Regulators have rarely seen the need to intervene in the switch-off of the PSTN, leaving the process and its communication to operators. Only in some countries have they stepped in to protect consumers from service outages in the event of a power cut
The switch-off of the PSTN is underway in several countries, and has already been completed in some. On average, in the countries we’ve observed the process lasted about 7 years. Where it is voluntary and customer-led, it has tended to take longer.
In the majority of cases, the switch-off has been a relatively straightforward process, with wide acceptance of the need to change equipment and relatively few problems encountered. However, in some countries there have been issues with the functionality of some services dependent on the PSTN. In these cases, consumers have generally borne the cost of the changes that needed to be made.
Communication of the switch-off process has generally been left to operators, but regulators stepped in where things went wrong. Germany is a good example of the problems that can emerge due to miscommunication between operators and consumers, leading to cancelled contracts and service disruptions.
There has been little regulatory intervention in the process, with some noteworthy exceptions such as mandated notice periods in France and Croatia, or requirements associated with the USO in Switzerland. With the exception of the UK and New Zealand, no measures are in place to protect consumers from service interruptions as a result of power outages.
Timeframes for switch-off vary widely, with an average of 7 years
The switch-off of the public switched telephone network (PSTN) is in progress in several European countries. In some cases it has already been completed (Germany, Netherlands, Switzerland). We expect France and the UK to be the next to complete their switch-offs. Despite an early start, it is still unclear when Italy will complete theirs (which started in 2012), due to the lack of a clear migration plan.
Across the countries we have observed, two approaches have emerged – either a customer-led process where end users voluntarily switch to VoIP products, or an incumbent-led process where the country’s main operator creates incentives for end users to switch. In some cases the process is a combination of both, with a first phase of voluntary migration followed by an incumbent-led phase (e.g. in the Netherlands, where it started in 2006 but where KPN switched off the PSTN in October 2021, or in Spain where Telefonica introduced commercial incentives to switching in 2016). In New Zealand, migration was initially voluntary, although retail providers Spark and Vodafone became more proactive in moving their customers to VoIP in 2017 citing increasing difficulties in maintenance of the PSTN. The two operators set independent processes in motion, which are both scheduled to end in 2022.
Perhaps unsurprisingly, customer-led processes have tended to last significantly longer than incumbent-led ones (e.g. 15 years in the Netherlands, compared to the planned three years in France) and face less regulatory scrutiny. Customer-led processes are open-ended in that they generally don’t have a set deadline by which they should be completed, whereas incumbent-led processes tend to be subject to a clearer plan (e.g. France, Switzerland, UK). In Germany, Deutsche Telekom’s initial deadline of 2018 was moved back by two years following intervention of the regulator. On average, the switch-off period of the countries we have observed is about 7 years (excluding Italy and Spain, where there is no scheduled end date).
It has generally been a smooth transition, with some notable challenges associated with special services
Consumers’ acceptance of the PSTN switch-off has been generally high across all the countries where it has taken place. Voluntary migration has been common, especially for customers who upgrade their broadband or move house. For example, Arcep in France notes that VoIP subscriptions to the telephony service are currently around 75% and will exceed 85% by 2023, and that the closures planned by Orange for that year will affect less than 1% of all subscribers. In New Zealand, Chorus noted in 2017 that half of homes and businesses in the country were using other technologies. In Spain, the share of VoIP lines grew from 9% in 2012 to 60% in 2020, and largely coincides with the number of FTTH lines (Telefonica only offers VoIP with FTTH, and has incentivised customers to move to FTTH over the years). In Switzerland, Swisscom incentivised customers to adopt VoIP telephony by marketing its benefits (e.g. HD voice, call blocking, call forwarding, name display) and by bundling it with its FTTH products or to copper products that come with its subscription TV offer.
In the countries where the switch-off has been completed, there was generally wide acceptance of the need to make changes to the equipment (i.e. install a modem/router and have a power outlet available). Reports of service interruptions and malfunctions of equipment and service only really emerged in Croatia and Germany, and mainly concerned ‘special services’ such as alarm systems, remote emergency call systems (e.g. those installed in elevators), home emergency systems (social alarm systems) and cash terminals. These issues caused some consumer complaints – a small number in Croatia, but more in Germany – and were generally dealt with by modifying the devices to make them IP-compatible. However, the cost of these remedies would generally fall on the consumer, or sometimes on the provider of the special service, with no burden for the operator. In Switzerland, Swisscom communicated these possible issues ahead of migration and made solutions available to customers – either by providing a mobile alternative, or by converting to IP, at the end users’ expense.
