ICSTIS has just made public its plans for how it is going to spend its 2004. It is clear from this that the ICSTIS Code is going to undergo a major revamp, but for more on this and the areas on which it will particularly focus.
Who: The Independent Committee for the Supervision of Standards Telephone Information Services ('ICSTIS')
When: September 2003
The premium rate telephone line watchdog the Independent Committee for the Supervision of Standards of Telephone Information Services ('ICSTIS') published its activity plan and budget for 2004.
The plan starts by pointing out that 2004 is the first year of new arrangements for the regulation of premium rate services and for new arrangements for consultation on and approval of the ICSTIS activity plan and budget. Under the Communications Act 2003, Ofcom, or Oftel acting on behalf of Ofcom, is required to satisfy itself that the premium rate phone line regulator, the rules and coverage of the regulation and the arrangements for this regulation are satisfactory. ICSTIS indicates that its key activities for 2004 will be focused in three areas:-
1. delivering a regulatory framework that is fit for its purpose;
2. delivering its core services to the public, to complainants and the industry to agreed and appropriate standards;
3. working with industry and other stakeholders to maximise compliance and give consumers information and understanding.
Not surprisingly, ICSTIS expects there to be continued growth in the use of premium rate charging in 2004. It has seen widespread comment on the rapid progress to mass market applications for mobile services offering visual content including services involving sexual entertainment and other services targeted at the youth market and often attractive to young children.
In broadcasting it is anticipated that there will be continued widespread use of premium rate on national and specialist channels, with digital and interactive TV continuing to increase in its penetration. Here it comments that while there is a generally high level of public trust in content promoted or delivered through television, this is changing with the lighter touch regulation of digital channels. Proactive targeted monitoring by ICSTIS may be appropriate with some new products. Currently TV-based services account for a quarter of the 200,000 – 250,000 calls to the ICSTIS Helpline. Other anticipated developments include broadband roll-out, digital radio and SMS and MMS to landline telephones.
In its 2002 activity report ICSTIS estimated that the premium rate market had risen to around £1b. Perhaps conservatively, ICSTIS now assumes a further 20% increase in premium rate activity in 2004. Amongst the areas ICSTIS anticipates focusing on in particular in 2004 are premium rate prize competition and award services. In this area there have been serious problems relating to unsolicited SMS promotions for many seriously misleading services. ICSTIS has already been approached by the Office of Fair Trading about some of these. In this context, action by statutory regulators such as the OFT will not be taken until they are satisfied that other 'established means' of regulation – in this case ICSTIS – have been tested.
Also in focus will be rules regarding services targeted at children. Mobile telephony and digital interactivity may raise legitimate reasons for change, the plan goes on, but ICSTIS comments ambiguously that it needs to understand and be informed by views on the maturity as well as the technical competence of children. Here and in other parts of the Code review process they will want to take account of initiatives elsewhere which may reduce the risk or level of consumer harm. Work on the rating and filtering of content to mobile phones is a case in point.
Other areas of the Code in likely need of review include those impacted by legislative measures including e-commence and data protection law.
ICSTIS also anticipates reviewing the form, value and usefulness of its guidelines to the Code. These should have clear purpose, must not contradict or confuse operation of the Code and should, critically, be of genuine help to service providers, networks and others in complying with ICSTIS' requirements. The clear implication here is that there may be significant changes.
Turning to the processing of complaints, ICSTIS anticipates that complaints received in 2003 will be 20,000 compared to 11,570 in 2002. However there has been a particularly significant increase in the volume of complaints in relation to a relatively static number of individual services. This reflects, ICSTIS comments, one recurring characteristic of the communications field – the ability to promote (and deliver) services on a national scale addressing millions of customers within days at very low marginal cost.
The new ICSTIS Code will take account of the forthcoming regulations on telecommunications data protection law, but it would be foolish, ICSTIS goes on, to assume that all of those who are currently using spam marketing and doing so in a seriously misleading way will cease their activities as a result of an EU directive. Problems with some categories of internet services seem likely to persist in the view of ICSTIS and it reports that ICSTIS equivalents in other parts of the world are introducing bars on some services or spend limits to deal with a problem which is universal to a greater or lesser extent.
In terms of targets for complaint handling, the current 'working assumption' is that ICSTIS will aim to complete 80% of cases within 12 weeks.
Many internet cases involve 'services' which have left customers cheated out of hundreds and even thousands of pounds as corrupt dialers linked to spam e-mails and pop-up boxes entrap unwary users.
By way of example, misleading services originating in the US, Germany and Spain were closed with fines totalling £125,000. ICSTIS can be dealing with spam and personal and intrusive messages sent to millions of handsets owned by children or with spam messaging by e-mail, fax and text which has the potential to dupe consumers out of hundreds of thousands of pounds over a few days. ICSTIS is also dealing at times with those who regime-shop around the world and work with network partners in the hope of running scams, possibly under different aliases. It deals also with those who deliberately target the unemployed and those not eligible for consumer credit by offering misleading services preying on their vulnerability. The ICSTIS Helpline continues to be regarded as a valuable resource for the public. Consideration has been given to outsourcing this, but as a core activity it was not felt appropriate to contract it out.
Why this matters:
ICSTIS correctly indicates that this is a time of opportunity for premium rate services. However there remain those intent on deception and those who are irresponsible or reckless (if not wilful) in the services they operate. There is still a genuine risk to the payment mechanism, ICSTIS comments darkly, if these issues are not addressed, if consumers are put at risk and if the regulatory needs and circumstances of those businesses, charities, public bodies and others who use this payment tool are not understood. By bringing clarity over how arrangements interact and by acting strategically to prevent gaps and overlaps, ICSTIS says it can take consumer trust and the commercial consequences of consumer trust to a higher level.
Marketinglaw wishes it well in its challenging task.