The premium-rate line regulator has published an “Information Services Compliance Update.” Its primary target is the use of search engine marketing to drive traffic to sites offering premium rate lines as a means of accessing public information services. Manana Shrimpling reports.
Topic: Online Advertising
Who: PhonepayPlus
Where: London
When: 13 March 2012
Law as stated at: 29 March 2012
What happened:
The regulator of premium rate telephone line operators in the UK, PhonepayPlus, has issued a Compliance Update for providers of premium rate information services which supply contact numbers of, or provide connection to, public information services ("PIS") or commercial enterprises.
PhoneypayPlus regulates premium rate services on behalf of Ofcom and has identified a number of practices (set out below) relating to the provision of PIS and commercial enterprise customer contact numbers which it considers are highly likely to be in breach of its Code of Practice (12th edition) ("Code").
The issue relates to use by the providers of search engine marketing ("SEM"), such as Google AdWords. Providers pay for keywords from search engines offering SEM, meaning that when a consumer enters keywords for the PIS they are looking for, the top returned searches in the "sponsored" links (which appear at the top of the results) are for premium rate services rather than PIS websites where the numbers are available.
The providers' webpages are sometimes presented in a way as to imply an association with the PIS that the consumer is looking to contact when in fact there is no such association. Consumers may also not be clearly provided with the price of the call, or other key information such as a link to the website of the PIS.
Upon calling the premium rate number, the consumer is provided with one of the following:
1. a recorded message of the number to call if they wish to directly contact the PIS – the consumer is billed a one-off charge for this;
2. a recorded message containing information which has been reproduced from the information provided by a PIS telephone number or website;
3. a direct connection to the PIS number – the consumer is charged at a premium rate for each minute of the call, which can lead to significant charges if the consumer is held in a queue;
4. a connection to a computerised or live operator who can either provide the PIS number directly, or connect the consumer to the PIS – this may involve a one-off charge on connection followed potentially by an on-going charge per minute.
PhonepayPlus found similar issues with premium rate providers using SEM to promote their websites offering commercial enterprise customer contact numbers. It considers that the relevant providers are likely to be in breach of the Code, in particular provisions that state that:
- premium rate services must not mislead or be likely to mislead in any way (paragraph 2.3.2); and
- premium rate services must not seek to take advantage of any vulnerable group or any vulnerability caused to consumers by their personal circumstances (paragraph 2.3.10) – this would be the case where a public information service attracts consumers in vulnerable circumstances, such as those needing to claim unemployment benefit, seek medical advice or apply for government crisis loans.
Why this matters:
PhonePayPlus has the power to impose fines on companies that breach its Code of Practice, to bar its services and even to bar the individual behind the company from running other services under a different company name. It has already taken action to ensure the removal of one such service while they conduct an investigation into the service and the provider.
Going forward, it is carrying out an urgent review of such services with a view to putting in place a systematic approach. It is considering a prior permissions regime to prevent the services from operating without its prior approval (on the basis of having met specified conditions), though will consult on its final proposals prior to implementing the regime.
In the meantime, providers of such services are encouraged to consider appropriate controls to ensure they are compliant with the Code, including ensuring that:
- the language used in the SEM copy accurately reflects that the service provider is a form of directory enquiry and does not mislead the consumer into thinking that a premium rate number is that of the actual service they are seeking;
- the layout and presentation of the information on the provider's webpage are distinct from that of the relevant PIS or commercial enterprise (including in terms of colour and typeface), and satisfy all obligations under the Code to clearly state that the cost of the premium rate number;
- the website states the actual public enquiry number (and cost) that the consumer is seeking, with a clear statement that this number can be used to contact the service directly at a lower cost. This number should be presented in a clear and prominent manner and proximate to the premium rate number advertised;
- where consumers are directly connected to a PIS or commercial contact number at a higher rate, they receive a clear and short phone message upon connection informing them of the price of the call per minute and the actual public enquiry number with the cost per minute of calling that number (together with all other relevant information); and
- services do not provide any facility enabling consumers to save a premium rate number obtained through the methods set out above to a handset or SIM card.
