TalkTalk Group

TalkTalk Telecom Group plc
TalkTalk
Public limited company
Industry Telecommunications Internet television
Founded February 2003 (2003-02)
Leeds, England, U.K.
Headquarters London, United Kingdom
Area served
 United Kingdom
Key people
 Sir Charles Dunstone
(Executive Chairman)
Tristia Harrison
(CEO)
Products Fixed line and mobile telephony, Internet services, digital television
Revenue £1,838 million (2016)[1]
£131 million (2016)[1]
£2 million (2016)[1]
Subsidiaries TalkTalk Business
TalkTalk Technology
TalkTalk TV Store
Website www.talktalkgroup.com

TalkTalk Telecom Group plc (commonly known as TalkTalk Group, trading as TalkTalk) is a company which provides pay television, telecommunications, Internet access, and mobile network services to businesses and consumers in the United Kingdom. It was founded in 2003 as a subsidiary of Carphone Warehouse and was demerged as a standalone company in March 2010.[2] Its headquarters are in London.[3]

Originally just a provider of fixed line telephony services to consumers, TalkTalk now offers fixed and mobile telephony and broadband services to consumers under the TalkTalk brand, and telephony and broadband services to business customers under the TalkTalk Business brand. Like some other UK broadband providers, TalkTalk has invested in its own exchange infrastructure, known as local-loop-unbundling (LLU), with 92% of its customer base unbundled as of December 2012. Since August 2012, TalkTalk has become the UK's second quadruple play service after Virgin Media, offering TV, broadband, phone, and mobile services.

TalkTalk is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.

The company has been rated multiple times among the worst landline and broadband providers.[4]

History

Establishment

The Carphone Warehouse's acquisition of Opal Telecom in November 2002 gave it its own switching network providing access to BT Wholesale's landline network. An initial trial was conducted in the Manchester region, and three months later, TalkTalk launched with a guarantee that calls would be cheaper than with their perceived chief competitor BT. TalkTalk Broadband was launched in November 2004.[5]

On 11 April 2006, TalkTalk launched a new broadband service which was promoted as "Free broadband forever" and which offered up to 8 Mbit/s with a 40 GB monthly usage limit for life to all subscribers to their Talk3 International telephone tariff at £20.99/month. Conditions included signing up for a minimum 18-month contract and a £29.99 initial connection fee. That same year, the Advertising Standards Authority (ASA) challenged the legitimacy of TalkTalk's claim that this service was truly "free".[6] Due to the high number of customers who signed up to the free broadband service, the "Free broadband forever" launch suffered complaints with regard to a long waiting list to join the broadband programme and many difficulties in contacting TalkTalk customer services. In a Sunday Times interview, TalkTalk chairman Charles Dunstone admitted that Carphone's TalkTalk business was "struggling to cope" with the more than 400,000 customers who signed up for high-speed Internet access in the time since the service launched.[7] TalkTalk allowed customers to escape the binding 18-month contract for broadband "if it had failed to keep its service commitments in their case".[8] To the Mail on Sunday, Dunstone stated "In about 20% of customers there is some kind of problem with the phone exchange, the line, or something else.[9][10] A customer satisfaction poll by uSwitch in November 2006 placed TalkTalk and Orange joint bottom for customer satisfaction.[11]

By 2005, TalkTalk had 2.5 million customers following the acquisitions of the UK subsidiaries of Tele2 for £11.5 million and One.Tel for £169.6 million.[12] Carphone Warehouse purchased the UK ISP business of AOL in October 2006 for £370m and renamed it AOL Broadband.[13] This had risen to 2.7 million customers by January 2009.[14]

Demerger

TalkTalk Group head office in Evesham Street, London

In November 2008, Charles Dunstone was reported to be looking to demerge TalkTalk from the main Carphone Warehouse business.[15] The split was confirmed in April 2009, with plans for TalkTalk to become a separate listed company.[16]

Carphone Warehouse agreed to purchase the UK subsidiary of Tiscali in May 2009 for £236 million.[17] The purchase was approved by the European Union Competition Commission in June 2009,[18] and the sale was completed on 6 July 2009.[19] Carphone Warehouse confirmed the business would merge into TalkTalk ahead of the planned demerger.[20] The Carphone Warehouse's full-year earnings statement in November 2009 revealed the TalkTalk customer base had risen to 4.1 million following the purchase of Tiscali UK earlier in the year.[21] Tiscali UK closed to new business on 7 January 2010, and its portal content moved to the TalkTalk website.[22]

