The newly proposed rules will apply to the newly adopted broadband universal service, as well as other services.
Background: In 2018, the UK Government introduced legislation for a broadband universal service obligation (USO). This safety net will give homes and businesses the right to receive broadband at minimum speeds of 10Mbps. Ofcom is responsible for implementing the USO and earlier this year, it appointed BT and, for the Hull area, KCOM as universal service providers.
Ofcom will determine net costs and whether they are unfair: Ofcom has now opened a public consultation on another aspect of the USO – that is to establish an industry fund to compensate the USPs for any unfair costs they incur in delivering the scheme. The document proposes rules and procedures USPs will have to follow to make a claim. The claims would be for net costs i.e. the cost of delivering the service minus the benefit associated with being the USP. USPs will have to submit sufficient information to Ofcom, with particular regard to the broadband USO. Ofcom would then determine the existence if any net cost, and will decide whether it would be ‘unfair’ to bear some or all of that cost.
Next steps: The consultation is open until 7 January 2020. Ofcom aims to publish a statement on funding regulation in the Spring of 2020. In the meantime, the broadband USO will come into force on 20 March 2020.
