Ofcom opens investigation into sharp practices in the international calling card market


Have you ever used an international calling card? If you have, perhaps it was at a time when you didn’t have a fixed address, or were feeling the pinch? You probably saw the adverts that promised you cheap international calling and thought that they would be a great way to stay in touch with friends or family overseas in a cost-effective way.

If you did use an international calling card, what was your actual experience like?

Ofcom investigation and consumer experience report

Yesterday Ofcom launched an ‘own-initiative’ investigation into the UK international calling card market.  As well as opening the investigation it published a independent report into the consumer experience of using international calling cards. 

The report did not make pleasant reading, highlighting:

Availability and accessibility of terms and conditions

  • Very low availability and accessibility of terms and conditions at point of sale;
  • better on-line availability of terms and conditions, although in some cases still low accessibility; and
  • that the terms and conditions were ‘extremely complex’ and ‘difficult to interpret’.

Did the cards perform as advertised

  • Some of the cards did not perform as advertised;
  • in some cases a smaller number of minutes were provided than advertised;
  • a quarter of calls to fixed lines were subject to early disconnection, with an even higher proportion of mobile calls; and
  • 10% of newly purchased cards appeared to not work at all.

Benchmarking against alternatives

  • Calling cards in many cases were more expensive than other methods such as indirect access, although there was significant variation.

Customer service

  • Was accessible during office hours, but quality of information provided about tariffs, terms and conditions was variable.

The report concluded that “understanding which card will offer the best deal is almost impossible for consumers to determine.”

What next and comment

Having opened  the investigation, Ofcom’s next step will be to approach the companies in the market and ask for more information, whcih it will then use (together with its own research) to assess the extent to which the international calling card market participants are compliant with applicable consumer protection rules.  Whilst Ofcom (perish the thought that a statutory body might fetter its discretion) clearly has an open mind, the report seems to set up a definite ‘case to answer’ for at least some of the market participants. 

The more interesting question will be what happens in the market and whether the indirect access operators (there are a reasonable number) and/or the various MVNOs focussed on this market are able to use publicity about the Ofcom investigation as a means to increase their market share at the expense of the calling card participants.

About Rob Bratby

Telecommunications, media and technology lawyer advising companies across Europe and Asia
This entry was posted in Commercial activity, Fixed, Mobile, Regulatory action, Telecoms, UK and tagged , , , , , , , , . Bookmark the permalink.

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