As part of the wholesale voice market review, the regulator will require BT to set out a plan for migration to IP interconnection.
The voice market continues to decline: On 13 August 2020, Ofcom started a consultation on the regulation of wholesale voice markets for the period 2021–26. For the first time, the regulator is combining wholesale fixed and mobile call markets in one review, to reflect the changes that have occurred across these markets over the past years. Despite mobile use on the rise and the population of OTT voice and messaging services, landline use continues to decline. This has resulted in a decline in the combined volume of fixed and mobile calls, and in reduced service revenues for both segments.
Shifting the focus to IP interconnection: Ofcom expects IP to become the main method of interconnection during the period of the market review. As a result, Ofcom plans to require BT to publish a timetable for interconnection migration. The regulator will not set specific charge controls for IP interconnection, although it will make sure it takes place on fair, reasonable, and non-discriminatory terms. From April 2025, BT will have to offer IP interconnection for all landline calls at the regulated termination rate, which means it will not be able to charge for additional services on top of the regulated rate.
What else to expect: Ofcom also proposed to deregulate the market for fixed call origination, since providers will no longer need to purchase the service from BT as they move to more modern methods of supplying calls. Ofcom expects this transition to complete by 2025, and BT has offered voluntary commitments to maintain the service during the transition. Fixed and mobile call termination rates will continue to be regulated, although the regime will be more flexible for calls originating from abroad. UK operators would have to charge no more than the equivalent rates charged by their international counterparties, where those are higher than the UK regulated cap. Finally, the charge control for conveyance of calls to ported numbers will be removed, although operators will still have to set these charges at costs.
