The Telecom Regulatory Authority of India has issued a directive which makes it necessary for certain Mobile Value Added Services to be billed only on the explicit consent of the customer. The customer will have to provide her consent by either calling a specified number, sending an SMS to a particular number, an interactive session to a specified number or a request in writing, fax or email.

This is applicable to services which are offered through pressing certain keys on the mobile handset – including the Press Star (*) To Copy and services initiated by outbound dialer calls.

Implications

Press Star (*) To Copy is a service that OnMobile Global showcased as one of it’s key innovations on the consumer front – it made it easier for consumers to subscribe to ringback tones by just pressing the * key. Similarly, outbound dialers activate certain services by asking consumers to press a specified key or a combination of keys. Subscription to VAS services is an impulse decision, and a formal consent like the one mandated by the TRAI will take the “impulse” out of the purchase. One can expect subscriptions to VAS services via Outbound Dialers and to Press (*) To Copy to decline. One VAS industry executive suggested to us that this is going to impact rural subscriptions the most, since the new subscription format is complicated.

Download the directive here.

Alternatives

Vijay Shekhar Sharma, MD of One97 Communications has written on their company blog that he doesn’t think outbound dialers and Press Star (*) To Copy are sources for customer dissatisfaction. He suggests that methods like double confirmation, periodic communication to the customer of method of unsubscription, pro-active confirmation, and providing a single page for unsubcription are alternatives. Other VAS company heads haven’t written about this development, and we would appreciate their take on it.

Question is – when there are other alternatives, why has TRAI imposed these restrictions?

Basis For This Directive: Just Or Unjust?

 

(Preethi adds) There are language issues: Take the example of a housemaid working in Chennai who has a prepaid connection. She has been having trouble removing the ring back tone on her mobile which her son  subscribed to by hitting a button by mistake. She has been struggling to cancel the ring back tone, and has taken three weeks over it. The IVR is in English, which she doesn’t understand. On asking other mobile users, she learnt that she had to send an SMS with two very specific words, again in English. How can she unsubscribe? And with the new guidelines, how can she or someone like her subscribe to a service?

While it may appear that this directive is too harsh, and creates an impediment to the growth of VAS services in India, we do think that it is time for Telecom Operators and VAS companies to introspect: consumers face significant billing issues, having been charged for services that they haven’t been subscribed to, and often (despite what telecom operators say) the billing is not overturned.

Some issues that we’ve come across:

— Billing for content not purchased: I’ve written in the past about being billed for content that I haven’t purchased.
— Subscription to services without consent
— Customers not being unsubscribed despite request: a prominent mobile VAS company was recently barred by BSNL for failing to unsubscribe customers from their Mobile Radio service
— Unsubscribed from one service, but subscribed to another, without consumers consent (revenues from consumer remain the same).
— Off portal billing: this is the tricky one. While in Lucknow, our correspondent Preethi J had visited a handset manufacturers WAP portal, and clicked on an advertisement for a game. Without downloading or purchasing any content, she was charged Rs. 99 for the game…for just clicking on the banner. The game company question is among the largest in India. When tried the same from Delhi, I was taken to a confirmation page seeking my consent for the purchase. Question is – in an off portal situation, is the telecom operator accountable, or is it only the VAS company?

A Case For Licensing VAS In India?

Note that the issues that we’ve mentioned above have not been adequately addressed by the TRAI with this directive. An indication of the extent of widespread consumer dissatisfaction with VAS billing is a survey that the TRAI has produced, according to which an average of 22 percent of the respondents across the country said that they were charged for mobile value added services without their consent. Take a look at the survey results here.

We don’t mean to sermonise – and this may not go down well with many of our readers – but one has to look at whether practices followed for meeting short term targets are going to impact long term growth of the VAS industry. A few disgruntled consumers who won’t ever buy again may impact revenues, but someone down the line in order to protect mobile consumers, the government, the courts or the regulator are going to step in; there is a strong argument in favour of licensing VAS in India, if only to make companies more accountable and regulated, particularly in an off-portal situation.

Related:

TRAI Directive On Mobile Content Subscriptions
— TRAI Fails To Deliver On Mobile VAS Promise: Drops Key Provisions