premium rate pay per call telephone services » Europe News

Australian Premium Rate Phone Companies Fined $375,000

admin — Fri, 17 Jun 2011 15:17:57 +0000

Two Australian premium rate phone companies – Global One Mobile Entertainment and 6G – have both received fines totalling $375,000 for false and misleading advertisements for mobile premium rate telephone services.

These fines are part of a strategy by the Australian Competition and Consumer Commission (ACCC) to assist in addressing problems in the premium rate phone industry.

In addition to the penalties, the court has ordered both premium rate phone companies to implement a compliance program to “ensure a better understanding of their rights and obligations under the Competition and Consumer Act 2010″. The Federal Court in Sydney imposed the penalties after both premium rate phone companies misled consumers into thinking they could “purchase the mobile service at a one-off cost when in fact the consumer was actually requesting access to an ongoing premium rate mobile subscription,” according to a statement from the ACCC. Global One and 6G provide mobile premium phone services including ringtones, games and quizzes.

ACCC chairman, Graeme Samuel, said the matter was the latest in a string of nine successful ACCC outcomes against problematic conduct in the mobile premium rate phone industry.

“The market is changing and newer technologies may see the end of many of these services. Traders in mobile content looking to make a quick gain by misleading consumers will find themselves in court facing significant penalties,” Samuel said in a statement.

According to the ACCC, the two premium rate phone companies mislead consumers through four television advertisements broadcast on both free-to-air and pay TV. They were broadcast at times that would have attracted the younger viewer, the court found.

The subscription services promoted were through advertisements for: the One Time ringtone by Justin Bieber; entry to a quiz with a prize of $100,000; the Space Invaders mobile phone game; and The Doodle Jump mobile phone game.

In addition to imposing fines, the commission vows to continually review the MPS Code and monitor changes in the technology and their impact on consumers.

Both Global One and 6G said they will appeal the court’s decision.

Premium Rate Text Service Raises Funfs For Haiti

admin — Wed, 27 Jan 2010 12:47:18 +0000

Premium rate text messages are helping to raise funds for the victims of the Haiti disater.

More than $8 million (£4.9 million) of the total $35 million raised by Red Cross has been done via text message.

The charity said that it will help to provide kits with kitchen equipment, shelter and personal hygiene packs to help victims.

It added: “Please give what you can today to help thousands of people in desperate need of humanitarian assistance.”

Save The Children has said that premium rate text messages have brought on a new wave of donations, with its text service seeing many donations.

“Text messaging is helping to make the donation process more streamlined, so we can get aid to children and families more quickly,” said Anne-Marie Grey, vice president of resource development at the charity.

She added that the organisation expects the response to be bigger than the Indian Ocean tsunami’s public donation levels.

For more details on this appeal – visit – http://www.redcross.org.uk/

70% Of Ringtone Scam Websites Cleaned Following EU Investigation

admin — Tue, 17 Nov 2009 19:11:35 +0000

70% of websites investigated for mis-selling ringtones, wallpapers and other mobile phone services have been corrected or closed, following an 18 month EU consumer crackdown carried out by 27 Member States, Norway and Iceland. Since June 2008, when initial checks took place, 301 websites were investigated by national enforcement authorities for serious breaches of EU consumer law. 70% of the 301 cases investigated, have now been resolved. 52% (159 websites) have been corrected and 17% (54 websites) have closed.

The three main problems found were:

unclear pricing (for example, information was missing or incomplete);
failure to provide complete trader information;
and misleading advertising, in particular, advertising ringtones as “free” where the consumer is in fact tied into a paying subscription.

In Italy, in February and May enforcement authorities, as a result of the sweep, imposed large fines of around 2 million Euro on 9 major companies found to be in breach of the law.

EU Consumer Commissioner, Meglena Kuneva said: “This EU wide investigation was a direct response to hundreds of complaints coming in from parents and consumers from many different EU countries. Young people should not have to fall victim to scams like misleading advertising that lure them into ringtone subscriptions they thought were free. And parents should not find nasty surprises in their phone bill, when their children by accident have signed up to more than they have bargained for. These results show that EU wide enforcement co-operation can make a huge difference in cleaning up a market for consumers. This kind of joint enforcement action is where EU consumer policy will focus a lot of efforts in the future.”

Dr Paolo Saba, Director General of the Consumer Protection Directorate of the Italian Antitrust Authority said, ‘For the Italian Competition Authority, this enforcement initiative achieved important results in the interests of consumers making online and cross-border transactions. The results represent an important step towards more effective protection of European consumers and a more integrated European consumer protection policy.’

The Market
More than 495 million mobile phones are owned by Europeans. Ring-tones alone were estimated to make up 29% of the overall “mobile content” market in Europe in 2007 (about 10% higher than 2006). The value of European ring-tone sales in 2007 was estimated at €691 million.

Results of the 2008 Ringtone Sweep

Of the 301 sites investigated, 70% of problems have now been resolved, (159 have been corrected (52%), and 54 have closed (17%) (see table in MEMO/09/505 for figures per Member State).
Over half of these websites specifically targeted children (54%, 163 websites) using children’s cartoon characters, well known TV characters or required parental consent.
Many websites indicated multiple irregularities.(see MEMO/09/505 )

The 3 main problems found in the websites investigated were:

41% of all the websites checked had some irregularity related to the information about the offer’s price (124 websites out of 301). On many websites information about the price was incomplete or not referred to at all – until the consumer was invoiced via their phone bill. In particular, in the case of a subscription, the word subscription was not clearly mentioned or the period of a subscription was not clear.
75% of all the websites checked lacked some of the information required to contact the trader - the trader name, geographic address or the contact details were incomplete (225 websites out of 301). This is against EU law (the eCommerce and distance selling Directives (See MEMO/09/505 ) which require details of the service provider, including an email address, to be displayed.
35% of websites investigated presented the information in a misleading way (105 out of 301) Information on the contract was available on the site but hidden in small print or hard to find. In 28% of the misleading cases, services were advertised as “free”, but the customer was misled and later found that there were charges or that they were tied into a long term contract.

Italy Imposes Hefty Fines
In Italy (in February and May 2009), 9 companies which were found to be in breach of the rules during this Sweep, were fined to the tune of around 2 million €. The companies were Telecom Italia, Vodafone, Wind, Dada, Zed, H3G and Zeng, Fox Mobile and Tutto gratis. The Italian Antitrust Authority said that these companies had to be fined since the sites were not providing clear information (e.g. about the number of ringtones for the price mentioned or about their costs).

What Happens Next?
National authorities will continue to work to conclude the outstanding cases. The new system of EU wide sweep investigations will continue, with several other sweeps and joint actions planned for 2009-2010.