Ofcom to let new ISPs help customers switch

10 Sep 2010
broadband cable

Half of broadband users think switching to a new provider is too much hassle

Ofcom is considering overhauling the process by which customers switch broadband providers, putting the onus on the new ISP to handle the move.

At the moment, when a customer wants to leave one broadband provider in favour of another, the losing side must supply a Migration Authorisation Code (MAC) to be handed to the new supplier.

Under such a system, 45% of broadband users think switching to a new provider is too much hassle, according to Ofcom. That's set to worsen as more customers move to bundled packages, the watchdog warned.

To make things easier, Ofcom is considering switching to a Gaining Provider Led (GPL) process, to put the onus on the new ISP - which has greater motivation to take care of customers. "The gaining provider has an incentive to ensure that the switching process is as smooth and easy as possible," said Ofcom.

The gaining provider has an incentive to ensure that the switching process is as smooth and easy as possible

"GPL processes are also more likely to deliver lower prices, greater choice and innovation for consumers as they force providers to compete vigorously for rivals' customers," Ofcom added.

"In Losing Provider Led (LPL) processes this incentive for providers to enter and compete for rivals' customers is reduced because of the ability of the losing provider to identify (via the code request) and retain customers willing to switch through 'save offers'."

Ofcom admitted the GPL system raises concerns about "slamming" - where a user is switched to a new ISP without consent - and said protection methods would need to be developed.

The watchdog said it would release a consultation document by May or June, and final plan by the end of 2011 for broadband and fixed phone lines, which it said had the "worst problems", before looking at the mobile space.

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