Openreach was setup a decade ago after Ofcom’s original review in 2005, which among other things forced BT to open part of their network to competition (“functional separation“) and introduced Local Loop Unbundling (i.e. allowing rival ISPs to install their own kit in BT’s telephone exchanges, giving them more control over ADSL broadband and phone).

Since then the market has evolved and the new “fibre broadband” (FTTC) services don’t offer the same kind of control or price flexibility as the older LLU ADSL solutions. Meanwhile many of BT’s rivals feel as if the operator still has too much control over Openreach and aren’t investing enough in their infrastructure, which they claim has damaged competition and performance.

By comparison BT say they’ve invested billions into the national infrastructure, are delivering a good level of service (i.e. meeting Ofcom’s targets) and claim that their rivals seek a free ride off the back of all their hard work. BT has also warned that splitting Openreach could damage their plans to invest in future “ultrafast” G.fast broadband upgrades and the 10Mbps USO (details).

Furthermore there were also fears about the risk from a protracted legal battle, concerns over how BT’s huge pension deficit and group debt would be split and uncertainty over who would provide Openreach’s future investment. On the other hand BT’s rivals believe that an independent Openreach could have fostered investment into superior FTTH/P technology and made the market more open and fair for everybody.

Ofcom’s job in all this was to navigate the maze of conflicting claims and decide what the market should look like for the next 10 years. The result is a compromise rather than total separation. Not that the outcome is good news for BT and indeed some of the measures look like painful medicine.

Ofcom’s Decision

In the end Ofcom’s review did find “evidence” to show that Openreach “still has an incentive to make decisions in the interests of BT, rather than BT’s competitors, which can lead to competition problems“. It also said that “other telecoms companies have not been consulted sufficiently on investment plans that affect them“, which they believe is something that needs to change.

Summary of Key Changes (inc. non BT areas)

* A new strategy has been proposed to promote the large-scale roll-out of new ultrafast broadband networks, based on cable and fibre optic lines, as an “alternative to the partly copper-based technologies” (e.g. FTTC). Openreach will be required to open up its telegraph poles and cable ducts, which must also be made “much easier for competitors to access.”

* Openreach must provide comprehensive data on the nature and location of its ducts and poles. Using these, rival ISPs will be able to build their own fibre networks, connected directly to homes and offices.

* Ofcom claims that Openreach’s governance lacks independence from BT Group and as a result they will overhaul it, which should allow Openreach to take its own decisions on budget, investment and strategy. The new management would be required to “serve all wholesale customers equally, and consult them on its investment plans“. There will also be greater transparency over how costs and assets are allocated between Openreach and the rest of BT.

* Ofcom will introduce even tougher minimum service requirements to push Openreach into repairing faults and install new lines more quickly.

* The regulator will also introduce new performance tables on quality of service, identifying the best and worst operators on a range of performance measures “so that customers can shop around with confidence“.

* Consumer broadband, phone and mobile operators will also have to introduce “automatic compensation” when things go wrong, such as due to a “loss or reduction of service” (this is a feature that used to only be offered alongside business products).

* Future auctions of radio spectrum, specifically those that will go to mobile network operators, will include new obligations to help improve rural mobile coverage.

* Ofcom will also work to make switching mobile operators easier and will soon publish a new consultation.

* Ofcom also said they would work to help the Government design a 10Mbps Universal Service Obligation for broadband, but then we already knew they would.

The regulator claims that the new model of Openreach governance (detailed proposals on this are expected to surface later in the year) might require the company to “become a ring-fenced, ‘wholly-owned subsidiary’ of BT Group, with its own purpose and board members“.

Ofcom also said that they would reserve the right to “spin-off” Openreach “as an entirely separate legal entity, with its own shareholders,” albeit only if BT doesn’t play ball with their proposals. But first the regulator will need to address this proposal with the European Commission (EC) and no doubt BT will object.

Sharon White, Ofcom Chief Executive, said:

“People across the UK today need affordable, reliable phone and broadband services. Coverage and quality are improving, but not fast enough to meet the growing expectations of consumers and businesses.

So today we’ve announced fundamental reform of the telecoms market – more competition, a new structure for Openreach, tougher performance targets, and a range of measures to boost service quality.

Together, this means a better deal for telecoms users, which will improve the services and networks that underpin how we live and work.”

