IN YOUR CORNER
MTN gives customers no other option but to y’ell at it
The network is accused of forcing a service on someone unless they take steps to opt out
Cellphone network MTN has itself admitted to creating confusion with an SMS to customers that it would automatically renew users’ data bundles with a “1MG bundle” if the bundle runs out – that is, unless you proactively opt out.
Badly worded SMSes about that – applicable to prepaid subscribers from Thursday and postpaid contract ones from June 7 – did not go down well with many recipients.
“The idea of running out of data is so you can manage your account without going over a budget,” tweeted @albidenoon. “Now I have to follow up on all phones in this household.”
“Your SMS is as clear as mud,” tweeted Raymond Joseph. “What does this actually mean? What if I don’t want to auto-renew?”
MTN corporate affairs executive Jacqui O’Sullivan admitted the SMSes, including “Y’ello! From 7 June, when your data runs out, you will stay connected with MTN’s new auto-renew 1MB bundle at 40c”, were “not well considered”.
“They created confusion for which we apologise,” she said.
She insists MTN’s auto-renew policy complies with both Icasa regulations and the Consumer Protection Act, but the network stands accused of “negative option marketing” – forcing a service on someone unless they take steps to opt out – which has been outlawed for many years.
Among the MTN subscribers to take issue with what MTN calls “a solution”, is consumer goods and services ombud Magauta Mphahlele.
“Section 31 of the Consumer Protection Act does not allow a supplier to offer services or modify an existing agreement on the basis that the goods or services are to be supplied, or the agreement or modification will automatically come into existence, unless the consumer declines such offer or opts out.
“The option to opt out of the service also does not comply, as those who do not opt out will be automatically opted in and charged,” she said.
Responding, MTN said: “This is not negative option marketing – customers have received the appropriate notice that their terms and conditions will be amended.”
O’Sullivan argues the Icasa regulations allow operators to continue serving customers an out-of-bundle service, even if those customers have not chosen to opt in or out of out-of-bundle data, “as long as that data is being offered at an in-bundle rate”.
“This solution is meant to stop frustrating customers who are being cut off mid-session, but to still also keep the customers in control of their data usage.
“The solution also keeps customers connected at a lower rate than the out-of-bundle rate, as this is an ‘in-bundle’ price of 40c.
“Customers are being informed at 50%, 80% and 100% of their data usage so they know when they are running low. If they do not want to use any other option when their bundles expire, all that is required is they dial *135*6#, and they can opt out, and they will be barred until they inform us otherwise.”
From Thursday, O’Sullivan said, the menu would offer an opt-in and opt-out solution “so people can chop and change as their usage requires”.
It’s actually very “consumer-friendly”, O’Sullivan said. “The solution is being provided at a better rate and the standard OOB rate.”
Tech Central writer Andrew Fraser doesn’t agree, and offered an explanation for the new auto-renew “solution”.
“It seems that MTN has misused a small compromise that Icasa offered to the networks – that they could continue the session after the bundle was depleted, as long as they continued to charge in-bundle rates – in order to continue their previous method of billing for out-of-bundle data,” he said.
“Unfortunately it seems that Icasa failed to define what they meant by ‘in-bundle’ rates.
“Any reasonable person would expect those rates to be equivalent to the rates of the bundle that had just been depleted – for example, a 1GB bundle that sells for R150 has a per-megabyte price of 15c – but this is not explicitly defined, and MTN has decided that it could mean the price of ANY data bundle.
“So they’ve created a new bundle of 1MB at a price of 40c, and are going to implement this as the price for data that is automatically supplied after customers’ bundles are depleted.”
And on top of that, Fraser said, the network had decided that would happen automatically unless its customers specifically opted out.
“Not only is this rate 2.5 times higher than the 1GB bundle rate, it is also more expensive than the standard out-of-bundle rate for prepaid users that haven’t purchased a bundle.
“MTN has claimed that this is to avoid inconvenience to their customers, but it looks like another example of an unethical method to maximise revenue,” he said.