With consumer complaints over premium rate SMS services and their marketing exponentially increasing, ICSTIS proposes new guidelines.
Topic: M-Commerce
Who: The Independent Committee for the Supervision of Standards of Telephone Information Services ("ICSTIS")
When: 11 December 2002
Where: London, SE1
What happened:
Premium rate telephony services regulator ICSTIS issued its proposed revised guidelines on premium rate short message services ("SMS"). The original guidelines came into effect on 20 May 2002. Since then, complaints about premium SMS services have increased five-fold, with particular concerns around the prevalence of unsolicited and inappropriate text message promotions. It was felt that two specific issues, amongst others, needed to be explored in some detail. These were the sending of unsolicited text messages and the ability of consumers to unsubscribe from these services.
What changes are proposed from the original guideline in May 2002?
The answer to this is not as easy as it may seem, since ICSTIS has seen fit to produce a new proposed version without highlighting the suggested changes from the original. An initial comparison of the two documents, however, reveals some of the changes. First of all the title has been altered from "Reverse-billed premium rate SMS" to plain "Premium rate SMS". This takes into account that the services looked at here are no longer exclusively reverse-billed (reverse billing is where content in the form of SMS is delivered to mobile telephone handsets for a charge, with consumers typically subscribing to the service and then being charged a premium for the messages that they receive, the charge being capped by ICSTIS at £1.50 per message). The new proposed guidelines also cover not only the operation of the services themselves, but also promotions advertising them. In addition, the proposed new guidelines will extend to "SMS mobile origination services". These are services where a premium rate is charged when consumers send text messages as opposed to when they receive one.
In the section dealing with cases where prior permission from ICSTIS is needed before a service can operate (these are "text chat" and contact/dating services) more chapter and verse is given as to what ICSTIS would consider to be an "instructional message". The significance of this is that ICSTIS would not expect a premium rate to be charged for the giving of "instructional messages". Services requesting details from consumers that do not constitute a substantive part of the service being offered should be treated as "instructional messages", for instance messages that are welcoming, explaining or providing general or specific information about a premium rate service to consumers, including any messages sent to consumers for age confirmation and exit from a service.
Also in respect of adult text chat and contact/dating services, ICSTIS proposes more stringent requirements as to age verification. It no longer considers it sufficient for a consumer to be asked to confirm that he or she is over the age of 18. The new proposal is that service providers must request a consumer's date of birth as proof of age.
In this context ICSTIS also asks for views as to whether it is being tough enough on service providers sending unsolicited text message promotions.
The other substantive proposed change to the guidelines relates to unsubscribing. ICSTIS reports that it continues to receive a steady stream of enquiries and complaints about the apparent lack of instruction as to how to exit a SMS service. In the light of this it is proposed that service providers should provide consumers with an instructional message, which they should be advised to keep, prior to the consumer engaging in the service in the first place. As a palliative, ICSTIS is proposing that details on how to unsubscribe no longer need to appear in promotional material for the services.
Why this matters:
In coming out with proposed changes to guidelines whose original version was only published seven months previously, ICSTIS has clearly felt an urgent need to update rapidly guidelines in an area where there has been a spectacular increase over the last year. As with all marketing communication growth areas, there is scope for abuse, and ICSTIS clearly wants to work with all parts of the industry to build consumer trust and confidence in these services.
There has to be some question, however, as to whether this process was best served in December 2002 by holding a conference to discuss the proposed new guidelines, and then only distributing the proposed new guidelines at the conference itself, with a consultation period expiring just five weeks later on 17 January 2003. Nevertheless, the plan remains to introduce the new guidelines in February 2003, and bearing in mind that ICSTIS has sharp teeth in terms of its ability to levy significant fines for breaches of its code/guidelines, all providers of these services should assume that the proposals will be adopted in their entirety and be taking steps to check their procedures accordingly.
