Whether it is a trend that will be followed by other countries or not, the UK is moving to put caps on utility spending. David Cameron, the Prime Minister, has summoned the heads of all major utilities to a summit. His aim, and the task of his Culture Secretary Maria Miller, is to bang said heads together and stop them increasing prices beyond inflation.
Interestingly all the telecoms companies with operations in the UK have also been summoned. It seems that they are already seen by the Government as utilities. One industry source, according to UK daily paper the Guardian, says the Government wants to change the way that people are protected from over-spending. The aim is to abolish BillShock, and the way that some believe they will go about it is to impose spending limits, in the same way that credit card companies do.
A main aim of this ‘meeting’ is to abolish practices such as mid-contract price rises. The operators will be asked to separate out the cost of the device so that customers can see exactly what they are paying for voice, texts and data. And switching between providers also needs to be easier, in the eyes of the Government.
Roaming is also on the agenda. Cameron is apparently keen to get some action on ending roaming charges before European regulation comes into force. This, you will remember is the law that the European Commission is being so soggy about. It is worth noting that the regulation to end such charges has now been put back from 2014 to 2017 (another year), by the likes of UK giant Vodafone throwing its weight around.
It would not take a genius to guess that it will be an interesting – probably tense – meeting. Presumably said heads of said commercial companies will point to new (and oddly timely) research from credit rating agency Moody’s which predicts that telecoms sales will drop for the fifth consecutive year in 2014. The very astute might even be armed with the predictions of consultancy Ovum, who believe that even mobile companies will see a reduction in revenues in 2018.
It is a sadly laughable idea that any of these heads of ‘utility’ companies will take along a billing professional. If they did, then maybe billing, the enabler of so much – packages, bundles, control, impulse offers, roaming deals and a whole lot more – would finally take centre stage.
Instead, this might be the moment that large telecoms companies actually do become utilities. If the ‘big boys’ are to filed under ‘utilities’, then one thing is for sure. As in the US, where regulations to protect customers against BillShock have been in action for a while, two things will happen.
First, it will mean that some very unhappy CEOs will be asking how to stop BillShock when they get back to the office. This will spark a real-time charging system spending spree.
And it will also see the eventual launch of several MVNOs, with stripped down support infrastructure, minimal if any customer service agents and cheap, clean, clear pricing plans. This is already taking hold in the US, with the arrival of two or three MVNOs owned by AT&T, Sprint and others.
Since large companies cannot innovate, they need to breed a new strain of communications companies that can. This will leave themselves to be the ‘costs cut to the bone’ carriers that service the innovation brought to them by the start-ups. And supported by billing and charging systems that Marketing can finally understand.
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