The result is unlikely to please everybody and indeed we could well be back here again in the future because the issue of BT’s status in the market is a bit like the playground pinata; every now and then a group gets together to take a bite out of the seemingly unmovable object, such is the reality of being an incumbent Telco in today’s market.

Meanwhile there’s the question of what impact Ofcom’s changes will have upon the market, assuming all of their proposals survive the inevitable bickering match between warring operators. History tends to show that big changes need a year or so to solidify before ISPs start to take advantage of them, but some (e.g. greater access to Openreach’s network) may simply be too attractive to go unused for that long; assuming they can get the prices right (that’s a big question).

At this point we’d say that BT can already grant access to their cable ducts and poles through thePhysical Infrastructure Access (PIA) solution, but this can’t be used for connecting businesses and suffers from other limitations that have limited its uptake. Hence Ofcom are proposing something much more significant.

Similarly there’s the other question of how all this will affect the price that consumers pay, particularly in regards to the impact of Ofcom’s new quality standards and a move towards automatic compensation. Both could add extra costs on to both ISPs and Openreach, which may end up being passed on to consumers (it will be difficult to do this on the cheapest ISPs without raising prices). No doubt ISPs will also want Openreach to help cover the cost of compensating for any related service outage, which in the past has often been a big bone of contention.

At this point we’ve only had a chance to glance at the report and will come back to highlight other details as the day continues. In the meantime the big question mark is over how BT will react and indeed whether or not they might find the adjustment so tough as to prefer a spin-off, but we view the latter outcome as being very unlikely. We expect their response to come at around 9am.

Finally, it’s worth saying that the changes will all be introduced gradually through Ofcom’s periodic reviews (e.g. the next Wholesale Local Access and Wholesale Broadband Market Reviews) and not in one big bang. In other words it could take a couple of years before all of today’s proposed changes are fleshed out and become real for the market.

Ofcom’s Strategic Review (Initial Conclusions)
http://stakeholders.ofcom.org.uk/telecoms/policy/digital-comms-review/dcr-feb-16/

UPDATE 8:13am

Reading through the document we note that Ofcom are not yet proposing to make any firm changes to the pricing of Openreach’s FTTC (VDSL) “fibre broadband” service, which will disappoint TalkTalk andSky Broadband. Ofcom reasons that this could happen in the future, but it also wants to encourage rival ISPs to build their own alternatives.

“Competing providers should be incentivised to build their own networks where this is viable. It must not be too ‘easy’ for competitors to rely on ‘buying’ access to another’s network when there is the potential to invest in their own,” said Ofcom’s report.

However Ofcom’s notes that their position may change, particularly when they come to begin their next wholesale local access review that will cover the 2017-2020 period. “By 2020 superfast broadband services are predicted to account for the vast majority of broadband connections. Pricing flexibility will have been applied to BT’s FTTC investment for 10 years. For this market review, there will be a variety of arguments in favour of reduced pricing flexibility, including potentially reaching the original date for expected payback. In this context, we may be coming toward the end of the fair bet, which could result in a transition to some form of charge controls,” concluded Ofcom.

The post Ofcom Confirm NO Openreach Split from BT, But Big Change is Coming appeared first on United Networks.

Reports at the weekend suggested that Ofcom would not move to separate BT (here) from control of their national UK phone and broadband network (Openreach), although they might keep that option on the table. Never the less Patterson cannot afford to trust in leaks to the media, not least because BT will officially learn of its fate at the same time as everybody else.. tomorrow.

Gavin Patterson said:

“There’s a significant investment that we are ready to make now in the next generation of technology, more Fibre-to-the-Premise [FTTP], G.fast (and) Fibre-to-the-Cabinet [FTTC] … That’s a big decision, we are ready to make it if we get some regulatory certainty coming out of the Ofcom review.

Openreach is the only national player and it is very heavily regulated. We believe having Openreach as a unit within the BT group is good for investment and for research and development, and insures you get a national service at competitive prices. If it’s ever separated, would you see the same investments being made? I very much doubt you would.”

According to a related report on the FT, that “significant” investment would see BT spend £1 billion+on improving UK broadband connectivity. But the commitment lacks key information, such as whether or not this actually reflects an existing pledge or even if it has separated out Capex (capital expenditure) from Opex (operating expenditure).

