Thanks for U-turning on biz-killing ban, Ofcom – now cough up, say GSM gateway bods A former GSM gateway operator is threatening to reactivate a £20m legal claim against Ofcom after the UK regulator's past policies killed his company, according to documents seen by The Register. The unnamed operator is asking the telecoms regulator to enter alternate dispute resolution rather than going straight into court …
So they want compensation for their business that failed based on a technology that was banned, on the assumption that the business would have been a stellar success and been worth millions of pounds; rather than be rendered obsolete and still go bankrupt a few years later due to newer technology, unlimited call packages etc.
If and when cannabis is legalised, will we see a queue of drug dealers outside their local council offices claiming lost profits and compensation for being imprisoned (if ever caught)?
The issue rests upon whether the ban was lawful or unlawful. If the ban were unlawful then businesses may have been destroyed when they should not have been, and unlawful acts are deserving of restitution.
I don't believe drug dealers would generally be in such a position to claim that any past prohibitions and punishments were unlawful. A change of law or regulation does not of itself make past law or regulation unlawful.
However a dealer selling "X" which had been unlawfully considered to be "Y" for which they were punished or lost business would probably be entitled to claim compensation and recompense.
The key aspect to this matter is the timing and the handling of the original case. A number of business started at the turn of the millennium harnessing newly available technology, tech that bore CE accreditations, and enabled businesses to provide LCR (Least Cost Routing) services to consumers and businesses when they needed to call a mobile phone from a landline.
At the time the MNOs (Mobile Network Operators) where imposing a charge on anyone who wanted to reach someone on a mobile phone on their network of about 25p p/min - which was why back then, BT or Mercury were charging the landline customers (that was you) 30p. However, because very little was known about the intricacies of telephony by the masses, the overriding public opinion was that BT (and Mercury) were overcharging their customers and it was sour grapes because they didn't have mobile offerings themselves.
The regulator back then, Oftel, carried out an assessment of the MNOs and found they (the MNOs) had a monopoly when it came to connecting calls to users of their networks. GSM Gateways provided competition to this issue by converting a landline call destined to ring a mobile into being a landline call in effect put on hold, then using a SIM for the destination network to redial the mobile number (and benefit from a cheap same network to same network call rate [tariff]) and then connect the two calls together. This all happened in milliseconds so the person making the call would not be inconvenienced but could benefit from a much more reasonable call cost - half price usually.
The MNOs where beside themselves at the prospect of loosing their supra profit opportunity and so began their march to complain and latterly just disconnect any GSM Gateway operator they thought they'd found using their SIMs whilst also charging the company until the end of the SIM card contract period even though they had blocked the SIMs from being used - jolly sharp practice.
In the end pressure from the MNOs which culminated in government whips lobbying the Home Office (HO) resulted in the regulator (now Ofcom) making a weak finding that stated the use of GSM Gateways when used to provide a commercial service by a business unlawful, but added those people who had already invested in building businesses should work with the MNOs to try to bring their GSM Gateway networks to operate under the MNOs licences with MNO approval - something the MNOs clearly had no intension of doing.
Had Ofcom simple banned the operation at that point the people operating equipment would have had a clear point of finality and some compensation and that would have been the end of it - but the regulator deliberately or through negligence or for other reasons decided it was prudent to in effect delay the closure of the businesses which just made it painful for all.
As far as the consumer and competition was concerned, the MNOs supra profits continued which ultimately empowered them to pick off the FLOs (Fixed Line Operators) as their revenues dwindled as mobile telephone subscriber growth blossomed partly because using landline telephony to call mobiles was priced out (by the MNOs) of the game and it was best to get a PAYG (pay as you go) mobile to call family and friends on their mobiles or in the case of business mobile telephone fleets grew and grew and the MNOs put mini gateways into businesses to keep them happy - something the old GSM Gateway operators were prohibited from doing.
A week or so ago Ofcom decided actually they got it wrong and GSM Gateways should be legalised. Interestedly, Vodafone actually stated in their response that if Ofcom did legalise full commercial operation of Gateways, they wouldn't be amending their internal policy which is now (and has been for some time) to ban them in any event. Quite a bold statement really, they don't care about the law if it effects their profits. Their view is that if you've got a problem with calling mobiles from landlines, you should buy another mobile phone - and most definitely one of theirs!
