The long-awaited process should stimulate broadband competition and benefit consumers, but Ofcom remains frustrated with the successive delays in the run up to its launch
Simplified switching process comes into effect after a three-year wait
On 12 September 2024, Ofcom confirmed that One Touch Switch (OTS) is now live in the UK. Announced three years ago, the process was meant to be implemented in April 2023, but experienced multiple postponements. Led by the dedicated One Touch Switch Company (TOTSCo), OTS aims to help broadband and landline customers switch more easily and quickly between providers by removing the need for them to contact their existing provider. Since 2015, customers of providers that use Openreach’s network – e.g. BT, Sky, TalkTalk – have been able to move to another provider using this network by only informing the new provider (i.e. a gaining or recipient provider-led process). However, customers moving to or from a different network, such as Virgin Media O2, have also had to contact their existing provider in order to coordinate the switch.
Sky is hopeful that OTS will encourage more out of contract customers to engage with the market
Low rates of switching has long been an issue for broadband companies (and Ofcom), with higher speeds and better network reliability often failing to incentivise ‘sticky’ customers, who would rather stay put than face the potential hassle that can come with changing providers. At Connected Britain 2024, Amber Pine (Managing Director, Connectivity, Sky) noted that two-thirds of customers that are out of contract don’t choose to switch providers, pointing to the importance of OTS in simplifying the process. The addition of Virgin Media O2 and a host of full fibre altnets to the OTS process, alongside Openreach’s infrastructure, should mean customers can move to a broader range of alternative options more easily, with potential positive implications for competition. At the same time, however, this could be a double-edged sword for providers, as customers are just as easily able to switch in the case of poor service, especially when outside of their minimum contract term.
Launch of the new gaining provider-led system brings the UK in line with major EU markets
Following transposition of the European Electronic Communications Code (EECC) into UK law in late 2020, Ofcom launched a consultation in February 2021 on proposals for improved switching processes for customers in line with the Code’s objectives. The EECC represents the latest modernisation of the EU’s regulatory framework for telecoms and includes strengthened measures to protect consumers, in particular allowing easier switching between broadband providers. According to our Consumer Protection Tracker, France, Germany, Italy and Spain have all made similar changes to the UK in recent years to ensure switching is recipient provider-led, simplifying the process for consumers and promoting a competitive market environment. Ofcom’s promotion of OTS can therefore be traced back to the ambitions of the EECC, with the regulator considering the process will enable end users to take advantage of unprecedented levels of choice, specifically from the various different fibre networks now present across the country.
Ofcom is prepared to launch additional enforcement action over delays to the introduction of OTS
Despite going live, OTS is not yet fully ready, with Ofcom permitting a six-week transition period, during which existing switching processes remain in place as a safety net. At Connected Britain 2024, Dana Tobak (Founder and CEO, Hyperoptic) stated that teething issues should be expected – although she hopes to gain more than she loses from OTS overall. Trials of the new system were carried out over the summer, with feedback largely positive, but a minority of switches proved unsuccessful due to issues in matching customer information. Having already opened an enforcement programme into industry’s failure to meet the original OTS deadline, Ofcom has expressed its disappointment that OTS is still not available for all customers, labelling the situation “unacceptable”. In an update to its investigation published on launch day, Ofcom demanded full explanations from the largest providers (naming BT, Sky, Virgin Media O2 and TalkTalk) as to why complete implementation was delayed, threatening additional investigations if answers are deemed unsatisfactory. Altnets, who arguably stand to gain the most from increased ‘cross-platform’ switching, have previously accused BT and Virgin Media O2 of dragging their feet and delaying the industry-wide go-live date. Despite widespread relief at the eventual launch of OTS, the goal to improve consumer switching in the UK should not be seen as ‘job done’ and should remain an ongoing priority of both the Government and Ofcom.
