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Last Updated: Thursday, 29 March 2007, 16:27 GMT 17:27 UK
Net phone service rules announced
Man using VoIP
Providers will be required to tell users about service limitations
Net phone service providers must be upfront about the limitations of their services, regulator Ofcom has said.

It said suppliers in the fast-growing Voice over IP (VoIP) sector must explain when selling services whether they include emergency services access.

Providers, including Skype, must also spell out other limits, including where directory listings are unavailable.

The number of UK net phone users, attracted by cheaper calls, is forecast to rise to three million by 2008.

Customers are increasingly drawn to offers which can allow free calls to friends and relatives worldwide.

Operator access

Providers must now spell out whether or not the phone would go dead during power cuts.

They must also make clear whether operator access and itemised calls are available.

Ofcom will continue to review and develop its approach to regulation to ensure that consumers gain the full benefits of VoIP services

And they must let consumers know if they will be able to keep their telephone number should they switch providers later.

An Ofcom spokesman said: "As usage in the UK continues to grow, and the market develops further, Ofcom will continue to review and develop its approach to regulation to ensure that consumers gain the full benefits of VoIP services."

But provider Vonage said the code of conduct did not go far enough in protecting consumers.

Managing director Kerry Ritz said: "The bigger issue is the barriers consumers face in being able to drop their regular landline and replace it with a VoIP service," he said.

"For example, people who just want VoIP and broadband access still pay for having a traditional telephone line they do not want and do not use."

Such obstacles left the UK at risk of falling behind other countries with a more "advanced communications market".

Warning labels

Service providers will also be obliged to get customers to sign acknowledgements stating they fully understand any limitations.

And service equipment must be labelled with warnings about limitations.

Where software downloads are necessary, the same warning must be featured on screen.

Ofcom plans to consult later this year on whether net phone services should be forced to provide access to emergency services.

That follows an earlier consultation which raised concerns over a lack of access to emergency services via VoIP services.

Other providers of VoIP services in the UK include BT, Orange and Tesco.

Some had previously said plans to regulate the industry were unnecessary.

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