Readers may recall that BT made a big commitment last September towards improving national broadband connectivity (here) and the bulk of that is focused on their G.fast deployment. BT intends to begin the commercial roll-out of G.fast in 2017 (here and here) and they’ve pledged to make the new service available to 10 million premises by 2020, with “most of the UK” likely to be done by 2025. Initially the service will only offer speeds of up to 300Mbps, before later increasing to 500Mbps.

At this point readers may recall that BT’s original £2.5bn commercial commitment to roll-out superfast broadband (FTTC/P) also intended to deploy significantly more ultrafast fibre optic 330Mbps FTTPbroadband (around 2.5 million premises passed), but the operator ended up dramatically scaling that back in order to focus on cheaper, but slower, 40-80Mbps FTTC. A fair bit of that £2.5bn didn’t get spent, which they’d say is good value for money.

However BT already spends around £300-400m per annum on “fibre” (so we were told last year) and broadly expect that to continue for the next 5 years until 2020, with the majority of future investment likely to support the G.fast roll-out. But BT also told us that G.fast could be done within the original £2.5bn commercial commitment and that begs the question, is the new promise of “significant” investment largely just a re-announcement?

We did shoot off a quick message in the hope of some clarity, although a BT spokesperson told ISPreview.co.uk, “Ofcom will release their provisional findings on Thursday morning and we will respond then. We made it clear in September that we are keen to invest large additional sums in the UK ‘s infrastructure and that has not changed. Regulatory certainty is required however as Gavin made clear yesterday.”

Lest we not forget BT’s other commitment, which originally (2010/11) promised to match the £830mstate aid allocation through the Broadband Delivery UK programme (this is separate to the £2.5bn commercial commitment). At this point it’s becoming hard to distinguish new commitments from old. In any case we might get a clearer answer after tomorrow.

Meanwhile Vodafone’s CEO, Vittorio Colao, also used the MWC event to take a last ditch shot at BT: “A model which was supposed to be neutral and separated has actually been creating extra profits for the company that owns it. It’s a model that allows equal access but a price higher than most European countries. I hope [Ofcom’s CEO] is going to say either that she really supports considering the split of Openreach or at least that she will put much tighter obligations on Openreach, both in terms of performance and pricing.”

We suspect that Vodafone will get at least part of what they want.

The post BT Pledge Over GBP1bn to Boost UK Broadband, But is it New Money appeared first on United Networks.

Instead Ofcom is expected to impose greater separation of Openreach from BT, which could involve giving rival ISPs more access to Openreach’s national network of cables and telephone exchanges (a highly likely outcome). Potentially Ofcom may also require BT’s network access division to have its own separate board, which the operator won’t be very happy about.

However it’s understood that the regulator will opt to keep the option of full separation on the table, which could be used as a bargaining chip should BT move to aggressively oppose their new measures. A BT source told The Telegraph that this may yet result in separation: “It could get to the point of separation by the back door” (i.e. if the price of Ofcom’s new regulation feels too high to stomach).

Naturally all of this is to be accompanied by a variety of other changes to market regulation, which will go well beyond the question of Openreach’s separation. We’ll find out more on Thursday.

The post BT Set to Avoid Openreach Split as Ofcom Opts for the Middle Ground appeared first on United Networks.

At present Ofcom’s on-going Strategic Review of Digital Communications is said to be “seriously” considering the option of breaking up BT, which if appropriate would require the regulator to refer the operator to the Competition and Markets Authority(CMA).

Politicians seem to be divided on the topic, with many supporting such a split (here) and others, such as Ed Vaizey (Digital Economy Minister), suggesting that it has “lots of potential to backfire” and existing “regulations have proved very effective” (here).

Meanwhile BT contends that it has continued to meet Ofcom’s existing regulatory targets and that any attempt to split their business might tie the process up in legal battles. Questions also remain over how BT’s debt / pension pile might be apportioned in the event of a split, as well as the impact on consumer prices from all of the related changes (better services cost more money) and what kind of market model might be adopted in its place.

BT has also warned that their plans to roll-out ultrafast (G.fast) broadband could suffer, but that may be a moot point if FTTH/P ends up becoming the favoured course. Equally there’s a risk that separating Openreach might harm investment in alternative network operators, since Openreach would perhaps be seen as the bigger target for investment. It also remains unclear whether smaller ISPs on Openreach’s network would be winners or losers in such a market.

