The document discusses trends in communications services and their implications. It notes that consumers are accessing services in new ways like bundling, using smartphones for longer contracts, and accessing the internet on different devices. Overall, consumers are getting more for less as average monthly spending is decreasing while usage increases. Looking ahead, the trends may lead to more targeted pricing, new services from various providers, and essential services moving online. This could impact competition, privacy, and digital inclusion. Regulators may need to address questions around equivalent treatment of bundled services, jurisdiction over new providers, data protection, an "open internet," and ensuring access to essential online services.

1. The Communications Review
Consumer ‘themes’
Chris Taylor
Director of Consumer Policy
4 July 2012

2. Contents
1 Relevant trends and developments
2 What might we expect in the future, how it could affect
consumers and questions for the regulatory framework
2

3. 1. Relevant trends and developments
3

4. A growing number of consumers are placing
increasing demands on communications services
Video footage
4

5. Fixed voice Fewer people own fixed lines but they benefit
from greater competition
Change between 2006-2011
2006 2011 2006 2011
Household phone ownership Household use of
providers
Figure 28 and 9 in the Consumer Experience Research Report
5

6. Internet Consumers changing the way they
access the internet
Change between 2006-2011
75
61
2006 2011
2006 2011
Use of internet
Connection methods/
home ownership
Figure 40 and 46 in the Consumer Experience Research Report
6

7. Mobile Smartphones driving shift towards longer mobile
contracts
38% mobile customers
own a smartphone
80
2006 2011 2006 2011
Length of new contract
connections
Figure 15, 19, 20, and 21 in the Consumer Experience Research Report
7

8. Bundling Over half purchase now bundle services together with
fixed voice most popular
Current purchasing behaviour
2006 2011
Fixed voice Mobile Fixed bb Pay TV
Figure 64 and 68 in the Consumer Experience Research Report
8

9. Consumers are getting more for less
Consumers are making more use of but spending less
services
Average monthly spend on communications services is decreasing
150 6%
)
s
e 4.78% 4.77% 4.74% 4.66% 4.63% 4.66% d
ic
r £106.50 £104.22
n
e
p £101.49 £98.41 p
2.69 2.70 £96.42 £93.61
0 100 2.72 2.57 2.54 4% s
l
1 28.24 27.75 2.54 a
0 27.85 27.28 t
2
( 27.95 27.97 o
t
h 10.39 11.01 9.91 f
t 10.22 10.38 o
n 9.48
o 50 37.20 2% %
m 36.63 36.26 34.87 s
33.02 31.34
r A
e
p
£ 27.97 26.13 24.76 23.48 22.52 22.27
0 0%
2005 2006 2007 2008 2009 2010
Total Radio
Television Fixed internet
Mobile services As a %age of total household spend
9

10. 2. What might we expect in the future, how it could affect
consumers and questions for the regulatory framework
10

11. Possible future developments 1
Development Implication for Consumers Regulatory questions
and Citizens
Increased industry focus on retention of More bundles and tie-ins Impact on competition?
‘high end’ customers
Targeted customer retention and price Future proof framework for switching,
discrimination in favour of engaged removal of asymmetries and equivalent
consumers treatment of bundle components
Need for good consumer information
More innovation and new services, Increased choice and diversity of services Jurisdictional questions on protection of UK
including ‘over-the-top’ consumers
Regulated and unregulated services
interchangeable Asymmetry of regulation
New capabilities for social media, Privacy and data protection issues
commerce, entertainment etc
Data porting
Dis-engaged consumers get left
behind…….falling volumes and rising prices The ‘open Internet’
on legacy platforms
Platform migration and de-commissioning
Protection of vulnerable consumers
11

12. Possible future developments 2
Development Implication for Consumers Regulatory questions
and Citizens
Government, healthcare and education Digital participation becomes essential Re-setting of definition of ‘essential service’
portals online become main channels for and universal service
delivery of services. Likewise, the Internet
the predominant platform for commerce and Stronger need to drive digital participation
retail.
Current asymmetry of inclusion requirements
between fixed voice and other services is
probably not future proof
New electronic payment methods Convenience of transactions, more choice Establishing the right regulatory boundaries,
of payment methods transparency and joined up consumer
protection for electronic payments
(‘micropayments’)
12

13. We know………
…..that markets in the future will work better if consumers
are empowered and protected, and society will be better off if
no citizens are excluded from the benefits of electronic
communications technologies and services.
13

14. Thank you
14