Telco complaints reach tipping point

29 Jul 11 07:00AM EST
Post by Brendan Mays

Frustration at our telecommunications providers has been allowed to grow to Hulk-like proportions due to years of customer service incompetence and confusing pricing plans that are impossible to calculate. With the number of consumers frequently facing bill shock, it’s no wonder people are angry.

The Australian Communications and Media Authority (ACMA) has been working to fix the industry problems with a proposal called Reconnecting the Customer. Based on research and submissions from relevant parties, it aims to set out new rules and practice guidelines, including:

  • Unit pricing on phone plans.
  • Better standards for misleading terms like “cap” and “unlimited”.
  • Transparent customer service reporting.
  • Better tools to monitor bills, including letting customers know when they are about to exceed their set plan or a set amount.

In a nutshell - it’s a positive step, but there’s still some devil in the details. As the Australian Communications Consumer Action Network (ACCAN) pointed out in its reply to the proposal, unless phone providers remove unfair elements like flagfalls and make plans available with simple, easy-to-understand charge rates, then consumers will continue to face a confusopoly when it comes to phone plans.

However, the Communications Alliance (telco industry body) is not so keen to simplify their product plans. Their response to the ACMA ironically highlights the exact reason why these changes must occur.

“Industry wishes to express its concern regarding the ACMA’s recommendation to state ‘effective prices’, i.e. information aimed at conveying the rates or volumes applicable within the allocated included value of an offer. The reason for Industry’s strong concern lies in the large number of assumptions which would need to be spelled out very clearly in order to avoid providing misleading information.”

If the providers have trouble calculating rates due to the large number of assumptions, how can the average person ever hope to work it out? They manage clearer pricing in the UK and the US (just look at this table from, so despite the excuses, it can be done.

By dropping the flagfall and creating some flexible talk time/text comparison scales, we could assess what’s really included in plan “value”. In the same way, peak and off-peak plans (where they exist) could also be evaluated on a set scale.

dd that to the suggested mandatory SMS or phone call when the account is about to reach the plan limits, and prevent providers charging over the cap without informed consent, and many of the problems would go away.

To go one step further would be to recommend telcos provide a call-back request facility that uses a free call number or website to log your call and problem. Then instead of waiting for hours on hold and being transferred across different departments, people could actually resolve problems quickly rather than spend hours on holding building anger.

It can’t be that hard.

This video uploaded to YouTube shows one person's frustation with his mobile provider.

Have you had any problems in the past with your phone or internet provider, and what would you most like to see change?

Last week…

Coinciding with the CHOICE submission to the RBA [PDF], last week’s blog on credit card surcharging received plenty of feedback which helps add your voice to our campaign. The airlines seemed to be the most common culprits, with $20-30 surcharge not uncommon even on relatively low-value domestic flights. Here are a few comments that sum up the feedback:

Trish said, “I was trying to book flights for my family (5) from Sun Coast to Sydney return. I use the direct deposit option so that I don't pay fees but this pmt method was not available. Jetstar wanted to charge $70 fee for paying by credit card! I cancelled the booking.”

Alex said, “I can understand why merchants impose a few when I use a credit card, as they then have to bear the transaction cost that the credit card company imposes. But AFAIK these are between 0.5% and 1%, so why some charge so much more, I can't understand.”

Jo said, “Recently booked 3 return airfares from Melb to Hobart (4 counting baby). Virgin site was faulty so had to book by phone (by which time cheaper fares had gone, costing me $150 in lost savings). Was then slugged a $24.46 CC surcharge despite fact that there is no alternative to using CC when phone booking. Bit rich? I thought so.”


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