OFTEL Operator Policy Forum

October 2000

Update on Pay for Product

Adam Maxted

Chairman of PfP Committee

Introduction

• Definition of PfP

• Examples of long call PfP

• PfP Committee & Working Parties

• Sequence of events & current status

• Next actions

• Summary

What is Pay For Product ?

• “ The use of premium rate telephone services and a single drop tariff (above £1) to pay for goods or services where they are delivered to the subscriber following completion of the call.”

Types of products & services

Suits low value items under say £20

Examples could include :

• Books

• CDs

• Videos

• Subscriptions

• Ticket sales

• Entertainment & infotainment services

How the order process works by ‘phone ...

• Caller dials PR single drop number

• Connect to IVR and low cost intro

• Freephone cross ref for more info

• Press zero to proceed

• Premium single drop charge applied

• Caller keys in phone no.

• Partial / full CLI match from network

Process continues ...

• Caller records full name & address

• Order Reference no. given

• Call completes

• All of call is recorded

• Fulfilment < 30 days later

• Cost appears on ‘phone bill

How the service works by modem

• Go to web site• Select product and price • Download premium dialler software• Go through disclaimers, cost reminders etc.• Re-connect at premium rate• Enter customer details• Session completes

Why is PfP attractive as a new billing option ?

• Kick start static growth in UK PRS• e-commerce growing - £2.8b in 1998• Mail Order revenues currently £18b pa• Billing alternative to credit card - 49% of

adults 18+ do not have a card• PfP ideal for micro payments• More secure than credit card• Replaces long call PfP - unrestricted

currently

Key issues ...• Legal relationships

• Consumer protection

• Fraud

• Unauthorised use

• Bad debts

• Commercial justification

• Sharing of rev. for collection & billing

• Potential charge backs

Background and objectives of:

• PfP Committee

Overview - merchant / SP perspective

• ICSTIS PfP Working Party looks at :

Consumer protection,legal relationship

• Network PfP Working Party looks at :

Fraud, Unauthorised use, Bad Debts, interconnect & revenue sharing

The PfP sequence of events

• Feb ‘97 - first PfP group set up

• May ‘99 - new PfP committee set up

• June ‘99 - meetings & briefings

• Sept ‘99 - ecommerce@itsbest.com

• Nov ‘99 - BT & Access Control

• Feb ‘00 - PfP report issued

• Mar ‘00 - First Network PfP meeting

PfP sequence of events

• April 00 - First ICSTIS / PfP meeting

• June 00 - Second PfP Network meeting

• July 00 - Second ICSTIS / PfP meeting & release of draft guidelines

• Sept 00 - Presentation to TUFF

• Sept 00 - Briefing meeting with OFTEL

• Oct 00 - PfP main committee to meet

Consumer protectionProposed key features

• Prior permission - application to ICSTIS

• Controlled service

• Trial 12 months

• Compliance with DSD effective Oct. 00

• Abide by ICSTIS Code & Guidelines

• Childrens’ services

• Record all calls - keep for 12 months

• 0907 prefix

What is the likely impact for service providers ?

• Demonstrate reliable product fulfilment• SPs need to be visible • DSD has major implications• Need recording capability • Maintain database of customers’ orders• CLI tracking for checking for excessive

spend / subscriber & fraud• Ultimately liable - bonds ?

Network issues being addressed by PfP Network

Committee• Measures to control fraud• Measures to control unauthorised Use• Minimisation of bad debts• CLI release to SPs• Sharing of revenues for billing and

collection• Credit and retentions • Endorsement of SPS for trial by networks

Summary / Immediate future

• Need clarification / commitment from BT

• OFTEL involvement monitoring process

• Consultation on ICSTIS PfP guideline

• Seek more involvement from other ONOs

• Agree between networks fraud / abuse measures and circulate for implementation

• Agree revenue sharing with networks

For further information...

• Adam Maxted - 07005 34 0900 or

• Updates available from ICSTIS website -

visit www.icstis.org.uk