OFCOM Sends an Expensive Warning to UK CSPs

OFCOM Sends an Expensive Warning to UK CSPs
Author: Cameron Kent Marketing Communications Executive
Date: 27th October 2016
Categories: Technology, Data, Telecoms, Revenue Assurance, Vodafone, OFCOM, Billing Systems, Billing & Charging, RA, Customer Complaint, Bill Shock

Yesterday’s breaking news of an unprecedented regulatory fine from OFCOM should be serious food for thought among the UK’s CSPs. Vodafone has been fined £4.6m for “serious and sustained” breaches of customer protection rules – ultimately the punishment for incorrect billing and charging that caused widespread losses for their customers. 

Lindsey Fussell, the Consumer Group Director for OFCOM, said: “Vodafone’s failings were serious and unacceptable, and these fines send a clear warning to all telecoms companies.” The message is certainly loud and clear, this being the largest fine the UK regulatory body has ever issued.

CSPs should not be pleased about one of their competitor’s punishment, rather, their time would be better spent reviewing their own systems and reminding their staff of the utmost importance of maintaining effective Revenue Assurance solutions.

In recent months Vodafone has been scrutinised closely by the media and treated as something of the red devil of the telecommunications industry. Now this is hardly surprising when you look at the way our national footballers are vilified by media outlets for turning in anything less than the perfect match. Having said that, Vodafone are something of a victim of the spree of ‘customer complaint’ articles that led to OFCOM taking serious action.

The “serious failings” can be traced back to Vodafone’s implementation of a new billing and charging system - migrating from several siloed platforms to a singular companywide billing system… this transition caused teething problems. The source of their problems and the reason for so much public criticism simply comes down to issues of technology, and not the customer service that has been targeted so far.

There is a quantifiable danger that telecommunications companies would be recklessly ignoring if they did not retain high quality Revenue Assurance solutions. A successful solution will support the entire Revenue Assurance lifecycle, addressing a wide range of RA challenges:

RA lifecycle

By not procuring an effective RA solution, telecoms operators run the risk of suffering from not only bad debt and leakage, but also reputational damage.

With the rise of Social Media, the viral post, and clickbait articles, we have seen CSPs accused and singled out for inaccurate billing more frequently than before. This is customer churn at its worst – it is not just one customer receiving Bill Shock, but the thousands that may read that article or post.  It is more important than ever for CSPs to be above board when dealing with the customer’s money.

Telcos should therefore be looking for RA solutions that cover their billing & charging responsibilities; the best systems will identify and address any organisational/infrastructure weaknesses that could cause revenue leakage and keep customer satisfaction high through many different methods.  

If your CSP has this in place, then your billing will be precise and you as a customer will be satisfied. Above all that is the most important thing – that the customer is getting what they have paid for, and not being overcharged. At the end of the day, immense customer dissatisfaction is what eventually drove OFCOM into the investigation of Vodafone, all because of an inefficient technology infrastructure.

This might have happened to any CSP, and could be the beginning of a crackdown by OFCOM. Make sure you have the right technology in place to bill and charge accurately.