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COVID-19 – what’s the prognosis for resellers?

Sharon McDermott, founder of Trenches Law, argues that a little give and take is needed if everyone in the telecoms industry is to survive the COVID-19 crisis

When I spoke to wholesalers and resellers in the days immediately after Boris Johnson’s lockdown decision, there was broad consensus on what needed to happen next.

Organisations throughout the channel expressed the opinion that straight-talking conversations and mutual cooperation were required to get through this period of unrivalled economic uncertainty. There was also a hope – a yearning in many cases – that the dust would soon settle and the establishment of a ‘new normal’ would bring a sense of clarity to the situation so that organisations could consider ‘what next’.

Today, in mid-April, the landscape continues to evolve, and there is rising concern about the long-term commercial impact of the crisis, particularly for resellers.

In this context, it is important to acknowledge one of today’s most widely used phrases, employed daily by the Government and media: ‘these are unprecedented times’. It would be unfair to criticise any business for the decisions they make to get through the COVID-19 crisis and we must presume – and hope – that management teams are genuinely making the best decisions they possibly can for their workforces and their customers, in the face of a situation they’ve never encountered before.

That said, I can’t help but worry that the sterling efforts of some – the genuine attempts to go above and beyond to protect job security, customer satisfaction, business longevity, the nation’s connectivity and ultimately to do what’s right – will be hampered by the decisions of others, with potentially catastrophic consequences for the channel.

For instance, the Government has encouraged local authorities, where possible, to relax the scheduling of street works notices so that ISPs can go about their business and keep the country connected without having to wait up to three months for permission to dig up a road. However, this is still at the discretion of individual councils, which could limit its intended benefit.

In another example, the Government has given telecoms personnel ‘key worker’ status so that they can continue to go about their jobs. But, again, there is a disconnect at the local level when it comes to communal areas, for example, and the perceived legitimacy of operators being at work. Abuse from members of the public – with videos going viral on social media – has raised concern for the morale of employees, not to mention their welfare when people break the 2 metre social distancing rule to film and shout at them!

The fact that Government guidance mainly relates to street works also means that while national infrastructure network builds are still going ahead there is comparative ambiguity when it comes to the question of entering people’s premises.

That’s seemingly why BT Openreach, for instance, is progressing with such essential works and repairs that can be completed outside, but not accepting new connection requests that require entry into a customer’s home. Limiting the works that engineers carry out is understandable given the need to prioritise their safety and that of the people they would otherwise encounter. Yet this means that some others may face extended outages, which could be devastating for consumers, homeworkers and businesses alike.

Then there is the issue of payments. Many resellers are concerned that several large customers – particularly in the leisure and hospitality sectors – have temporarily closed and are refusing to pay their invoices for services. Faced with frightening cash flow fears – certainly post-April – they are looking for Government grants and pushing requests for flexibility up the chain. But wholesalers’ hands are tied too, and they face some extremely difficult financial decisions of their own.

It is easier said than done, but parties throughout the channel must work together and each give a little to share the burden and hopefully weather this storm together. Creative thinking may be required, but with even greater collaboration perhaps more could be done.

We have seen some fantastic examples of wholesalers doing what they can, when it lies within their control. Initiatives include the reduction of early cancellation charges, the temporary provision of free bandwidth upgrades to healthcare customers and complementary consultancy services. Many suppliers to the channel are doing their bit, too, including us, with our team trying wherever possible to support smaller telecoms businesses that have no legal teams of their own.

Is there an instant fix or an easy way through all of this? Of course not. Would ‘short-termism’ ideally be avoided? In most cases, yes it probably would. At the same time, we’re each rightfully protective of our own staff, safety, cash flow and ultimate survival – in every sense of the word.

All that anyone can ask right now is for everyone to ensure they’re doing all they possibly can to remain fair and to focus on the ‘long game’, when we can hopefully come out the other side together.

www.trencheslaw.co.uk

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