Regulators have seen no need for extensive communication campaigns, but will step in if necessary
Communication of the PSTN switch-off has been largely left to industry. In none of the countries we have observed has there been a large-scale information campaign, comparable for example to those carried out in some countries for the switchover from analogue to digital TV. This could be due to the relatively small number of customers that are deemed to need help with the migration, and because regulators have not identified noteworthy issues with information provided to customers on the migration process. However, France can be singled out as an example of timely and extensive communication, with several stakeholders involved in communicating to end users ahead of time. Arcep, Orange, and the French Federation of Telecoms (FFT) are all providing information, and accompanying customers through the process. With regard to the first stage of migration, which took place in seven municipalities in October 2021, the FFT noted that customers had been contacted on numerous occasions, through multiple means, since August 2020. Orange has a page on its website to track the regions where the switch-off will occur, and has produced videos to inform the public of the changes.
By contrast, Germany is an example of what can happen as a result of poor communication and implementation of the process. Here, BNetzA was initially silent when DT started its PSTN switch-off in 2014, but stepped in following numerous complaints from consumers about devices not working and contracts cancelled by DT. Many consumers complained that they were forced to terminate their contracts and start new ones with DT, which would involve a new minimum length (generally 24 months). The regulator set up a working group led by its Committee for Technical Regulation in Telecommunications (ATRT) with DT and other stakeholders. The group held regular meetings, and monitored the way in which DT was communicating with customers (including the content of the letters it would send). DT even had to set up a test centre for special services (e.g. social alarm systems for the elderly or for people with disabilities), where service providers and equipment manufacturers could check compatibility with the IP network. In 2018, the ATRT found the need to better inform a broader audience about special services such as alarm systems, house emergency calls, remote metre reading or billing systems. To address that, it published a guide on BNetzA’s website. Eventually, in 2019 BNetzA stated it was satisfied with the improvements brought about by the dialogue between operators, resulting in a reduced number of complaints.
In most cases there has been limited regulatory oversight of the switch-off
Across the countries we’ve monitored, regulators have seen little reason to intervene in the switch-off process, especially where it has been lengthy and customer-led. Only in three cases (France, Croatia, Switzerland) have measures been imposed, to give consumers adequate notice and sufficient time to replace their devices. Arcep in France has been the most hands-on, imposing a five-year notice period on Orange in 2014 to prepare consumers and ensure there are adequate alternative products on the market. The regulator is also receiving any complaints consumers may have, and facilitated discussions with industry between 2015 and 2016. This should ensure a good level of customer readiness for the process that will take place in the coming years, and mirrors the approach taken by Arcep for the retirement of Orange’s copper network in guaranteeing ample time and extensive communication between stakeholders. In Croatia, HAKOM required Hrvatski Telekom (HT) to inform end users about the migration three months in advance, having received a few complaints from customers in the initial stages of the process. In Switzerland, the regulator OFCOM largely left the process in the hands of Swisscom, but a provision in the Universal Service Obligation required the operator to provide an interface for analogue and ISDN equipment free of charge to customers who requested it until the end of 2021 to allow sufficient time for customer equipment to be replaced.
Only in New Zealand and the UK have regulators protected consumers from the risks of power outages
With the exceptions of the UK and New Zealand, regulators have generally been silent on the issue of some VoIP services not working during power outages. Ofcom in the UK requires operators to provide customers with an option to contact emergency services, such as a battery back-up or a mobile phone, so that end users are covered for at least one hour. The solution should be suitable for customers’ needs (e.g. taking into account whether they live in an area with poor mobile coverage, or they are housebound, or have a greater need to call emergency services). At a minimum, it should be provided free of charge to those customers who are at risk as they are dependent on their landline. The damage caused by recent storms in the UK highlighted the importance of having appropriate solutions in place, as a significant number of consumers were left unable to call for help from their homes. In New Zealand, recent legislation has set out clear protections for vulnerable customers, and directed the Commerce Commission to make a code to guarantee that they can contact emergency services during a power failure. The code was introduced in November 2020, and requires operators to communicate to new and existing customers that landline services may not work in a power failure, as well as the ways in which they can protect themselves during these events and a process for consumers to apply to be accepted as vulnerable customers. This needs to be communicated to consumers once a year. From August 2021, retail providers are required to ensure that any alternative means they supply is appropriate for the circumstances of a vulnerable consumer, operates for at least eight hours, and is replaced at least every 36 months. Customers in receipt of these solutions do not incur any charges for their provision.
Elsewhere, the absence of such a requirement is not necessarily due to a lack of oversight by the regulator. For example, BNetzA in Germany believed it would be disproportionate, due to the high adoption of mobile and of ISDN lines (where power from the exchange is not available). In France, the vast majority of PSTN devices already required external power supply and wouldn’t have worked anyway. The FFT suggested the provision of a battery backup as a possible solution for certain special services, without specifying whose responsibility it would be to provide the battery backup. Consumers in Spain will also have to solve the problem by themselves, despite legislation adopted in 2011 requiring operators to ensure the continuity of the telephone service for at least four hours in the event of a power outage. Technologies incompatible with remote supply from the network operator (e.g. FTTH) are exempt from the requirement, leaving it up to consumers to find a suitable solution.
