From the horse’s mouth
Advertising Standards Authority (UK)
A situation that has affected British Internet-service customers, especially those who purchase DSL-based Internet service has been the ability for telcos and ISPs to conceal the line rental associated with a voice telephone service. The line-rental issue won’t be an issue with customers who run a cable-modem service with Virgin Media or run an FTTP service with the likes of Hyperoptic, Gigaclear or B4RN. It also included issues like the minimum duration of a telecommunications-service contract and the upfront costs that a customer had to pay to get a service going.
Now the Advertising Standards Authority has laid down new guidelines that come in to effect regarding the advertising of Internet services in relationship to the prices, contract duration and other issues. These guidelines will take effect from 31 October 2016, also when BT Openreach are to offer a naked DSL service for the UK market.
The ASA along with Ofcom conducted customer research regarding the pricing of broadband and telecommunications services in the UK. From this research, they highlighted the confusion customers were facing with things like hidden line rentals, introductory offers and upfront costs, along with the contract duration.
Now the ads and tariff listings that ISPs and telcos publish have to provide better information for their current or potential customers. This includes:
- the upfront and monthly costs for the service factoring, with the upfront costs to have greater prominence
- the length of the contract for services based on minimum-length contracts
- the prices that come in to effect after an introductory-offer period has lapsed
As far as minimum-length contract services are concerned, the industry and consumer-protection authorities need to work on a language that describes “month-by-month” services where a customer doesn’t face a long minimum contract period. This is more so with post-paid services where a customer can cease service at the end of the billing cycle which may benefit people who are in their location on a short-term basis like a long-term tourist or a person involved in project-based work. This is because of legal confusion about these services being marketed as “no-contract” services.
What is really meant to happen with the sale of fixed-line telephony in the UK is that customers can choose between different providers for this service and pay the line rental (typically between GBP£11-16) to the provider of their choice. This is thanks to the availability of the unbundled local loop setup available for their telephony services. It can be risky with smaller and boutique DSL operators who can’t bundle with particular line-rental provider but can be easier for larger ISPs who can bundle with a line-rental provider, typically their fixed-line telephony service.
The trends likely to come forth are quoted package prices increasing along with telcos and ISPs offering “first-few-months-free” offers or providing “gifts” or “rewards” like a tablet computer or a large number of points to a loyalty program rather than the “18 months free broadband” offers.
The Brits will also benefit from the arrival of a naked DSL service where you don’t have to pay line-rental for a voice telephony service. Such a service was offered by some ISPs in Australia and New Zealand; and over the Channel in France, Germany, Denmark and Portugal. These services will be described as an SOGEA naked VDSL service that is offered in FTTC service areas and will require a mobile telephone or VoIP telephony service to satisfy voice telephony service needs.
The questions that will always be raised is whether there is real infrastructure competition in the UK or whether BT Openreach needs to be fully separated from BT in order to provide increased value for money for competing retail ISPs and their customers.
At least this will mean that anyone who is considering Internet and telecommunications services or changing their Internet service in the UK can see how much the offer that is being advertised will hit them in the hip pocket.