How The New ACMA Rules Should End Mobile Bill Shock

From next February, mobile providers won't be able to easily charge you thousands of dollars extra if you exceed your monthly-cap. We explain how the new rules will help, and where you'll still need to help yourself.

Picture by Cory Doctorow

The Australian Communications and Media Authority (ACMA) yesterday released the final version of its Reconnecting the Customer report, and made six key recommendations for how phone companies should change their behaviour. If the industry doesn't implement those recommendations by next February, the regulations will be legislated.

In practical terms, mobile companies would much rather run their own system of regulation than have one completely imposed on them, so the odds are good that those rules will be incorporated into the Telecommunications Consumer Protection Code (TCP) before the February deadline.

The key changes that ACMA wants to see introduced include:

  • For all cap plans, the cost of making a two-minute call to another mobile (based on the highest possible cost), sending a text message and downloading 1MB of data need to be clearly stated. The provider should also state how many two-minute domestic mobile calls could be made on a typical plan. (If plans include a component that can be used for either calls or text, the number of two-minute calls that could be made if no text value was used should also be disclosed.) The aim here is to eliminate confusing "cap plan" pricing, which makes claims such as "$500 of calls for $50" but doesn't disclose what $500 of calls actually means or what you'll pay when that money runs out. Explaining that in terms of a number of 2-minute calls is a much clearer measure.
  • Basic terms of the contract -- including call rates, termination fees, contract lengths, and exclusions -- must be disclosed. Providers must also provide detailed information on cooling-off periods, customer service options and the fact that the Telecommunications Industry Ombudsman (TIO) can be contacted if there's a dispute that isn't resolved.
  • On cap plans, SMS alerts must be provided when customers get near their monthly spending limit (something we've already seen with Optus, for instance). A notification must be provided at 95% usage, and ACMA suggest warnings at 50% and 80% as well.
  • To stop telcos whining and saying "SMS notifications are too hard to develop", any company that doesn't have that system in place by February will be restricted to charging no more than half of a total monthly cap as excess fees. In other words, if you're on a $79 cap, the maximum extra charge that could be imposed would be $39.50 -- even if you used far more data. In practice, I expect every contract provider will develop a notification system precisely to avoid that scenario.
  • Publishing metrics which measure how quickly customer service issues are dealt with. We already see some of this data through the TIO, but that only deals with worst-case scenarios.

We're looking forward to seeing those changes happen, and we'll include some of that data in our Planhacker listings going forward. It's worth noting, though, that these changes don't reduce the need for customers to investigate their own needs carefully and choose appropriately. I also suspect that many of these details, while published, will still be in extremely small print. But having them there should still be a step forward. What do you think.

ACMA


Comments

    I think this is great. If you stop by a few of the public forums for tech people in Australia (Whirlpool comes to mind), there is thousands of stories of how telecommunication companies are screwing over customers.

    Stricter the better, keep it coming ACMA.

    I like the restriction of excess charges bit for companies that don't notify the customer.

    When I had my bill shock with 3 recently, I was told that their policy was not to tell people that something had been taken off of their account (in my case the data plan) because it would just annoy people. The word they used was "benefit".

    Basic communication should be mandatory. You'd think that would be something a telecommunication company could manage but instead they choose not to because it benefits them.

    Making it so that they can't benefit from it that much is a good step in the right direction.

    I seriously love the "if they don't do notifications they can only charge half the monthly cost". Twisting their arm.

      That actually might be more lucrative to the telco as a whole.

      What's better, 1% of your customer base going 200% over their cap level - in the process complaining to the TIO costing you money.

      Or 20% of your customer base going over their cap by 50%. I suspect this would generate them more GP on average.

      We all know it doesn't cost that much (marginal cost) to provide data, in-network calls, local & national calls etc. The only significant termination costs are off-net sms & mobile calls.

        But you essentially have an unlimited plan. Just purchase the cheapest plan, say $29 then you have unlimited everything for $43.50.

