The telecommunications industry must raise its standards in its treatment of consumers or risk increased Australian Competition and Consumer Commission scrutiny and action, ACCC Chairman, Mr Graeme Samuel, has warned.
"Problems such as misleading advertising, unfair contracts and deceptive mobile phone competitions have been allowed to proliferate by service providers, publishers and carriers, who have turned a blind eye while taking a slice of the profits.
"It is no longer acceptable for carriers to wash their hands of responsibility as operators use their networks to entrap phone company customers with unwanted, expensive and difficult to unwind subscription services."
Addressing the Australian Telecommunications Users Group annual conference, Mr Samuel said the ACCC expects carriers to adopt rigorous standards and procedures which in plain language means closing off access to their mobile networks for rogue operators.
"If all carriers do not exhibit a responsible attitude to closing down rogue operators, they must expect the ACCC to pursue remedies available to it under the Trade Practices Act.
"Consumer protection issues in telecommunications consistently ranked number one as the sectors most complained about to the ACCC Infocentre, with more than 4,000 complaints a year."
Consumer complaints to the ACCC ranged over a number of types of operators, conduct and telecommunications products and services.
"The provision of telecommunications services is so important to society and the Australian economy, consumers should be able to trust their providers, receive high quality customer service and be accurately informed about products and services," Mr Samuel said.
"At the forefront of the ACCC's consumer actions are: mobile premium services, phone cards, broadband advertising, and inclusions in bundled packages."
The ACCC consistently received complaints about mobile premium services, primarily related to unsolicited services and billing, with about half alleging consumers had received premium services without agreement.
Other concerns included advertising practices; consumers not understanding contracts, including inadvertently signing up to a subscription service; and difficulties with unsubscribing and the complaints handling process.
"The ACCC is drawing a line in the sand – we're saying to the poor performers, and there are many of them, mend your ways."
Mr Samuel said that to address all the links in the mobile premium services chain, the ACCC had recently written to local mobile carriers outlining concerns in relation to the services.
A particular concern was the targeting of readers of youth magazines by mobile premium service providers. He warned the ACCC was prepared to take on publishers for running advertisements which they knew to be misleading or deceptive.
"Similarly, the ACCC is firmly of the view, that companies advertising plans as 'unlimited' should be very cautious when using such terms.
"To avoid misleading consumers, any qualifications to 'unlimited' calls or SMS messages must be clearly stated and not so significant that they negate the overall impression of the ad."
Phone cards were another product where costs or calculation of charges may not be fully disclosed.
He warned that lack of clarity in broadband advertising could easily mislead consumers about download speeds.
"The ACCC strongly encourages broadband providers to ensure that any broadband speed representations made by them are consistent with actual customer experience."
The ACCC also encouraged consumers to make sure they fully understood the terms and conditions of their contracts.
The speech will be available on the ACCC website.
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