Consumers 0 - MNOs 1
If you dial 112 from a mobile phone it will tell the operator your location - this is the same as dialing 999 but with extras as it were.
Is it not possible just to put in a blocking system so that any emergency number (999 or 112 in the UK) must be routed directly and not through a gateway?
I find it hard to believe that all calls would be routed through a small number of sites, enough to block them up. But again it should be possible to drop calls if the network is congested to allow an emergency call through.
Yeah, same data presented to the control room. However, there are advantages to using 112 on mobile.
The GSM standard specifies that mobiles will allow you to dial 112 even when the screen is locked. The GSM standard specifies that 112 will connect you to any available network if your MNO is down.
The GSM standard specifies that 112 will connect you to any available network even if you do not have a SIM in the phone. The GSM standard specifies that 112 will get you through to the emergency services, possibly via some sort of indirection like the ordinary operator. That's anywhere in the world. Not just the UK. Not just the EU. Anywhere you can use your mobile, 112 is a guaranteed-to-work emergency number.
Some countries, such as the UK, no longer fully comply with the GSM standard. After too many prank calls made with SIMless phones, 112 will now connect you to the network but if your phone doesn't have a SIM then the call doesn't get routed.
Despite that, 112 is the number to use on your mobile if you're a globetrotter. No more "I'm in Liberia today, what's the emergency number?" it's 112 on a mobile. Provided you have a signal, of course.
@DougS - Read the article, the business didn't immediately go into bankruptcy.
However, Ofcom's action totally destroyed the business'es income stream overnight; however bills and wages would still have to be paid...
As a business owner you have a simple choice: immediately liquidate the business and screw everyone (ie. don't pay staff, don't pay HMRC, etc.) in the hope that you have sufficient assets to cover the debts. Or keep operating for a while hoping to overturn Ofcom's daft ruling.
Obviously, I've omitted a small but important point - the banks. With small businesses they like to be sure they get their money and so will typically insist that borrowings are secured against the owners personal assets, just in case the business fails to generate the income to cover the repayments the banks can hold the owners personally liable....
I think you will find Mr McCabe refers to the fact he has been fighting for justice for 14 years rather than the business had been trading for that long. In almost all cases the businesses had been trading for 1-2 years before Ofcom passed a judgement on the use of GSM Gateways making it unlawful for all those businesses to continue operating.
"In the meantime, Ofcom would emphasise that commercial use of GSM gateways remains illegal. Ofcom has not as yet authorised the use of GSM gateways to provide electronic communications services by way of business to third parties, and until it does, such use will continue to be a criminal offence under the Wireless Telegraphy Act. If such use is brought to Ofcom’s attention, Ofcom may take enforcement action, which could include prosecution under the Wireless Telegraphy Act."
So did they now grant that ?
The Home office argument re 999 calls is technically flawed as these call types would NOT be routed through a GSM Gateway, but would be routed from the normal office land line connection to their existing fixed service provider. This further shows the Home Office's embarrassing lack of technical understanding and operation of GSM Gateways.
Apologies for the late reply but am I missing something as I cannot understand how any emergency number would or could ever be routed via a GSM gateway?
As I understand it a GSM gateway can be used to terminate mobile calls (by passing conventional MNO/BT interconnects). Or as an access onnet for mobile calls to then call foreign numbers, like a two stage call.
So how would an emergency number ever be passed to a GSM Gateway?
In the first case you are quite correct, there is no scenario where a GSM Gateway under normal operation would come to dial 112 or 999 - so in that case it's a red herring.
In the alternative, whereupon a call is placed to 112 or 999 by a GSM Gateway, as unlikely as that may be, the control room would be presented with the underlying CLI of the SIM card that made the call. In many cases they would also have either to hand or via a quick reference access to the IMEI (the international mobile equipment number - the unique code for the handset [or the channel in the case of it coming from a GSM Gateway]), the base station ID from which the call connected to and the subscriber details of the SIM.
Calls to 112 and 999 from a SIM provide an accurate datum insofar as traceability is concerned. The same cannot be said for VoIP where an IP address may well have passed through a number of proxies thereby disguising the originating point on a network.
Friday 15th September 2017
Mahony case dropped regarding operating COMUGS?
It seems that the MNOs, CPS, Ofcom and the Home Office may now have an even bigger issue before them, meeting the compensation claims from a number of previously successful businesses including that of Mr McCabe.
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