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O2 not likely to face fine

Telefonica's UK cellco, O2, isn't likely to be fined by regulator Ofcom for a 24-hour outage this week.

Analysts believe the operator should pay compensation to customers for the loss of service, which affected its 2G and 3G networks from lunchtime Wednesday through lunchtime Thursday, but that regulatory intervention is unlikely.

Should Ofcom fine the firm? The outage came just as Hong Kong's regulator penalized local carrier SmarTone for a six hour outage in April, so it's not like there isn't precedent for such action. Ofcom told me it will speak with O2 to understand the nature of the problem, though the carrier has been cagey about the cause, issuing only apologies and updates on its home page.

Reports suggest the issue relates to the way handsets register with the network, though when you think of it that's a pretty vague description. We need to know why handsets were struggling to talk with the network (answers on a postcard please).

In any event, compensation would seem the most basic choice for Telefonica right now. France Telecom recently coughed up over an outage on its network, and volunteering to give something back to subscribers may help O2 fend off any potential fine. It may also ease the anger of subscribers affected - roughly a third of its 23 million users, according to Reuters.