What impact does politics have on telecoms?

Posted on: 5th July 2024, by Magrathea

Everyone knows you should probably avoid discussing politics at a dinner party if you want a fun and relaxing evening, but the same might be said for telecoms too.

In my experience many an eye has glazed over when I respond to the inevitable “What do you do?” question from a new friend.  Despite my obvious passion for the industry, it still can come across as dull and unfathomable to some, particularly in the carrier space as we don’t really have a tangible product.

Heck, even my own Mother said to me last week that she should get a discount on her new BT home phone “because you sell them for BT”…I never have!

Anyway, just for fun and to ensure I have riveting content for my next social engagement I thought I would take a look at what impact the outcome of the general election might have on our sector, specifically whether we can expect Ofcom to behave any differently now we have a new Government in place.

The first thing to note is that Ofcom’s role as our regulator is conferred through law, via the UK Communications Act 2003.  Superseding a previous similar act but bringing together more strands of comms for Ofcom to oversee.

We know that it’s the job of the Government to ensure legislation is implemented so, although Ofcom act independently, Government are there to keep an eye on what Ofcom do.  In addition, Ofcom do work closely with the government to advise and provide representation on relevant issues.

The Secretary of State produces a statement of strategic priorities and Ofcom then have to propose what they are going to do in order to promote those priorities, eventually that reaches us as a draft ‘Annual Plan of Work’ giving industry and consumers an opportunity to comment.

With all this in mind, in theory a change of Government shouldn’t have a massive impact on the work of Ofcom and the way they regulate our industry, at least not for a while.  Inevitably though, as priorities shift, there will be a knock-on impact down to through the ranks to Ofcom.  After all, the current heavy focus on topics such as nuisance calls and switching was heavily influenced by pressure from MPs.

Another recent example of Government influence was them deciding they wanted to pass legislation that would give Ofcom a new duty to “have regard to the desirability of promoting economic growth”.  This update to The Deregulation Act 2015 essentially means that Ofcom need to be very mindful of activities that promote economic growth and more importantly those that don’t, so they can assess the impact of their work.

The requirement is clear that the regulator must strike a balance between effective protections for the consumer against what might be best for sustainable economic growth.  The intent is to empower Ofcom to make smarter regulatory decisions.   This was approved in Parliament in April of this year; time will tell if this will make any difference!

Now that we understand the relationship between Ofcom and Government, we can look at what Labour included in their manifesto that might impact things for us.  In fact, Labour had the most to say by declaring that “Regulators are currently ill-equipped to deal with the dramatic development of new technologies” and that they will create a new ‘Regulatory Innovation Office’ which would bring together existing Government functions.  The intent is to help regulators respond faster, speed up approval times and co-ordinate issues better.

There is no doubt that modern technology is more integrated and used with more versatility and imagination than ever before, so a more joined up approach to regulation feels sensible and necessary.

They talk about supporting innovation and removing barriers – taken at face value this is all good news for the telecoms sector!   Like all of the main parties, Labour do appear to recognise that SMEs play a critical role in the economic security of the country and therefore pledge their support.   I guess now we wait and see how this translates into real life legislation.

Through my involvement with CCUK I had recently enjoyed meeting Simon Fell, a Conservative MP who was appointed ‘Anti-Fraud Champion’ and was driving a new Telecoms Fraud Charter through Home Office.  The team of civil servants at the Home Office who were focussed on this complex and very worthwhile project have expressed their ongoing commitment to the work, but of course we will have to wait and see if the focus remains where it had been.

And of course, with my keen interest in encouraging more women into Telecoms, and senior roles generally, it’s exciting to see how many of our new members of parliament are women!  Let’s hope this shift brings us plenty of good role models to inspire a generation.

In conclusion, I still can’t make this interesting dinner party conversation and I really can’t forecast what, if any, difference this is going to make in real terms for our day to day business activity.  However, I do strongly believe that having stability in our Government must inevitably lead to confidence in our economy and therefore more investment, opportunities and innovation.

As always at Magrathea we will be watching, learning and evolving as we need to in order to support our clients and the businesses they work so hard to keep building.

Tracey Wright