Campaign for Unmetered Telecommunications
 
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CUT, OFTEL and a Select Committee ... again (10 August 1999)

On 9 August 1999 the Trade and Industry Select Committee of the House of Commons published a report entitled simply Electronic Commerce. Although not expected in this form it is, in effect, an extremely welcome supplement to the first Select Committee report entitled Building Confidence in Electronic Commerce, published on 19 May 1999, to which we had made a submission.

The policy recommendations of the second Select Committee report outline what the Government and Regulators should do to encourage widespread and effective use of modern connected technologies in this country; they also cover the social implications of these technologies.

We are immensely pleased to note that both our submission and that of Tom Long, which we had encouraged him to make, form the backbone to the policy recommendations. Particularly encouraging is the repeated use of the term 'unmetered' in preference to 'free', which was prevalent in the previous report.

Although there is nothing forcing OFTEL to order the implementation of unmetered telephony as of now (Select Committees can only recommend and it is for the Goverment to act, or not act, on those recommendations), the report is underpinned throughout by similar sentiments to the statement that the more widespread availability to residential customers of unmetered local telephone calls would give electronic commerce in the UK a substantial boost.

The report is scathing of the Government's electronic agenda which is described as characterised by hyperbole, over-optimism ... and repeated failures to learn from past mistakes. Remarks about the Regulator's track record are scarcely more complimentary: OFTEL has been unduly cautious in emphasising the possible disadvantages of unmetered local calls, at the expense of the potential benefits.

The key chapter of the 55-page report, entitled Social Issues, quotes at considerable length from the CUT and Tom Long submissions and uses our evidence to undermine what OFTEL said in its two Memoranda to the Select Committee. This is particularly gratifying as it was OFTEL's inadequate and misleading first Memorandum to the Select Committee that sparked off our submission.

The recommendations cover much of what we campaign for:

The Government Statistical Service [should] consider how best to develop new statistical measures relating to electronic commerce and to adopt its existing measures to the phenomenon (paragraph 13)

Numerical indicators, for instance of the number of firms on-line, are not necessarily the best or only measures of the quality of the UK's environment for electronic trading (paragraph 18)

In order to be effective, the e-Envoy must not be seen within Government as a DTI official defending the Department's line on issues which cut across departmental boundaries (paragraphs 32, 33, 34 and 36)

Ministers must not seek to burden the e-Envoy with a host of unduly ambitious and unrealistic objectives and responsibilities. The role of e-Envoy will be discredited if it is seen to combine responsibility without power (paragraph 35)

OFTEL's electronic commerce team must quickly establish a cooperative relationship with the e-Envoy, when appointed, in order to ensure that their respective remits are appropriately coordinated (paragraph 28)

OFTEL must be proactive in ensuring that competitive forces exert their influence throughout the UK's telecommunications infrastructure so that residential consumers and small and medium sized enterprises can benefit from a choice of high-bandwidth technologies from different operators (paragraph 46)

The Government must ensure that the opportunity to unlock the potential of the rural economy is exploited, not wasted due to deficiencies in the nation's telecommunications infrastructure, by ensuring that there exists effective competition in the supply of high-bandwidth services to all users, not just those in urban or suburban areas (paragraph 47)

The more widespread availability to residential customers of unmetered local telephone calls would give electronic commerce in the UK a substantial boost... OFTEL has been unduly cautious in emphasising the possible disadvantages of unmetered local calls, at the expense of the potential benefits (paragraph 59)

Consumers need full and clear information about the tariffs charged by different telephone operators in order for them to take full advantage of the opportunities offered by competition in the telecommunications market. Urgent progress in this area is now required (paragraph 53)

The Director General of Telecommunications [should] be given a specific duty to facilitate electronic commerce, at the earliest opportunity. We would expect the Director General, in response, to publish a statement of how he intends to comply with his new duty (paragraph 31)

Ensuring that UK firms have a choice of competitively-priced high-quality high-bandwidth services must be an urgent priority for OFTEL (paragraph 64)

The Government [should] begin a national debate about how the universal service concept can be applied to electronic commerce (paragraph 80)

Too many of the initiatives seem ill-thought out and lacking in detail - promising on paper, but, so far, short of substance. There is a worrying lack of attention to the coordination of these projects with existing initiatives, the proposed small business service, new regional organisations and the devolved assemblies (paragraph 86)

So what we campaign for is now a major element of backbench thinking on e-commerce. We await the OFTEL and Governmental responses, and will comment after they are released.

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