VoIP Providers Not Meeting Obligations
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Independent telecommunications firm Telsyte, has hit out at slack IP Telephony providers saying Australian consumers are at risk.

A new report looking at the Australian Consumer VoIP market found that service providers are rushing to market without making the appropriate information available to consumers, are failing to meet their obligations under the Telecommunications Act and putting consumer VoIP users at risk of losing their service or money as a result.

Telsyte’s MD, Shara Evans, said the immaturity in the local consumer VoIP market, which numbers as many as 200,000 consumer VoIP subscribers meant that providers were not adhering to telecommunications regulation and industry guidelines.

This analysis of service provider contracts builds on work Telsyte published in its August report, ‘Consumer VoIP in Australia’, which looked at 25 providers. The new research presented at the ACIF VoIP forum covers more than 40 providers. The report found that 30 per cent of consumer VoIP service providers do not participate in mandatory Telecommunications Industry Ombudsman (TIO) registration. These organisations are in breach of the Telecommunications (Consumer Protection and Service Standards) Act 1999.

Only  44 per cent of service providers detail cancellation conditions in their contracts and seven service providers don’t even offer Terms and Conditions information at all.

In some cases transparency in the market has taken a backward step as the number of providers that explain their service guarantees has fallen by 20 per cent (from 62% in May 2005 to 42% in December).

Telsyte’s Evans said the results suggest consumer VoIP service providers are rushing to market without properly preparing their services. “The concern is that consumers are being misled by either false information or a lack of information from service providers,” said Evans. “For example, a growing number of providers do not clearly explain what will happen to the availability of emergency or 000 services in the case of a power failure or network outage.”

“Most alarming is that one third of providers have not undertaken mandatory registration with the TIO. Should consumers have a complaint about service delivery, this means they have no official avenue to pursue it through. Worse still, if they are pre-paid customers they risk losing their money,” Evans said.

“As the VoIP market continues to grow – 23 new providers launched between May and November bringing the total number to 43 – there will be increasing pressure to gain market share.”

“There needs to be closer scrutiny of providers’ adherence to telecommunications regulation and industry guidelines to ensure this growth is not to the detriment of consumers,” Evans said.

Anne Hurley, CEO, ACIF (Australian Communication Industry Forum) said: “Because some of the companies offering VoIP services are new to the telecommunications industry, they need to understand their obligations to keep customers properly informed. ACIF firmly believes that it is in the best interests of both providers
and consumers that everyone is aware of the issues and how to deal with them.

“Research such as Telsyte’s is providing an important service to the industry to help identify areas that need greater attention,” she said.