In March 2010, TalkTalk and Carphone Warehouse demerged becoming publicly listed companies. Dido Harding became CEO of TalkTalk and Roger Taylor CEO of New Carphone Warehouse.[23]

Recent years

In January 2010, TalkTalk launched a protest against the introduction of the Digital Economy Act 2010,[24] and released a video protesting against the law called "Home taping is killing music".[25] Upon the passing of the bill TalkTalk issued a statement on the company blog confirming it would resist attempts to use the bill against their customers.[26]

In a study carried out by UK telecoms regulator Ofcom in 2010, TalkTalk was found to have average speeds of 7.7-9.3 Mbit/sec, while it was advertised as "up to" 24 Mbit/sec.[27]

TalkTalk was warned by the independent communications regulator Ofcom in November 2010 to rectify its billing systems after 62,000 incorrect bills were sent out. The company was given a deadline to correct the mistakes, which it did not meet, and in August 2011 was duly fined £3 million. Ofcom's figures showed that TalkTalk had incorrectly billed over 65,000 customers between 1 January 2010 and 4 March 2011, mainly relating to issues with integrating Tiscali UK's billing system into its own. The company had been overcharging customers for services that had not been received, resulting in the company paying an additional £2.5 million in refunds.[28]

In November 2014, TalkTalk reached an agreement to purchase the ADSL business of Virgin Media, allowing Virgin to focus on its cable broadband offering.[29] Customers were due to begin transferring to TalkTalk from February 2015.[30]

On 8 January 2015, it was confirmed that TalkTalk would purchase the on-demand entertainment service Blinkbox and broadband business of Tesco for around £5 million.[31] The purchase of Blinkbox was finalised immediately, and the transfer of broadband and home telephone customers was due to be completed by the end of 2015.[32] TalkTalk confirmed it would merge Blinkbox into its existing services.[33]

Also in early 2015, TalkTalk transferred 108,000 broadband customers outside its LLU network to Fleur Telecom, a subsidiary of Daisy Group.[34]

2015 data breach

In October 2015, TalkTalk experienced a "significant and sustained cyber-attack", during which personal and banking details of up to four million customers is thought to have been accessed.[35] TalkTalk stated they had received a ransom demand from a group claiming to be responsible.[36] Some customers complained that they were targeted by criminals before TalkTalk disclosed the cyber-attack, and the Chair of the Home Affairs Select Committee said "Suggestions that TalkTalk has covered up both the scale and duration of this attack ... must be thoroughly investigated."[37]

Having initially stated that all its customers might have been affected, on 24 October TalkTalk issued a statement saying that a "materially lower" amount of customers’ financial information was stolen, and that the stolen data was not sufficient for money to be taken from bank accounts.[38] On 6 November, TalkTalk stated that the impact of the breach was "much more limited than initially suspected", adding that 156,959 customer accounts were involved, from which 15,656 sort codes and bank account numbers had been taken. This amounts to 4% of customers whose financial data is compromised. There were 28,000 partial credit and debit cards stolen, but as these were "obscured" they could not be used.[39] TalkTalk stated the lost data had not been encrypted, but they were not legally required to encrypt it.[40]

The attack cost £42m to TalkTalk and 101,000 subscribers left in the aftermath of the attack. On 5 October 2016, TalkTalk was fined £400,000 by the Information Commissioner's Office for its negligence on securing clients data.[41][42]

2016 malware router infection

On 1 December 2016, TalkTalk routers were infected with a modified version of the Mirai malware, leaving hundreds of thousands of customers without Internet access, because of the inability of TalkTalk to keep the routers securely updated.[43][44] The malware stole the Wi-Fi passwords of the routers.[45] The handling of the Wi-Fi password breach was criticised by several cyber-security experts.[46]

Services

Broadband and fixed-line telephony

TalkTalk provide broadband and landline telephone services for private households. The company provides these services generally together in packages, but also separately. Services were also provided under the AOL Broadband brand, which has been used under licence since Carphone Warehouse bought the ISP. AOL Broadband closed to new business in 2014, although some AOL content is available to TalkTalk customers. Customers are also offered "Homesafe", a network-level online security and website blocking system that TalkTalk introduced in 2011. The system is aimed at parents who want to filter web content such as pornography or violence.[47]

Television

The company is one of seven partners in the television venture YouView, and provides IPTV services including access to YouView. It first inherited an IPTV service from the purchase of Tiscali, and renamed it TalkTalk TV in January 2010. TalkTalk closed the service to new business that year and in August 2012 introduced its new service including YouView, TalkTalk Plus TV.[48]