In to this seemingly endless debate steps the CPS, which believes that separation of BT may be the best long-term fix for the United Kingdom’s telecoms market.

Daniel Mahoney, CPS Economic Bulletin, said:

“The UK’s broadband infrastructure is falling behind international competitors. BT has abandoned attempts to rollout ultra-fast fibre to premises broadband infrastructure. Instead, BT’s focus is on fibre to the network and sweating copper assets, which will provide comparatively slower speeds.

Structural separation of BT Openreach must therefore be considered for the UK’s broadband infrastructure. Regardless of whether there is merit in complaints about BT Openreach’s service provision, the current broadband infrastructure market appears anti-competitive.

The current broadband infrastructure system leads to a conflict of interest in two key ways. BT runs the UK’s broadband infrastructure and service providers are forced to use this infrastructure. Furthermore, BT uses its own infrastructure to provide internet services to customers, which is a major disadvantage to its retail broadband competitors.

Structural separation, however, could provide a market with a level playing field between all players, where the infrastructure that service providers rely on would not be owned by one company. This would be good for competition and good for consumers. There is every indication to suggest that a structurally separated BT Openreach – with various investors – might be more likely to invest in higher speed broadband provision. International precedents from Singapore and New Zealand provide favourable evidence for the structurally separated model.

Ofcom should refer the issue of structural separation of BT Openreach to the Competition and Markets Authority later this month. The Competition and Markets Authority can then investigate the matter and suggest the best ways of increasing competitive pressures in this market.

A delayed decision on this issue will be bad for broadband consumers and bad for the UK economy’s productivity. Previous delayed decisions on improving the UK’s infrastructure – such as that on Heathrow expansion – have been detrimental to the UK economy. Ofcom must not follow in these footsteps.”

A short summary of the bulletin can be found online (here), which echoes many of the arguments that we’ve seen before and suggests that such a move would foster the deployment of ultrafast FTTH/P in favour of hybrid-fibre solutions like G.fast. However it’s worth noting that this would not solve the connectivity problems for rural areas since none of the major players seems to anticipate 100% FTTH/P coverage or even close to it.

Ofcom aims to publish their findings by the end of this month, although it could still be delayed into March or later. At this point the weight of opinion seems to be moving in favour of those calling for BT to be split, but only the regulator can actually make the final decision and history shows that they tend to prefer a less aggressive approach. We shall see soon enough.

UPDATE 4:49pm

The official BT response is as follows.

A BT Spokesperson said:

“Unlike respected independent studies by Ofcom, the EU and others, this blog is under-researched and paints a false picture of UK broadband.

It compares the UK to other countries based only on average speeds, whereas other important measures – such as availability of services, prices and take-up – place the UK well against important international peers. There is also no acknowledgement that ultrafast speeds can be achieved at a fraction of the cost and in a fraction of the time using G.Fast technology pioneered by BT.

Independent analysts disagree that structural separation has been a great success elsewhere. They find that the few countries to try it have either higher broadband prices, slower roll-outs, much larger tax-payer subsidies – or a combination of all three.

There is simply no evidence that broadband investment would be higher or competition fiercer if Openreach became a smaller, weaker, standalone company. How could it, when the UK already has more than 500 firms competing in this market and Ofcom sets 96% of Openreach prices to level the playing field for them all?

As the blog highlights, the UK is in a stronger position than its European peers, and BT has outlined ambitious plans to invest in ultrafast broadband over the next decade.”

The post Centre for Policy Studies Calls for Ofcom to Initiate BT Breakup appeared first on United Networks.

The reaction, which according to The Telegraph also delivers a point-by-point rebuttal of the recent “Broadbad Report” that was signed by 121 cross-party MPs, comes at a time when Ofcom are said to be “seriously” considering (here) the option of splitting BT from control of their national broadband and phone network (Openreach).

BT’s CEO, Gavin Patterson, said:

“Separation would be costly and divert time and funding away from investment in UK infrastructure, at a time when the UK is at a crucial stage of its development as a world-leading digital nation.

Surely those impatient to see yet more homes and businesses get better broadband would rather that the money, time and effort went into the next stages of Superfast broadband, and then into Ultrafast?”

In fairness the “Broadbad” report had plenty of big flaws, such as using out of date information for broadband coverage and failing to do a deeper analysis of its own claims, which is disappointing because it arguably missed a golden opportunity to highlight some very real failings and therefore risked damaging the credibility of its own message.

