Tighter rules on 'premium' SMS charges needed: consumer group

Mobile phone customers deserve better protection against text messages from marketers that cost wireless users up to $35 a month, says a consumer advocacy group.

The Union des consommateurs, a non-profit group based in Montreal, is preparing a submission that must be filed with Canada's telecommunications regulator by Monday as part of the group's request for strict rules concerning "premium" text messages, also known as premium SMS (short message service).

Such messages usually include quizzes, surveys, contests, jokes, horoscopes, sports scores and other content sent to people who have registered with websites such as Skill2thrill.com, wixawin.com or text4win.com.

'The system is not foolproof like they say.' — Anthony Hémond, Union des consommateurs

The consumer group argues that the CRTC already ensures customers are protected against paying for 1-900- pay-per-call voice services that they say they didn't sign up for.

"You can contest the amount in a reasonable way," Anthony Hémond, a telecommunications analyst with the group, told CBCNews.ca Friday. "We want the same conditions with [SMS premium text services]."

The group filed its original application in January after receiving about a dozen complaints from Quebec customers of Fido, Rogers, Telus, Koodoo, Bell and Vidéotron. It says the problem likely exists in other provinces as well, and the group hopes to hear from customers across Canada.

Customers charged up to $300

The customers said they were charged $16 to $35 a month — up to $200 to $300 in total — for premium text messages even though they:

• Don't remember signing up for them or
• Weren't clearly told they would cost them a certain amount per message — typically $2, but ranging from 50 cents to $5 or
• Were unable to stop the messages from being sent to them.

In order to receive premium messages, a customer usually has to sign up online and then confirm their subscription with a text message. 

One customer complained to the Union des consommateurs that they refused to pay the premium text message charges and had their service cut off by their wireless provider, the group alleges.

The group has asked the CRTC to:

• Require carriers to remove charges for premium text messages from their customers' bills while a complaint is investigated.
• Refer complaints to the Commissioner for Complaints for Telecommunications Services for investigation.
• Forbid wireless carriers from cutting off their customers' service because of a dispute over premium text message fees.

New rules unnecessary: wireless providers

Wireless service providers responding to the application said such rules aren't necessary.

"Most of what UC proposes has already been addressed and implemented voluntarily by wireless carriers," said Rogers.

Rogers acknowledged that one customer did inherit a subscription to a premium text message service from the person who had that phone number before when the number was "recycled prematurely" but said it has taken action to prevent similar situations from occurring in the future.

In general, disputes are dealt with quickly, refunds are provided in reasonable circumstances and customers can already request assistance from the CCTS, Rogers said. It noted that the consumer group cited relatively few complaints, and it's very rare for customers to receive unsolicited premium text messages because they must opt in twice.

Other wireless carriers, including Telus and Bell, made similar arguments.

Hémond disagreed that the companies' current procedures provide enough protection for consumers.

"It's not true. The system is not foolproof like they say," he said.

He acknowledged that the customers cited in the application had their complaints resolved but only because they contacted his group and were advised on what to do, such as filing complaints with the CCTS and CRTC. He wants to ensure all customers are protected.

He added that it is often difficult for the customer to contact the marketing company as they sign up through a website that often displays no contact information except an email address. He also questioned why cellphone companies should be allowed to act as collection agencies for those companies.

The Union des consommateurs 's counter-response is expected to be posted online on the CRTC website next week.

The CRTC is expected to make a decision in four to eight months, depending on whether it deems the case to be complex or not.