Mobile telephony

In late 2010 TalkTalk launched a mobile telephone service called TalkTalk Mobile, which operates as a mobile virtual network operator on the Vodafone UK network.[49] TalkTalk have also launched a mobile broadband dongle which allows users to access the Internet on the move although you already need to be an existing TalkTalk customer to sign up to these services.[50]

On November 17, 2014 TalkTalk Mobile announced its intention to switch its MVNO from Vodafone to O2.[51]

Advertising

The TalkTalk brand was launched with a number of high-profile TV advertisements in 2003, featuring the former public face of BT, Maureen Lipman. TalkTalk's first slogan, "It's good to talk, but it's better to TalkTalk", mocked BT's own "It's good to talk" slogan.[52]

Sponsorships

In 2004 TalkTalk won the sponsorship rights to Big Brother from the UK mobile firm O2. Sponsorship continued until the racism controversy of Celebrity Big Brother 2007 after which the company retracted its sponsorship agreement.[53]

TalkTalk began sponsoring The X Factor in 2008, and extended the agreement with ITV plc in May 2013.[54]

Controversies

Sales techniques

In 2005 TalkTalk was accused of using the practice of telephone slamming (changing consumers' residential phone line over to a new provider without their consent).[55] Some cases were linked to instances of mis-selling by sales people on the doorstep or by telephone; other consumers reported that their personal data had been misused after buying mobile telephones from Carphone Warehouse.[56]

In November 2012 the Information Commissioner's Office (ICO) publicly listed TalkTalk as one of a number of companies that it had concerns about due to unsolicited telephone calls for marketing. The concerns were based on complaints. In response, TalkTalk said that it was working with the ICO to address any issues, that the ICO did not plan any enforcement action against it, and that the number of complaints about its telephone marketing calls had fallen.[57]

Phorm click-stream analysis

In early 2008 it was announced that TalkTalk had entered into an agreement (along with BT and Virgin Media) with the former spyware company Phorm to intercept and analyse their users' click-stream data, and sell the anonymised aggregate information as part of Phorm's OIX advertising service.[58][59] At the time, TalkTalk confirmed that the new Phorm system, when implemented, would be a strictly opt-in service.[60] In July 2009, Charles Dunstone, CEO of TalkTalk Group announced that TalkTalk had withdrawn plans to introduce Phorm, along with a similar announcement from BT in the same week.[61]

URL harvesting

On 26 July 2010, The Register reported that TalkTalk had begun harvesting URLs accessed by TalkTalk customers as part of a new anti-malware system it is developing in conjunction with Huawei, the manufacturer of its network servers. When a user accesses a web page, the URL is harvested and the servers issue the same URL request with the intention of checking the site for malicious code. TalkTalk claims that no personally identifiable information is being harvested however, like Phorm, some users argue there are some potential legal issues with this harvesting of information.[62] Under relevant UK legislation, URLs are deemed communications content and interception without permission is prohibited.[63][64]

TalkTalk Ireland

Though TalkTalk never offered its services to customers in the Republic of Ireland, the company maintained customer service centres in Waterford and Sligo. The Sligo centre, originally opened for Toucan, closed in 2010 with the loss of 160 jobs.[65] Some employees were transferred to the centre in Waterford, which at the time was advertising 60 positions.[66][67]

On 7 September 2011 it was announced that the Waterford call centre would cease operations within 30 days.[68] There was speculation in the Irish press that the jobs would be relocated to Southeast Asia and the UK.[69] The Government of Ireland and its agencies criticised how TalkTalk and its subsidiary TalkTalk Ireland Ltd. dealt with the job losses.[70] The TalkTalk call centre in Waterford closed on 7 October 2011, with the loss of over 570 jobs.[71][72]

