By: Russ
The Opera Telecom ASBO …
I was astonished after reading Scott’s earlier take on the Opera Telecom adjudication. What happened certainly is shocking. As ICSTIS writes in its adjudication:
The Executive stated that this case involved a very serious breach of the Code. The harm caused to consumers was immense. A huge number of people had been affected, with some 18.6 million callers being charged for entering the Competition but having no chance of winning a prize. The sums of money involved were also gigantic: with the average cost of a call being well over £1, the revenue generated by callers with no hope of winning appears to have been in excess of £20 million. It was the worst case which ICSTIS had come across in terms of the numbers of consumers affected and the amount of money at stake.
Read the ICSTIS adjudication and you’ll see it was a pretty obvious scam… taking in money — loads of money — from viewers who had no chance of winning the prize on offer. And the damning internal email that was exposed: ‘[m]ake sure they never find out you are picking winners early!’
And the punishment? Not much. In addition to the fine, Opera was banned from running phone competitions for 12 months, but even that punishment was suspended if Opera undertakes a compliance programme.
What does it take to receive a permanent ban?
Sep 28th 2007
I do not think you are alone in thinking this Russ. I have been wondering for quite a while how companies such as Opera and WIN (Wireless Information Network) who have had 25 adjudications against them for ICSTIS code breaches in the last 33 months (haven’t quite made that one a month ratio yet) with their fines now totalling £219,000, seem to keep getting their wrists slapped but with no further action - or at least without any real action that effects their ability to make money. Seriously, what other industry could you be and be found to break their codes of practice almost every month for three years and still be allowed to be conducting business as usual?? Maybe now that ICSTIS is becoming at PRS service themselves with their new catchy name phonepay plus things will change … I’m not holding my breath.
Sep 28th 2007
I think the problem lies with the OFCOM/Icstis model of regulation and the resulting lack of consumer protection.
From the OFCOM case against GMTV. OFCOM appears to believe it’s the responsibility of the companies who supply the service to ensure the service is not fraudulent. GMTV may not have been aware of Opera’s non-compliant Icstis record but OFCOM should have been. They obviously had decided it was not their responsibility ensure the public were not being defrauded or ripped off in some way.
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Factors tending to increase the level of penalty:
9.18
The Committee believed that GMTV’s inadequate checks on Opera meant that it was negligent in failing to make itself aware of Opera’s record of noncompliance with the Icstis Code. Moreover, GMTV remained unaware of this until March 2006 when the BBC’s Watchdog programme highlighted the concerns of consumers regarding text messaging services managed by Opera. In the Committee’s view, this omission was substantially compounded by GMTV’s failure to review Opera’s management of GMTV’s competitions at
any point over such a lengthy period of time, resulting in its failure to detect the repeated breaches over nearly four years. Even when GMTV was made aware of Opera’s record of failing to comply with the Icstis Code, it relied solely on Opera’s own explanation for the many breaches. The Committee did not consider that GMTV’s conduct in this respect could be described as anything but grossly negligent.
page 22
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Ofcom refers to Opera’s noncompliance with the Icstis code concerning text messaging services.
Look at the Icstis/Opera adjudication from 13 September 2006:
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Background
Complaints were received regarding an unsolicited text message sent to their mobile phones, which charged them 50p for its receipt. It appeared that only customers on the Orange mobile network were targeted.
The message stated – ‘Update: Your services have been modified. Please turn the handset off, then back on, for any changes to take effect’.
Sanction
Opera Telecom were fined £30,000 and issued with a formal reprimand. In addition, access to the service was barred indefinitely as it could never be seen to be compliant.
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In whose interest was it to treat the above case as a consumer issue. Why didn’t Icstis refer the matter to the police for criminal investigation?
Sep 30th 2007
what´s the reasoning for having a separate regulator for premium rate telephone services. would it not be more economical for OFCOM to regulate them?