Never the less the report did succeed in chiming in with all those politicians and people who, in a world where broadband is increasingly being seen as a vital utility service, simply expect an awful lot better from BT and its national service / network delivery business.

Patterson’s letter also pointed to praise of its network from around the world and made specific mention of Australia, which recently highlighted Openreach as an “example to follow“. Mind you this might not have been the best country to use given that Australia’s NBN broadband network project has been historically beset by political division and its many changing choices of technology, which have caused delays and other problems. Lest we not forget that Australia itself is a continent unto itself and a generally very different place from the UK.

Apparently some MPs have been “really aggrieved” by the letter and Conservative MP Grant Shapps, who pieced together the “Broadbad” report, also chimed in to suggest that the operator had gone into “PR overdrive” and should perhaps instead spend such money on improving its service delivery.

On the one hand we can hardly blame BT for moving to defend itself against sharp criticism of its service. On the other hand biting the hands that might one day turn around and cut you into little tiny pieces could risk drawing more support towards calls for the operator’s separation.

At this stage BT perhaps reasons that Ofcom has already made up its mind on the outcome and we’ll probably find out what that is within the next few weeks. Finally, Patterson added that BT was “far from the old-fashioned, unchallenged monopoly some critics seem to suggest“.

The post BT Fighting Against Separation from OpenReach appeared first on United Networks.

At present BT has only just begun their initial planning and survey work for the 10 year deal, with the new network expected to go live sometime during theSpring 2016. The deployment, which will utilise the existing CCTV network for capacity, won’t cost the council anything and may also be used to help improve local 4G mobile phone coverage.

Rory Palmer, Deputy City Mayor, said:

“We already have free wi-fi in our libraries and we know how popular wi-fi hotspots in city centre coffee shops and other venues are. We’d like to be able to extend this offer so that people can get online even more easily.

Free wi-fi will also support our plans to promote economic growth in the city as well as being an essential infrastructure for a modern connected city.”

BT has also made similar deployments in Cardiff, Gloucester, Glasgow, Nottingham and Newcastle etc.

The post Leicester UK City Council to Deploy FREE WiFi Internet Connectivity appeared first on United Networks.

According to a status update from AAISP, “BT have a major problem at the moment and lines which log off are unable to log back in again. Our TalkTalkservices are unaffected, and lines which stay online are unaffected. This looks to be a country wide problem affecting many ISPs.” A large number of UK ISPs that use BT’s services (e.g. BTWholesale) appear to be affected by the issue, which began at around 2 – 3pm.

Sorry if your are experiencing network problems. Engineers are on site now. We will keep you updated.

— BT (@BTCare) February 2, 2016

The hashtag #BTDown on Twitter is starting to trend and the advice right now is that if you’re connected then don’t reboot your router as you may struggle to reconnect.

UPDATE 3:52pm

Apparently the problems are also extending to the systems that ISPs use to interface with BT via Openreach / Wholesale, such as diagnostic services. We also note that BT.com is working (partly), but their Service Status page for consumer broadband is not. It’s a very unusual problem.

UPDATE 4:03pm

Anybody expecting an Openreach engineer to visit today may see delays (more so than usual) because even BT’s engineers are being affected by some of the system outages.

UPDATE 4:06pm

Services that make use of Vodafone’s unbundled broadband lines are also unaffected by this problem, much like Sky and TT.

UPDATE 4:16pm

Some consumers who managed to reach BT’s customer support have been told that the ETA for a fix is around 4 hours, which suggests that they know what’s wrong. Otherwise we have so far had no reply from BT itself and our main source of information has been third-party ISPs, which are much more helpful.

UPDATE 4:29pm

Openreach are informing ISPs, such as Aquiss, that the target time for a fix is now 7pm.

UPDATE 4:36pm

Some ISPs are reporting that their API/XML Interfaces may be improving because the connectivity to Openreach/Wholesale is slowly starting to return. The official line from Openreach to ISPs is currently as follows: “We are aware of an issue impacting connectivity to Broadband services and are currently investigating with technical support teams. At the moment, we are unable to inform you of your specific affected circuits and services. Once root cause is established we will issue this detail promptly.”

Unconfirmed rumours are also bouncing around the ISP sphere that a DDoS attack may have been to blame, with everything ending up being routed to the Collindale PoP as all others were suffering problems. We can’t speak to the DDoS attack, but some of BT’s PoPs certainly hit troubled times.