References

  1. 1 2 3 "Annual Results 2016" (PDF). TalkTalk. Retrieved 28 April 2017.
  2. ↑ Potter, Mark (29 March 2010). "Best Buy eyes May UK launch; Carphone demerger". Reuters. Retrieved 29 March 2010.
  3. ↑ Carphone TalkTalk Launch Press Release, February 2003
  4. ↑ King, Mark (21 July 2011). "TalkTalk again rated worst among landline and broadband providers; The Guardian". Reuters. Retrieved 29 March 2012.
  5. ↑ "The Carphone Warehouse launches TalkTalk Broadband" (Press release). The Carphone Warehouse. 1 November 2004. Retrieved 8 August 2006.
  6. ↑ "ASA Upholds 3 TalkTalk Complaints". ISPReview. 19 July 2006. Retrieved 1 November 2006.
  7. ↑ Durman, Paul (23 July 2006). "Broadband 'nightmare' for Talk Talk". London: The Sunday Times. Retrieved 11 November 2006.
  8. ↑ "TalkTalk customers break contract shackles". The Register. 29 September 2006. Retrieved 6 November 2006.
  9. ↑ "The Sunday interview: Charles Dunstone (the TalkTalk man)". Mail on Sunday. 5 November 2006. Retrieved 6 November 2006.
  10. ↑ "TalkTalk Free Broadband "a disturbing nightmare" says CEO". CNET. 8 November 2006. Retrieved 8 November 2006.
  11. ↑ "Punters suffer in broadband price war". The Register. 14 November 2006. Retrieved 14 November 2006.
  12. ↑ "Annual Report 2005" (Press release). The Carphone Warehouse. 2005. Archived from the original on 6 November 2006. Retrieved 4 November 2006.
  13. ↑ "Carphone Warehouse buying AOL UK". BBC News. 11 October 2006. Retrieved 28 November 2011.
  14. ↑ Wray, Richard (15 January 2009). "Carphone Warehouse weathers economic storm". The Guardian. Retrieved 11 January 2015.
  15. ↑ "Carphone mulls TalkTalk spin-off". BBC News. 18 November 2008. Retrieved 11 January 2015.
  16. ↑ "Carphone Warehouse plans to split". BBC News. 22 April 2009. Retrieved 11 January 2015.
  17. ↑ "Carphone to purchase Tiscali UK". BBC News. 8 May 2009. Retrieved 11 January 2015.
  18. ↑ Felix, Bate; Tutt, Nigel (30 June 2009). "Carphone wins EU approval for Tiscali UK buy". Reuters. Retrieved 11 January 2015.
  19. ↑ "Carphone Warehouse CPW Completion of Tiscali Acquisition". Bloomberg. Retrieved 11 January 2015.
  20. ↑ Clark, Nick (28 November 2009). "Carphone to unveil TalkTalk chief". The Independent. Retrieved 11 January 2015.
  21. ↑ "Carphone raises profit forecast". BBC News. 27 November 2009. Retrieved 11 January 2015.
  22. ↑ Carphone announces death of Tiscali UK David Meyer. ZDNet UK. 7 January 2010
  23. ↑ Carphone puts demerger details on the table Sean Buckley. Fierce Telecom. 1 February 2010
  24. ↑ Barnett, Emma (26 January 2010). "TalkTalk 'would fight Digital Economy Bill in court'". The Daily Telegraph. London. Retrieved 24 May 2010.
  25. ↑ "Home Taping is Killing Music, by Dan Bull". YouTube. Retrieved 11 January 2015.
  26. ↑ Electricpig.co.uk, TalkTalk boss says it will fight government anti-piracy plans.
  27. ↑ "Ofcom - UK fixed broadband speeds, November/December 2010". ofcom.org.uk. 2 March 2011. Retrieved 3 April 2015.
  28. ↑ "TalkTalk and Tiscali UK fined £3m by Ofcom". BBC News. 18 August 2011. Retrieved 18 August 2011.
  29. ↑ Doku, Ernest (14 November 2014). "Virgin Media sells remaining copper broadband customers to TalkTalk". uSwitch. Retrieved 12 January 2015.
  30. ↑ Knapman, Helen (7 January 2015). "Virgin Media begins notifying non-cable customers of transfer to TalkTalk". Money Saving Expert. Retrieved 12 January 2015.
  31. ↑ Molloy, Antonia (8 January 2015). "Tesco sells Blinkbox and broadband service to TalkTalk". The Independent. Retrieved 11 January 2015.
  32. ↑ Kubiak, Paloma (8 January 2015). "TalkTalk to take over Tesco broadband and home phone customers". Money Saving Expert. Retrieved 12 January 2015.
  33. ↑ Williams, Christopher (8 January 2015). "TalkTalk to shutter loss-making Blinkbox Movies service". The Telegraph. Retrieved 12 January 2015.
  34. ↑ Ferguson, Andrew (3 February 2015). "TalkTalk dumps rural broadband customers". Think Broadband. Retrieved 31 December 2016.
  35. ↑ "TalkTalk cyber-attack: Boss 'very sorry for security breach'". BBC News. BBC. 23 October 2015. Retrieved 23 October 2015.