        I doubt telcos want everyone to just purchase their cheapest plan and go to town. It would make more expensive plans obsolete.

          exactly. hell if i only had to pay $40 id tether all my internet. Only have hd youtube, ect. probably be over 200g a month

    I love the capping of the 'cap' for non compliance, but it doesn't go far enough.

    They also need to look

    1) Have near real time data/call use via website.
    2) To allow international roaming calls but disallow international roaming data.

    I would ponder also once you use 100% web access should take you to a page that states it needs authorization to continue, calls should play recorded message informing and requesting authorization. Authorization would last rest of billing period. Though I imagine that would cause higher costs/diminished value in plans for the rest of us that don't go over to make up the revenue shortfall, so im not sure about that.

    It's amazing that they're crying poor about the notifications - I was in India using a prepaid SIM on a relatively ancient Nokia, and as soon as I completed my call (for roughly 1.5c/min charged at per-sec at that), I got an info message pop up and tell me exactly what my remaining balance was. If they can maintain that notification in India for every prepaid customer, why can't the Australian telcos get their act together?

    I have constant issues with virgin either chucking random usage on, not resetting my usage each billing cycle or various other things that I need to call up about constantly.
    2 day slow usage meters online doesn't help, plus the fact that any usage you use on the last day of your billing cycle they seem to put on both you current and previous bill with no clear cut off.

    "The cost of making a two-minute call to another mobile"

    There lies the problem, you don't always make calls to another mobile, sometimes you call landlines, sometimes you call 1300 numbers, sometimes you call 1800 numbers. They need the have CLEARLY stated the cost for calling these number as well if they differ. They also need to state if you will be charged for them or if those phone call will be included in any plan.

    Overall fairly weak sauce proposals. I'd like to have seen them go a LOT further.

    The idea of having excessive data charges orders of magnitudes above the original fee should be banned. Excluding some things from "caps" should be banned (ie, include everything or nothing). There should be REAL TIME availability of usage made to the bill payer, via websites or phone.

      Or even better, scrap this crazy different types of numbers cost different amounts rubbish, and move into the 21st century and make all calls cost the same amount (excluding international but including australia wide)

        I think the idea is to show a max cost per two minute session due to the fact that mobile to mobile would be the most likely and most expensive scenario for the average consumer.

        If they had to show every scenario would be more confusing that it is at the moment.

          Sorry to reply to your post by accident, but in reply to your comment as well if you look at Singapore for example it is the same cost for mobile and land line call.

          That's why on skype for example Singapore is one of the few countries that skype allows unlimited calls to mobiles for a flat fee.

    I am from the industry and really hated capped plans coming in, they took what was already a confusing area and made it far far worse.

    It should be in minutes full stop for the worst case scenario then discounts on top e.g. if the most expensive (non 1900 number) call is 50c per 30 seconds and you get 100 worth of calls they should have to advertise it as 100 minutes to any number and minutes to our home network are at 50% usage or similar. calls on top of this are charged at monthly fee/included minutes per minute.

    I think the Key they have missed is "REAL TIME availability of usage".

    Other countries (India, Brazil, etc) have this even for pre-paid that you can have a network notification (or SMS) with the summary of the call or Data session cost with your balance.

    The thing is, real-time usage information is available for prepaid customers on all networks right now. It can't be that hard to bring the same functionality to postpaid.

    Personally,

    As much as i hate to admit it, the American 'Minutes' style is much better than the system is set up:
    500 minutes talk time / 500 text, or something along those lines would be much more appropriate.
    That would drop call connection fees. You could add disclaimers stating that 1300/1800 numbers incur a 2x or 4x minute rating.

    Honestly this seems to be so much easier.

    with the SMS responses you would think that it would be amazingly easy, but hey thats just my 2c

    with the advent of smartphones, sms become obsolete anyway

    the only thing that i could see they gouging us consumer is with the data quota

    A cap should be just that,All internet usage should revert to dial up speed ,as has been done and is done presently but not by all,with all the modern technology we have today ,there is no way anyone should be paying more than their plan cap, either be warned or have your pH suspended until the next billing period,

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