UPDATE 4:49pm

We’re seeing some consumers report that their broadband is now reconnecting, but issues remain for other parts of the UK. Likewise BT’s websites appear to have come back to life after 2-3 hours of turmoil.

UPDATE 4:58pm

The official line from BT is in.

A BT Spokesperson told ISPreview.co.uk:

“Large numbers of customers have been experiencing temporary issues with their broadband services this afternoon. Customers can still receive and make calls as normal.

We’ve been working hard to fix the issue and are glad to report that nearly every customer affected is now reconnected, approximately two hours after the problem started.

We apologise to any affected customers for the inconvenience.

There is no evidence at this stage to suggest that we were subject to a malicious attack.”

The post BT’s National UK Network Suffers Serious Broadband Outage appeared first on United Networks.

At present the Government’s Broadband Delivery UKprogramme is already working to push superfast broadband (24Mbps+) capable connectivity out to 95% of the United Kingdom by 2017/18 and BT expects that 96% may actually be delivered. But that still leaves 3-4% of premises left to wait for better connectivity, mostly in remote rural areas and a few urban pockets.

The Government have already conducted a number of Market Test Pilots (MTP) in order to trial several alternative network approaches (e.g. fixed wireless access, fibre optic based and satellite etc.) and their £60m USC (2Mbps for all) subsidy for Satellite connections has also been expanded for use by at least one wireless provider (here).

Never the less a coherent plan for closing the gap is still somewhat absent, but now might be the best time to debate this problem given. The Government are already consulting on a new approach to EU State Aid approval for future broadband contracts (here) and will shortly consult on proposals for a new 10Mbps Universal Service Obligation (USO).

Matt Warman, MP for Boston and Skegness, said:

“I am pleased that the Government is listening to concerns from MP and other groups about the variations in broadband coverage in both urban and rural areas, and is hosting the ‘not-spot’ summit to look at ways to improve coverage for families and businesses across the country.

I have no doubt that the range of internet providers and interested groups will provide for an interesting and productive discussion on what we can all do to ensure better coverage going forward.”

Warman originally called for the debate during a related session in the House of Commons last October 2015 (here), although it wouldn’t be the first time that such a debate has been held and we expect many of the usual issues to raise their heads again. Similarly representatives from BDUK, EEand BT will also be speaking at the event.

The debate also claims to be open to “interest groups,” although some sources indicate that this won’t include campaign groups, which is a bit disappointing.

The post UK Government to Debate Broadband Not-spots on Wednesday appeared first on United Networks.

The bill marks the third attempt by a Government to expand the United Kingdom’s existing telecoms snooping laws by forcing broadband ISPs into logging a bigger slice of everybody’s online activity and then keeping that log for up to 12 months, irrespective of whether or not you’ve committed a crime.

On top of that the IPB would also make this data (ICR – Internet Connection Records) more easily accessible for law enforcement agencies through a complex “Request Filter” (not unlike a central database) and Police would not require a full warrant in order to gain access. But a warrant would still be needed for more targeted and detailed interception of an individual’s communications.

More recently ISPs have also warned that the predicted costs of implementing the bill (upwards of£175m) are far too low (here) and that some of the measures could impose an effective ban on encrypted end-to-end communication services (not even the service provider can view these). A recent meeting between smaller ISPs and the Home Office also suggested that the Government didn’t yet have a full grasp of the technical challenges involved (here).

Into this battle steps the Science and Technology Committee, which has today published the outcome from their inquiry into the IPB and echoed the above concerns.

Nicola Blackwood MP, Chair of the Committee, said:

“It is vital we get the balance right between protecting our security and the health of our economy. We need our security services to be able to do their job and prevent terrorism, but as legislators we need to be careful not to inadvertently disadvantage the UK’s rapidly growing Tech sector.

The current lack of clarity within the draft Investigatory Powers Bill is causing concern amongst businesses. There are widespread doubts over the definition, not to mention the definability, of a number of the terms used in the draft Bill. The Government must urgently review the legislation so that the obligations on the industry are clear and proportionate.

There remain questions about the feasibility of collecting and storing Internet Connection Records (ICRs), including concerns about ensuring security for the records from hackers. The Bill was intended to provide clarity to the industry, but the current draft contains very broad and ambiguous definitions of ICRs, which are confusing communications providers. This must be put right for the Bill to achieve its stated security goals.”

