Regulators

'Explicit consent' a must for premium cellphone services: Trai

MUMBAI: The days of cell phone companies foisting value added services "surreptitiously" on consumers could soon be over. The Telecom Regulatory Authority of India (Trai) today directed all mobile operators not to deliver allot chargeable value added services to consumers without their "explicit consent".

"Any value added service, which was earlier being provided free of charge, shall not be made chargeable without the explicit consent of the customer," the directive states.

 

Additionally, providers are required to "publish in all communications / advertisements relating to premium rate services, the pulse rate/ tariff for the service" they offer.

 

 

Explaining the reasoning behind the directive, a Trai release issued today states, "The Authority has observed that in the last few months, a number of operators and also some independent agencies are increasingly providing value added services like quiz, ringtones, televoting etc. through SMS. In most of these cases, the charges for theses services are more than the normal published tariffs. The customers are informed about these value added premium rate services through SMS, advertisements in newspaper or television. But in this communication, the cost implication of the service is not intimated. Sometimes the messages are only followed by wordings 'T&C apply'. This practice of service providers works against the interest of consumers."

The order is particularly relevant to television companies that have SMS as a key element of their shows that have high levels of interactivity. A recent example is that of Sony Entertainment Television's super successful reality-based musical talent hunt Indian Idol. All SMS "televotes" were charged at Rs 3 as against the normal tariff of Re 1.

And these are no small numbers that we're talking about. In two-and-half months, Rs 300 million in revenues is what Indian Idol reportedly generated just from mobile phone companies. Calculating a 75:25 revenue share in favour of Sony that's Rs 225 million that would have been raised through the mobile telephony platform.

The Trai order would also impact Star India, which has plans to raise interactivity (and the revenues that flow from it) to new heights for its 2005 blockbuster Kaun Banega Crorepati (KBC) II.

Of course, a point that needs mentioning here is that in the case of "high-involvement" shows like Idol and KBC, viewers are unlikely to have any qualms about paying premium rates for the SMSs they send in. Therefore it is just a matter of clearly informing them of the fact.

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