 2008).The NICC have argued that for the CDB to be really effective
requires that all numbers are populated not just ported ones. It is unclear at this stage what
impact this would have on implementation timescales, and would need full consideration before
overall timescales could be confirmed.

Question 3
If you believe Ofcom should not set a deadline for deploying the database to deliver
Direct Routing at this stage but should, instead, consult again during 2008, how could
Ofcom and industry ensure that appropriate momentum is maintained such that
Direct Routing is achieved at the earliest practicable date?

3.1 What is needed to deliver better porting processes are appropriate incentives – not penalties –
for industry. One significant incentive would be for full industry participation in the design and
specification of a revised process, rather than having a solution mandated by Ofcom. Although
NICC have been involved this has been specifically at a technical rather than commercial/product
level. What is needed is something that incorporates the experience – both operational and
commercial – of the NP Commercial Group. The proposed UKPorting organisation may well meet
the need provided that it incorporated the required operational experience.

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The problem, however, that may well arise is finding appropriate resource available from within
industry. This is an issue that has impacted NGNuk where convincing CPs to release key staff
has been problematical in the current climate. A solution may be for UKPorting to finance release
of staff either on a part or full time basis.

3.2 Gradual migration: A more pragmatic solution would be to manage a gradual migration from
the current porting process to a direct routing approach – in principle much as BT is doing with
regard to DLE closure, and other CP roll-out of NGNs. This would allow CPs to manage their own
resources and budgets in a controlled way driven by general market conditions, as opposed to
effectively being mandated by Ofcom to implement NGNs within a timeframe imposed by Ofcom
without regard to an individual CPs commercial situation.

It may not be Ofcom’s intent to mandate NGN roll-out, but that would be the de facto impact of
mandating an ACQ porting solution – which required NGN deployment. This is not Ofcom’s role or
an appropriate action for them.

Question 4
Do you agree that, where a common database is in place and supporting Direct
Routing of calls to ported numbers, changes could be implemented enabling (i)
recipient led and (ii) near-instant (not longer than two hours) porting of mobile
numbers at modest incremental cost proportionate to the benefits? Ofcom would
welcome detailed views on the additional costs involved, including whether any
additional costs would be incurred in ensuring that the database itself can support
near-instant (not longer than two hours) recipient led mobile porting.

4.1 The question of near-instant mobile porting should be answered in detail by the mobile service
providers. However, from a customer perspective VM (Fixed) would question whether there is a
real and quantified consumer need for such a porting capability, and whether it would necessarily
be in consumers best interests ?

4.2 Consumers will always say they want services provided faster (quicker) – and cheaper – but
often such responses are made without any real understanding of the implications on suppliers
and potential costs, which then impact on consumers. Progress – particularly technology –
provides increasingly sophisticated services, cheaper, and with enhanced capabilities. Customer
choice – through market competition – also tends to create a wide consumer selection of
suppliers. Thus porting has improved through user demands organically. It is not clear to us that
there is a market need to improve the porting of mobiles from the proposed two hours to near-
instant.

4.3 The latter would also leave no time to allow human error /process problems to be resolved
before the port takes place. Experience to date has shown that CPs do make errors – usually
unintentional – during the porting process and some time should be built into the process to
enable corrective measures to be actioned. Our concern would be that the level of customer
complaints could increase without the required safety net.

4.4 A “near-instant” porting timeframe also would leave no time for a consumer cooling-off period.

4.5 It would also leave no time for the doning CP to confirm with the customer that they actually
do want to port – a capability that has proven very useful in the fixed environment – eg to prevent
or recover from mis-selling activity. Thus there needs to be adequate time for effective order
validation within the process.

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4.6 The issue of porting also becomes more complex as increasingly consumers take up bundles
of products/services, so porting moves from just a single separate service to part (or all) of a
package. This has significant implications for the porting process overall, but in particular for
porting one element (mobile) in a very short timeframe. The more complex a bundle, then the
more potential for an error to be made either through (genuine) misunderstanding between the
consumer and their operator(s), through errors in the actual porting process, or through consumer
mistakes. All of which argue against a porting timeframe which does not allow sufficient time for
error resolution.

4.7 The process also needs to allow adequate time to ensure that DQ and emergency services
are properly lined up by the time the port is implemented – both of which are regulatory
obligations. To effect this in a “near instant” scenario may be problematical, and would inevitably
incur additional costs.

Question 5
Do you support Ofcom’s approach to achieve industry agreement on effective
governance of the new proposed number portability solution, as set out in
paragraphs 4.74 to 4.78?”

5.1 As referenced above VM consider that the whole issue of governance of a CDB end-to-end
process has not been considered in sufficient detail. This work will be critical to the success, or
not, of any CDB solution.

5.2 As suggested above we agree that it is critical that industry should play a significant part in
this, but it would be unreasonable for Ofcom not to be involved. Ofcom are proposing to mandate
an ACQ/CDB solution on industry, with as yet insufficient justification or clarity on overall cost and
resource impact. To then effectively action industry to produce all the product and technical
specification, procurement, and operating arrangements to a timetable set by Ofcom would be
unreasonable and impractical.

5.3 This needs to be managed via a new body, as NGNuk is not the appropriate structure.
UKPorting may the solution depending upon its composition and management structure, which
needs to incorporate the experience, learning and operational knowledge developed within the
UK NP Commercial Group – see our comments above.

The issue of funding this work is also a key one – again see our comments above.

5.4 Governance arrangements around the world differ considerably, so there does not appear to
be a consistent proven model to copy – the NRA, local industry, appointed consultants are
variously involved. All options have different cost and resource implications in terms of design,
development, implementation and ongoing management.

It is also the case that in some countries porting as a process has only recently been introduced,
so it is easier for these to take advantage of the latest technologies in their solution, rather than
having to take into account legacy technologies as in the UK.

Virgin Media
September 2007

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