Telcos must implement "bill shock" prevention measures: ACMA

In its final report from its Reconnecting the Customer enquiry, the industry watchdog has recommended numerous changes to the TCP code by February 2012

ACMA chairman, Chris Chapman

ACMA chairman, Chris Chapman

Australian telcos must implement "bill shock" prevention measures in order for customers to better manage their usage and expenditure, the Australian Communications and Media Authority (ACMA) has advised.

The watchdog released the final report from its Reconnecting the Customer enquiry, which was first launched in April last year to pinpoint major issues between the customer and service providers. The final report recommends five key changes to be made to the Telecommunications Consumer Protection (TCP) code by February 2012.

“All providers should enable customers to track their usage and expenditure on data, calls and SMS during a billing period to help reduce the risk of bill shock," the report reads.

“Consumers should be equipped with the tools they need to manage their telecommunications expenditure, particularly the ability to monitor the accumulation of charges in a plan during a billing period.

“Requiring providers to include on bills a comparative pricing rate, based on the included value of a plan, should also improve consumer understanding of charging arrangements and bills.”

According to ACMA, service providers must offer tools to cover all components within a minimum monthly plan including a notification in the form of SMS or email to alerts consumers of their expenditure and usage at certain points such as 50 per cent, 80 per cent and at 95 per cent.

Telcos should also provide details about the expenditure and usage point reached and the consequences of exclusions, such as roaming costs.

“Service providers should also disclose a customer’s usage on all bills in a form that allows a customer to compare his or her actual usage over a period of time,” the report reads.

The report cites bill shock as a key area of consumer detriment, which is worsened by poor of customer care on the part of the telco, including a lack consumer understanding on how charges are levied and also around how those charges accumulate.

It also claims current online monitoring tools for consumers are unsatisfactory and are insufficient in preventing bill shocks, particularly for disadvantaged customers who are most likely to suffer the most from exorbitant bills.

ACMA chairman, Chris Chapman, said the report had numerous additional findings and recommendations in regard to consumer concerns about service providers.

“All providers should clearly disclose pricing information in their advertisements in a way that will make it easier for consumers to compare plans,” the report reads.

“Advertisements should no longer use words that could be confusing for customers.”

The report recommended all providers give customers a simple explanation of what is included in a plan, how bills are calculated and other essential information they need to know about the plan. Additionally, customers should be able to make comparisons between providers and industry should provide more information about their level of customer care with a focus on resolving customer enquiries.

Telcos should provide a standard complaints-handling process, the report reads, and ensure it meets benchmark standards and includes timeframes for dealing with a complaint.

“We have closely consulted on these outcomes with consumers and industry and the overwhelming response has been that improvements are both urgent and necessary,” Chapman said in a statement.

“The industry should address these concerns as soon as possible so the industry is now formally on notice to reflect these outcomes in the new TCP Code.

“If the industry doesn’t develop a code that addresses the ACMA’s concerns, the ACMA will mandate changes through direct regulation.”

ACMA's recommendations are in line with yesterday’s launch of Optus’ new international data roaming alert system.

The system will enable customers who have downloaded data on their handset while overseas to be notified within “approximately one hour of first usage” that they are being charged for data roaming. It also alerts customers who opt to continue roaming with notifications issued for every 15 Megabytes (MB) of usage as a further measure.

Optus also flagged plans for “the coming months” to launch a text-based alert for postpaid customers if they exceed 80 per cent of the value in their mobile plan, including voice, text and data. Customers will receive an alert if they spend $20 or more on services which aren’t included in their cap, such as international calls or premium SMS.

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Tags Chris Chapmanbill shockACMAtelcosAustralian Communications and Media Authority (ACMA)

9 Comments

Rachel

1

Bill Shock is also a global issue, and is especially troublesome in the in the U.S. and Canada. I have had success avoiding Bill Shock by using Telicost-Lite, a free app that gives iPhone, Android and BlackBerry users instant real-time alerts to track voice, data, SMS and roaming activity to ensure that they don’t go over their mobile plan. Go to www.anomalousnetworks.com to download the free Telicost app by Anomalous Networks. This is a must-have app when traveling for business or pleasure, and businesses of all sizes can take advantage of a more robust Telicost portal to manage their whole fleet of mobile users.

Fernando

2

re: Rachel
Similar apps are available for most other handsets including Huwai, Nokia, Sony, etc. Some are even free! Many phones even have counters built it. I suggest people do their own due diligence and Google solutions for their particular phone and manage their own accounts more diligently. Never the less, there are many cases and examples of some Telcos misusing their "usage meters" and misrepresenting actual data usage by a factor of around 3 to 1. Always check the Telco's own data counter AND your own on your phone.

GrumpyOldMan

3

Why not look at it the other way round. Why not have the facility to seltect a feature that once you've reached your cap be it data or voice you are blocked from using it, you get sent an SMS to accept further charges just respond to the sms. Simple no bill shock but Telco's lose out. This feature should be mandatory. Would have saved my son $156 dollars just for viewing a stupid games video clip.

He's learnt the hard way now.

I built the Great Pyramid

4

How about putting the bloody contracts in plain English? I also agree with GrumpyOld Man; when one reaches their cap, they should be sent a messge advising of this. Fair enough?

This will never happen, for 'bill shock' is how telcos make their bickies. Poor us.

Peter

5

I avoid 'bill shock' by monitoring my own usage and not being a moron. Why should Telcos do this for you?

Pmoney

6

Wait! You mean if I download an entire movie via my phone I could incur excess charges?! Outrageous! How could this be? How could this happen to a poor Aussie battler like myself......?

Wait! The $600 of International Roaming charges I accured in Thailand while drunkenly calling my entire family from a full moon party isn't included in my standard cap? Holy smokes Batman! I assumed it was! Zomg if only I read my contact...... I guess ill go to the Ombudsman now due to my own unintelligence..... This has to be the fault of the Telco.... it couldn't possibly be my own.........

GrumpyOldMan

7

@Peter, you obviously don't have kids. Not everyone is as bright as you. Why can we have caps on Home Broadband that slow your connection after reaching your limit but not a similar scenario on Mobiles. Check this scenario; bought teenage daughter a prepaid phone plane with $50 dollars on it. Did not request a data plan and didn't want one. Data automatically activated as soon as the SIM was put in by the time we got home from the shop she had lost over $20 dollars. These things are contrived to siphon money from the unsuspecting.
What's the issue with having to turn these features on instead of having them on by default.

Peter

8

Can I have her number? I'm desperate for any human contact.....

dale

9

Nothing is worse than opening the mobile phone bill to find it is much more than it should. It is known as “bill shock,” and it happens to a lot of people. CTIA, the trade group for cellular companies, has made an agreement with the Federal Communications Commission to start supplying individuals more advanced notice. This will save many people from getting payday loans to pay for unexpected cell phone bills.

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