WLR3-Opportunity or Threat?

WLR3-Opportunity or Threat?

Matt Atkinson, MD of Aurora Kendrick James

For a number of years Ofcom has pressed for further deregulation of the telecoms industry, specifically to improve competitiveness in markets where a small number of Communication Providers have Significant Market Power. In order that competition could thrive within the calls and lines market, Ofcom wanted to create a framework that would allow all Communication Providers (CPs) to compete on equal terms. This included the ability for CPs to be able to replicate BT Retail’s lines products.

The creation of OpenReach as a business entity and the creation of the WLR3 product (which will be made available via the Equivalence Management Platform (EMP)) is the framework by which BT has set out to achieve this. Openreach and WLR3 were founded on two key principles:

The Equivalence of Access: this means that CPs should all have access to the same wholesale line products from BT (at the same underlying price) so that

BT’s services can be replicated to encourage competition.

The Equivalence of Input: this means that all CPs (including BT Retail) should have access to and use the same systems to order, manage and maintain these line services. This means that BT would have no competitive or technical advantage by having access to systems that other providers did not. Today with WLR2, you can replicate the majority of BT’s core lines products and these are purchased at consistent prices for all CPs. WLR2 does not however provide ‘Equivalence of Input’ and so CPs are potentially disadvantaged when competing with BT Retail. The current system also requires CPs to submit forecasts, which are often difficult to predict.


Advantages of WLR3 to the reseller

The introduction of WLR3 with BT OpenReach overcomes these issues and means that BT and all CPs have the opportunity to use the same system to manage customer lines and orders. The key benefits to a reseller in using WLR3 compared to WLR2 are as follows:

• No requirement to submit order forecasting.

• No system limits on volumes (removal of order rationing).

• Real-time ordering and proactive feedback from BT OpenReach on the order status.

• Single interface for ordering, fulfilment and assurance.

• Access to ‘Dialogue Services’ – providing much greater information about CLIs (Network Features, Current Orders,   Maintenance Care Levels and Type of Line).

• Access to BT OpenReach Appointment Diary for Engineers.

• Ability to reserve new customer telephone numbers.

• Regular updates to keep customers informed on orders and issues.


Disadvantages of WLR3 to the reseller

Clearly the benefits are significant however there are a few downsides:

• The WLR3 product is being phased in over an extended period of time.

• Initially the service will support analogue line orders.

• Digital services will not be available until later in 2007 at earliest.

• Resellers must submit a request to become a WLR CP and go through a rigorous compliance testing for their   systems.

There will be no replacement web portal for the current Service Provider Gateway (SPG) so CPs must either develop their own WLR3 gateway or partner with a 3rd party integrator or billing provider. The current system will be phased out in early 2009. And then there is the cost. The technology and systems needed to support WLR3 are both complex and time-consuming to work with, and as a result upgrading your billing system to work with WLR3 could require a significant investment.

There has been much speculation within the marketplace and some industry specialists have estimated the cost of the system could be in the region of £50-100k for the average reseller. As a result, the cost of developing a stand-alone system for most resellers will be prohibitively expensive or will force resellers to partner with businesses who will provide order systems on a licence or per transactional cost basis.


So, what are the options available?

• In-house investment of the technology and development

• Licensing third party technology

• Working with a technology partner such as AKJ

AKJ has for some time reviewed how best WLR3 services can be delivered to our customers. As part of this process they have been engaged in detailed discussions with BT Openreach, industry specialists and organisations that could potentially support them bring these services to their customers.

Matt comments “AKJ has always worked on the basis that core developments that are in the best interest of our customers to keep their systems up to date should be part of the service that we offer.We have reviewed the costs and whilst these are significant, we have reached a scale where we are delighted to say that we will not look to recharge these costs to our contracted customers.”


In Summary

WLR3 is no doubt a significant step forward for the reseller market allowing greater flexibility and improved service for customers. The project is however a significant undertaking for BT OpenReach and as with all major projects of this nature there are likely to be set-backs and delays for BT OpenReach until the system is fully bedded in.

Whatever approach you chose to adopt for WLR3, whether it is to develop your own system or partner with a billing provider, you have the time to consider the options available and to take stock of where you think your business will progress to in the next 18 months before you make your decision or commit to any investment.

 More Information: www.akjl.co.uk
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