Interestingly, on the subject of encryption, Blackwood states: “The Government needs to do more to allay unfounded concerns that encryption will no longer be possible,” particularly in regards to the impact upon end-to-end encryption. “The Government should … state clearly in the Codes of Practice that it will not be seeking unencrypted content in such cases,” says the report.

Blackwood also loosely notes the risk to international competition if UK tech companies are effectively required to limit the security of their hardware and software products in order to meet the Government’s new rules, particularly in regards to weakening encryption. Rival products from other countries that do not impose such measures would naturally look more competitive.

The Committee also ruled that the Government should pick up the tab for all of the additional data storing costs involved in the IPB’s implementation, especially for smaller ISPs, and clarify some of the bill’s more confusing terms (e.g. what exactly does an ICR constitute?). It also demands further examination of the costs in order to arrive at a more accurate figure.

In keeping with all that the report recommends that the bill adopt Detailed Codes of Practice, which should for example “clearly set out the requirements for protecting ICR data that will have to be retained and managed by [ISPs], along with the security standards to keep them safe“.

Finally the report calls on the Government to review the composition of its Technical Advisory Board to “ensure that it will have members from industry who will be able to give proper consideration, not just to the technical aspects of appeals submitted to it from CSPs concerned about ICR or other interception or ‘interference’ notices, but also any concerns raised about costs“.

Nicholas Lansman, ISPA Secretary General, said:

“We are pleased parliament recognises that the Bill, as drafted, risks undermining the competitiveness of the UK tech sector. We now expect the Home Office to take on board these recommendations, along with those of the upcoming Joint Committee report, to produce a clearer Bill that is clear, technically feasible, proportionate and maintains trust in online services.”

In Blackwood’s words, “There are good grounds to believe that without further refinement, there could be many unintended consequences for commerce arising from the current lack of clarity of the terms and scope of the legislation.”

UPDATE 10:31am

Fibre optic ISP Gigaclear has added some thoughts.

Matthew Hare, CEO of Gigaclear, told ISPreview.co.uk:

“For the UK to remain the best place to do business online, investment and focus needs to be on building a better broadband infrastructure, not on data storage measures that are unlikely to deliver the security we all want.

Gigaclear will connect 55,000 properties to its pure fibre network this year, but if the data storage measures outlined in the IPB have to be enacted, we will have to divert resources away from this important work. The focus for our engineers will be on monitoring data, rather than the expansion of our network, which is so crucial to the UK.

I am also concerned that capturing and retaining Internet Connection Records (ICRs) will actually create a security risk, not solve one. The data could be vulnerable to criminals. It will also undermine trust in the use of the Internet in the UK. Businesses will be reluctant to base themselves here in Britain, which will have a hugely damaging knock on effect to the wider economy.

Finally, such data storage demands will only become more burdensome in the future. Our Gigaclear customers, who have ultrafast broadband with speeds of up to 1Gbps, use the Internet up to 15 times more than the UK average. This shows a direct correlation between broadband speeds and Internet use. As the UK infrastructure is updated during the BDUK rollout and more people have access to faster speeds, so data usage will rocket and the task will become even more onerous for companies like ours. This has to be taken into account.”

The post UPD Science and Tech Committee Warns of UK Internet Snooping Bill Costs appeared first on United Networks.

The new guidelines follow last year’s agreement to introduce a new Net Neutrality law, although this time around the language appears to be somewhat stricter. Never the less there are still some caveats, such as to allow Internet security services (anti-spam/virus filtering etc.), support websites blocked via court orders and for general traffic management measures (when needed to tackle network congestion).

The Broadband Stakeholders Group, which manages the related Open Internet and Traffic Management Codes of Practice for UK providers, recently completed a review of its code and opted not to make any major changes. In fairness their voluntary code was already fairly similar to what Europe has proposed to implement.

One potential conflict area could be with the UK Government’s drive to force network-level filtering (Parental Control) services on to Internet providers. So far most ISPs get around any Net Neutrality concerns on this front by offering adult content blocking as an optional service during sign-up, but not all of them take the same approach.

Sky Broadband recently announced its intention to adopt a default-on approach to Internet filtering that would conflict with the new EU stance and the Government are even considering a law change in order to support this (here). Otherwise here’s a summary of the Council’s recommendation for a new net neutrality framework.

