Ofcom recognised that customers on contract plans were vulnerable to bill shock for a variety of reasons. It's own research suggests that 1.4 million people in the UK have experienced unexpectedly high phone bills, and came to the conclusion that the majority of cases could be avoided if providers just implemented a few simple measures.
The regulator identifies the main causes of bill shock as..
- Downloading data, primarily while travelling outside the EU, but also when using data in the UK (for example, customers using smartphones which may download data without the customer realising, or not realising how much data they are using);
- Using mobile voice services in the UK, mainly by exceeding inclusive allowances or calling numbers outside of allowances; and
- Lost or stolen phones ? where the number of consumers affected is low, but the level of financial harm can be substantial.
"Ofcom believes mobile providers can do more to help customers control the amount they spend on their mobile phones," the regulator said. It has suggested that providers develop and promote opt-in measures, such as tariffs, that allow consumers to set their own financial caps, and receive alerts when they are approaching those limits.
Ofcom is also engaging with providers on the issue of high bills resulting from stolen or lost phones. At present, if a consumer's phone is stolen and a huge bill is run up by a thief, the owner may be liable for the full amount. In cases, this has run into thousands of pounds. The regulator is discussing limiting the liability of the victims in such cases with providers.
Roaming outside the European Union has also been identified as a cause of large bills. Within the EU, regulation mandates that all mobile operators apply a cut-off limit once a costomer's mobile Internet bill hits ?50 (£42) in a month. Operators must also alert roaming customers when they reach 80 percent, and 100 percent, of their limit.
Ofcom supports the proposal by BEREC (European Communication Regulator) to extend those protections to European customers who are roaming outside the EU. The European Union is due to decide on new rules before the summer, with a view of them coming into effect by July. Until then, Ofcom is urging UK mobile operators to voluntarily introduce worldwide financial caps and alerts before any such European legislation is implemented.
Additionally, if the EU decides not to force operators to extend the existing measures worldwide, Ofcom will consider whether to consult on intervening to protect UK customers.
Written by: James Delahunty @ 2 Mar 2012 10:30
