Wednesday, 3 October 2012

Is your ISP telling the truth?

Jeremy Malcolm, co-author of CI’s new publication aiming to help consumer organisations campaign for better broadband, on why we need to take on the ISPs. 

 According to CI's global research on broadband conducted with 20 of our members last year, Internet service providers (ISPs) are keeping consumers in the dark when it comes to quality and value. 

To be more specific, they commonly misadvertise the Internet speeds they provide, with “up to” speeds being claimed that do not represent anything like the actual average speeds that users can expect to experience in practice.

Baffled by the figures

Consumers are also confused by download caps, fair usage policies and other terms and conditions that are disclosed only in the “small print” of their agreements with their ISPs, if at all. 

Even if a particular ISP provides all of this information in a fair and understandable manner, the consumer who is shopping around for a new broadband connection will need to be able to compare it with what other ISPs offer – but is $30 per month for an 8Gb ADSL plan with a 20Gb cap better or worse than 30c per day for a 3G plan with a 50Mb cap? The consumer is likely to have no idea.

Keeping consumers locked in

Moreover, once a consumer signs up to a contract with their ISP, the ISP will do everything within its power to stop them from leaving, by locking them in to a long-term contract. This is done in one of two ways:
  •  A broadband contract typically runs for between 18 months and 2 years - and often rolls over automatically to be extended even longer! In some cases, a “free” device or “free” installation is used as a sweetner. But many consumers, if offered the choice, would rather bear those up-front costs in exchange for the freedom to switch providers on a month's notice.
  •  Providers will often bundle several products together, sometimes for a “discount” rate. The consumer who is unhappy with one of the components of that bundle may find themselves stuck with it, because they do not wish to lose other bundled items. This too locks them in to a single provider, limiting choice and competition.

To help solve these problems – misstatement and confusion about the terms, conditions and capacities of Internet services, and the “locking in” of consumers to long-term commitments – CI has published Holding Broadband Providers to Account: A Consumer Advocacy Manual.

Campaigning for better broadband

The manual is designed to help de-tangle these issues for consumer organisations creating consumer-facing campaigns around broadband services.

Amongst the recommendations made in the manual is the promotion of a standard Broadband Disclosure Statement. This sets out the most important variables in a standardised, easily understood and comparable form, including speed, reliability, service limits and conditions, pricing and other information such as privacy policy. 

We have created Take a look at the sample Broadband Disclosure Statement illustrated here completed for a fictional ISP called iStall. 

CI's microsite contains a downloadable version of this form in several formats, along with an expanded version which adds additional measurements, and more detail of the conditions that apply to bundling of products, and consumer privacy.  You can use these as models for ISPs in your country to adopt voluntarily, or for regulators to specify as an industry standard.  

A second measure that our broadband manual recommends is the campaign theme, “Don't Lock Me In!”.  Consumers are best served by a competitive market for Internet services, and forcing consumers into long term contracts or to accept an inflexible bundle of products can distort that market, giving them a poorer deal.   

We recommend that consumer groups advocate for a maximum contract term of 12 months, and that the components of service bundles should be separable without significant financial penalty.

What can you do to help in the fight for fairer, more transparent and accessible broadband services for consumers?

No comments:

Post a Comment