Ofcom today published proposals to extend the NTS retail uplift and PRS bad debt surcharge wholesale charge controls for Number Translation Services and Premium Rate Phone Services. Their websites writes…

1.1 NTS Retail Uplift and the associated PRS Bad Debt Surcharge are wholesale charge elements of BT’s charges for Number Translation Services (‘NTS’) call origination. NTS calls are calls to 08 numbers ^(-1-) and 09 numbers (09 numbers are also known as Premium Rate Services (‘PRS’)). These numbers provide individuals and organisations with a combination of call routing services and a mechanism to charge callers small sums. This allows them to provide a wide range of services to callers, including sales lines, customer service/enquiries, information and entertainment services.

1.2 We require BT to originate and to retail NTS calls on behalf of other communications providers (‘CPs’). Through the existing controls we allow BT, when it originates NTS calls, to retain an amount to cover its costs including an element of its own retailing costs. These specific retailing costs are referred to as the NTS Retail Uplift. For the higher priced PRS calls we allow BT to retain a percentage of revenue to recover the higher level of bad debt encountered on these calls via the PRS Bad Debt Surcharge.

1.3 In our recent market review consultation “Review of the Fixed Narrowband Services Wholesale Markets” published on 19 March 2009 ^(-2-) (the ’2009 Wholesale Market Review’), the key findings and proposals relevant to this consultation are that:

1. there is a market for wholesale call origination on a fixed narrowband network in the UK, excluding the Hull Area ^(-3-);
2. BT has Significant Market Power (‘SMP’) in this identified market ^(-4-);
3. BT should continue to be subject to the NTS remedy to address its SMP in this market. We therefore proposed to revoke the existing SMP services condition, SMP condition AA11(the ‘NTS Condition’) and re-apply it in its current form, which includes the maximum retention allowed by BT for the PRS Bad Debt Surcharge ^(-5-);
4. we also proposed that, it is necessary to have a charge control applied to the NTS Retail Uplift charges, with the specific details of the charge control to be addressed in a separate consultation to allow CPs providing NTS services to make effective use of the NTS call origination remedy BT is obliged to provide.

1.4 In this consultation therefore we consider the details of the NTS Retail Uplift charge control remedy flowing from the market analysis in the 2009 Wholesale Market Review. We are seeking views on the form and the level of these charge controls which we propose should take effect on 1 October 2009 and apply for a period of 4 years. We are also seeking views on the methodology used to calculate the charges. In addition we are seeking views on a proposed increase in the Premium Service Bad Debt Surcharge.