  36. ↑ Adam Withnall (23 October 2015). "TalkTalk cyber attack: Company receives ransom demand from 'hackers'". The Independent. Retrieved 24 October 2015.
  37. ↑ David Barrett (23 October 2015). "TalkTalk faces new questions over cyber attack". Daily Telegraph. Retrieved 24 October 2015.
  38. ↑ "TalkTalk cyber-attack not as bad as first thought, company says". Guardian. 24 October 2015. Retrieved 24 October 2015.
  39. ↑ "TalkTalk hack 'affected 157,000 customers'". BBC News. 6 November 2015. Retrieved 6 November 2015.
  40. ↑ Kelly Fiveash (25 October 2015). "TalkTalk attack: 'No legal obligation to encrypt customer bank details', says chief". The Register. Retrieved 27 October 2015.
  41. ↑ TalkTalk's Cyber Security Negligence Gets Hit With £400,000 ICO Fine
  42. ↑ TalkTalk fined £400,000 for theft of customer details - BBC News
  43. ↑ TalkTalk and Post Office routers hit by cyber-attack
  44. ↑ TalkTalk and Post Office broadband cyber-attack kicks nearly 500k users off internet | Daily Mail Online
  45. ↑ TalkTalk wi-fi router passwords stolen - BBC News
  46. ↑ TalkTalk's wi-fi hack advice is 'astonishing' - BBC News
  47. ↑ "TalkTalk launches HomeSafe website filter". Which?. 9 May 2011.
  48. ↑ "Strategy update and Q1 Interim Management Statement". talktalkgroup.com. Archived from the original on 22 October 2014. Retrieved 3 April 2015.
  49. ↑ "TalkTalk and Vodafone UK announce new MVNO partnership". Archived from the original on 1 August 2010.
  50. ↑ "Do I have to be an existing customer to take mobile services?".
  51. ↑ "TalkTalk ditches Vodafone and switches MVNO to O2".
  52. ↑ "Now cheeky Carphone hires BT's Lipman". The Guardian. 3 June 2003. Retrieved 28 April 2017.
  53. ↑ Haines, Lester (2007-01-18). "Carphone Warehouse hangs up on Celebrity Big Brother". The Register. Retrieved 2013-08-01.
  54. ↑ Ridley, Louise (21 May 2013). "TalkTalk to sponsor fifth X Factor". Media Week. Retrieved 20 October 2013.
  55. ↑ Brignall, Miles (23 April 2005). "When slamming the phone prompts a row". London: The Guardian. Archived from the original on 11 January 2015. Retrieved 30 April 2008.
  56. ↑ "Phone scam hits thousands". Daily Mail. 25 April 2005. Archived from the original on 23 October 2015. Retrieved 30 April 2008.
  57. ↑ Core, Kevin (16 November 2012), Commissioner names firms over 'nuisance' marketing calls, BBC News, archived from the original on 20 September 2015, retrieved 8 February 2013
  58. ↑ "ISP data deal with former 'spyware' boss triggers privacy fears". theregister.co.uk. Retrieved 3 April 2015.
  59. ↑ "How Phorm plans to tap your Internet connection". theregister.co.uk. Retrieved 3 April 2015.
  60. ↑ "thinkbroadband :: TalkTalk make Phorm opt-in". thinkbroadband.com. Retrieved 3 April 2015.
  61. ↑ Phorm stranded as BT and Carphone pull plug on online ‘spying’ technology The Times, 7 July 2009
  62. ↑ "TalkTalk BlogBlog - TalkTalk BlogBlog". talktalkblog.co.uk. Archived from the original on 12 October 2013. Retrieved 3 April 2015.
  63. ↑ "TalkTalk turns StalkStalk to build malware blocker". theregister.co.uk. Retrieved 3 April 2015.
  64. ↑ "Customer outrage over TalkTalk monitoring web use". Telegraph.co.uk. 29 July 2010. Retrieved 3 April 2015.
  65. ↑ "300 jobs to go in Sligo closure and Cork cutbacks". Irish Times. 27 November 2009. Retrieved 23 March 2010.
  66. ↑ "Talk Talk to create 60 jobs in Waterford". Irish Times. 9 December 2009. Retrieved 23 March 2010.
  67. ↑ "TalkTalk Waterford jobs after Sligo closure". RTE. 8 December 2009. Retrieved 23 March 2010.
  68. ↑ Roche, Barry (8 September 2011). "Southeast shocked at decision by Waterford call centre to close with loss of 575 jobs". The Irish Times.
  69. ↑ "Talk Talk: 600 jobs go to Asia where wages are 90 pc lower". Irish Independent. 8 September 2011.
  70. ↑ "Talk Talk decision 'devastating' - Kenny". RTÉ News. 8 September 2011.
  71. ↑ "TalkTalk call centre shuts doors". Irish Times. 7 October 2011.
  72. ↑ Kane, Conor (8 October 2011). "End of the line for TalkTalk workers". The Irish Times.
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