EU Net Neutrality Guidelines (Framework Recommendation)

1. General principles

1.1. Internet users have the right to freedom of expression, including the right to receive and impart information, by using services, applications and devices of their choice, in full compliance with Article 10 of the Convention. These rights must be enjoyed without discrimination on any ground such as gender, sexual orientation, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.

1.2. Internet users’ right to receive and impart information should not be restricted by means of blocking, slowing down, degrading or discriminating Internet traffic associated with particular content, services, applications or devices, or traffic associated with services provided on the basis of exclusive arrangements or tariffs.

1.3. Internet users should be entitled to an Internet connection with the characteristics defined in the contractual agreements that they have concluded with Internet access service providers on the basis of specific and adequate information that is provided to users with regard to all aspects which might affect their access to the Internet and their right to receive and impart information.

2. Equal treatment of Internet traffic

2.1. Internet traffic should be treated equally, without discrimination, restriction or interference irrespective of the sender, receiver, content, application, service or device. This is understood as the network neutrality principle for the purpose of this recommendation. The network neutrality principle applies to all Internet access services irrespective of the infrastructure or the network used for the Internet connection and regardless of the underlying technology used to transmit signals.

2.2. This does not preclude Internet traffic management measures which are necessary and proportionate to:

– give effect to a court order or an order of a regulatory authority;

– preserve the integrity and security of the network, services provided via the network and end-users’ terminal equipment;

– prevent network congestion and optimise traffic management when congestion occurs.

2.3. Internet traffic management measures should be non-discriminatory, transparent and maintained no longer than strictly necessary. Traffic management policies should be subject to periodic review by competent authorities within each member State.

3. Pluralism and diversity of information

3.1. Internet service providers should not discriminate against traffic from other providers of content, applications and services which compete with their own products. This requires that traffic management decisions be strictly dissociated from content-related decision-making processes of the operator in the spirit of the 2007 Committee of Ministers’ Declaration on protecting the role of the media in democracy in the context of media concentration.

3.2. As an exemption to the network neutrality principle, preferential treatment of traffic on the basis of arrangements between Internet service providers and providers of content, applications and services should be allowed only if sufficient safeguards for users’ ability to access, use and impart information are in place. In particular, preferential treatment of traffic should not diminish or affect the affordability, performance or quality of users’ access to the Internet. Internet users should have a real opportunity to choose an Internet connection without preferential treatment of traffic. They must also be informed about the impact that such treatment might have on their ability to access, use and impart information, diverse and pluralistic content that is publicly available, applications and services of their choice.

3.3. If the physical Internet connection is shared between Internet traffic and other services, States may consider imposing reasonable, transparent and proportionate obligations on Internet service providers to carry content which meets general interest objectives.

4. Privacy

4.1. Internet traffic management measures should involve processing of personal data only to the extent that is necessary and proportionate to achieve the purposes set out in the second section of these guidelines. Such measures should be in accordance with Article 8, paragraph 2, of the Convention for the Protection of Individuals with regard to Automatic Processing of Personal Data (ETS No. 108) and applicable legislation on the right to private life and personal data protection.

4.2. The use of Internet traffic management techniques that are capable of assessing the content of communications is an interference with the right to respect for private and family life. Therefore, such use must be fully in line with Article 8 of the Convention, be tested against applicable legislation on the right to private life and personal data protection and reviewed by a competent authority within each member State in order to assess compliance with legislation.

5. Transparency

5.1. Internet service providers should provide users with clear, complete and publicly available information with regard to any traffic management practices which might affect users’ access to and distribution of content, applications or services. Internet users should be able to obtain information from Internet service providers about Internet traffic management and Internet speeds.

5.2. Competent authorities within each member State should monitor and report on Internet traffic management practices. Reports should be prepared in an open and transparent manner, and made available to the public free of charge.

6. Accountability

6.1. Internet service providers should put in place appropriate, clear, open and efficient procedures to respond within reasonable time limits to complaints from Internet users alleging breaches of the principles included in the foregoing provisions. Internet users should have the possibility to refer the matter directly to competent authorities within each member State and be entitled to timely redress.

6.2. States should ensure in their policy frameworks the accountability of Internet service providers with regard to respect for the principle of network neutrality. Accountability also requires that appropriate mechanisms are in place to respond to network neutrality complaints.

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