Cellular subscription services are fast becoming a headache for South African cellphone users, says Davin Mole, CEO of the Exact Mobile group. Advertisement promoting subscriptions services are misleading and once subscribed, Mole says, it can sometimes be difficult for users to find out which service they are subscribed to, or how to unsubscribe.
He says Exact Mobile’s help desk regularly receives complaints from users who have been subscribed to such a service.
“Users are caught by the subscription services because users are only notified in the fine print at the bottom of the advert that they are, in fact, joining a subscription service.
“However, most users don’t read the fine print and therefore think they are purchasing content on a case-by-case basis. When they see someone sending them content on a regular basis and billing them for it, they often send a complaint to our help desk, but Exact Mobile does not have any subscription services,” he says.
To try to combat the problem, Mole says, Exact Mobile filed a complaint with the Advertising Standards Authority (ASA) against cellular subscription services in general.
“However, the ASA said we were unable to lay a general complaint and had to pick a specific advert. We therefore filed a complaint against an advert by a subscription service called Jippii, run by iTouch,” he says.
The ASA on Friday ruled that the Jippii advertisement had to be withdrawn with immediate effect on the ground that it was misleading.
While the advert did say in the fine print that by sending an SMS to the premium SMS number the user was joining a subscription service, it gave the impression that content was downloaded one item at a time, and was therefore misleading, the ASA said.
“There are two general types of download services available: those where the consumer downloads and pays one item at a time, and those where the user pays a subscription.
“This material difference must be clearly and unambiguously conveyed in all sections of the relevant advertising material,” the ASA statement said.
Request to ban advertising
Mole says Exact Mobile will send the ruling to the cellular networks and the Wireless Application Service Provider Association (Waspa) and ask them to address the issue of cellular subscription services.
“While adverts like the Jippii advert are already illegal according to the Waspa code of conduct, Waspa is only accepting complaints from September 1 2005, which means advertising is unlikely to change before then.
“Waspa has said that from July 31 2005, any user who initiates to a subscription service must be sent an SMS notifying them that it is a subscription service,” Mole says.
“However, neither of these [rulings] takes into account the fact that users who have already unknowingly subscribed to subscription services will still be paying for it.
“We are therefore asking the cellular networks and Waspa to ban this type of advertising, have all such adverts withdrawn across all media forms immediately and force subscription services to unsubscribe all users. The companies could then notify users that their service is a subscription service and ask them whether they want to subscribe to it.”
Furthermore, Mole says Exact Mobile wants Waspa to force all subscription services to send a monthly reminder to all their users reminding them that they are subscribed and telling them how they can unsubscribe.
“That way, if users do not realise they have subscribed to a service, they have the option to get out of it,” he says.
International protests
The ASA ruling comes on the back of a wave of international protest against cellphone subscription services. Jamba, a Verisign-owned ringtone vendor, is under investigation in the United Kingdom, The Netherlands, Germany and the United States for its Crazy Frog ringtone, which is a reworking of Harold Faltermeyer’s Axel F.
Waspa is already aware of overseas developments. In a memorandum sent to all wireless application service providers notifying them about Jamba, Waspa chairperson Leon Pearlman reminded all providers that if they are aggregating content on behalf of third-party companies, the Waspa code of conduct makes them liable for the conduct of the third party.
“Accordingly, a local aggregator could be sanctioned by Waspa and the networks if they, or the third-party company, are in breach of the code,” Pearlman said
According to an article in The Register, the British premium-rate services regulator launched an investigation early this month into Jamster, the division of German-based company Jamba, for its Crazy Frog ringtone.
The ringtone was so popular in the UK that it beat Coldplay to number one on the British charts, where it stayed for three weeks. Users who thought they had bought the Crazy Frog ringtone at a price of £3 later found themselves subscribed to Jamster’s subscription service, which cost £3 per week.
The Crazy Frog campaign that flooded British television cost an estimated £10-million and Jamster made an estimated £14-million from the ringtone.
The Independent Committee for the Supervision of Standards of Telephone Information Services in the UK is investigating Jamster and its mobile service provider MBlox for selling hidden subscription services using the ringtone.
The company is also currently under investigation by the Dutch Advertising Standards Authority. The authority has received a number of complaints from users who say it has been difficult to unsubscribe from the subscription service, which in Europe costs â,¬1,20 per SMS. The Crazy Frog ringtone has been dubbed “the biggest plague in ringtones” in The Netherlands.
In Germany, an investigation has been initiated by the Kommission für Jugendmedienschutz, against Jamba, while in the US a lawsuit filed in San Diego last month accused Jamster of fraud and false advertising. The suite claims Jamster falsely advertised that users got a free ringtone though users were billed $1,99 plus the mobile operator’s delivery fee.
Stephen Whitford is a media consultant for Exact Mobile