BT is to start charging ISPs which fail to provide departing customers with MAC codes - which help make moving provider seamless.

Many internet service providers are slow or unwilling to issue the Migration Authorisation Code (MAC) to rival providers and as a result BT has decided it will start imposing a penalty charge of £33.75 from May 2007.

"If service providers participate in the MAC code process the cessation charges will not apply", a BT spokesperson told The Register.

The MAC code should allow customers to switch easily between providers via BT's Openreach, which installs and maintains services for communication providers. But in many instances this is not happening and as a result Openreach has been footing the bill.

This has also led to lines being cut off because the code had not been issued in time causing a break in service and frustration for the user.

Mark Main, a senior broadband analyst at Ovum, said the lack of regulation means "there is no yardstick" and that "the industry needs to grow up".

He advised that one possible solution is a model similar to that applied to the mobile industry, whereby providers are required to issue a PAC(Porting Authorisation Code) code within 28 days to rival operators.

He also said that customers had to shoulder some of the blame and that a "buyer-beware" attitude was needed. "They should stop and ask the question:'what am I letting myself in for?'", he said.

Telecoms regulator Ofcom is expected to provide guidelines to ISPs early next year. But while issuing the code between ISPs remains voluntary it is unlikely that all will participate.

In related news, BT Wholesale Broadband is to cut its pricing structure once 1.5m lines have been unbundled, offering an alternative to Local Loop Unbundling (LLU) for service providers.

It is planning to reduce its main product – BT Ipstream – by nine per cent from May next year.

BT Wholesale head of strategy Cameron Rejali said: "These pricing proposals will help our ISP customers develop their business plans and compete effectively in the broadband market." ®

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