Tan Hui Leng
huileng@mediacorp.com.sg

PERHAPS it has happened to you — you receive an SMS asking you to subscribe to a joke-a-day service, and you message back: “Who is this?”. The next thing you know, the subscription charges showed up on your mobile phone bill.  Such dubious practices should go out the window once a code of conduct compiled by the Infocomm Development Authority of Singapore (IDA) kicks in on Dec 16.

Ring tones, chat services and some 250 “premium rate” service providers will have to abide by this code which will — for one — lay out illustrations of what the IDA finds to be unacceptable advertising methods. This includes not using “Free” prominently in the headline and stating the applicable charges in fine print at the bottom of the advertisement.

All relevant charges should be prominently displayed. And customers must explicitly agree to a service before vendors can collect subscription fees. Billing operators, such as telecommunications companies, will also be regulated. They must ensure that the service providers’ names, the name of the service purchased and customer service hotline number appear in the bills. Furthermore, they must provide assistance in disputes and cannot demand payment before disputes are resolved. All three telcos contacted yesterday said they already do help customers resolve such disputes.

The Code of Practice for Provision of Premium Rate Services will be over and above the Telecom Competition Code. If found to be in breach, a service provider or billing network operator may be fined up to $1 million and have its licence suspended or revoked.

The IDA has already been regulating the industry but the fast-growing field needs more clarity for consumers and providers. In the cover note to the code, the IDA said that it had seen a significant increase in the number of consumer complaints in the last two years.

Since January last year, enforcement action has been taken against 24 vendors. In February last year, service provider mTouche sent unsolicited Chinese New Year greetings via SMS to 300,000 consumers and charged $1 for each message. It was fined $150,000 and suspended for six months. In another instance, Mobile365 was fined $20,000 for sending out unsolicited advertisements for a football quiz service via SMS.

Prior to finalising the code, the IDA had called for a public consultation in May. Primary concerns among premium service providers and billing network operators included excessive regulation and increased costs.

In its feedback on the IDA proposal, eFusion (which runs a mobile entertainment business unit) said that sending weekly reminders would incur business costs and thin the industry margin unnecessarily. Another content provider, i-WAP, said the proposed code tried to cover too great a scope. “Our impression is that the code tries to provide a contingency for every perceivable argument. It is like a taxi carrying 50 spare tyres to provide safety for a field day where the taxi could squeeze 50 passengers for a single trip,” it said.

However, the IDA said the code will enable best practices to be adopted in the industry. It has also clarified details in the final draft of the code. “By enhancing consumers’ confidence in using premium rate services, service providers benefit too because it will help to attract more users and the industry can continue to grow,” said the IDA’s deputy chief executive and director-general of telecoms, Mr Leong Keng Thai.

Posted on November 16th, 2007 by lbraum
Filed under: Singapore