Citizens Advice challenges telcos lightweight compensation ideas

The Citizens Advice agency has lit a fuse underneath compensation plans from UK telcos, highlighting the proposed plans would leave consumers short.

Back in March, Ofcom proposed a compensation scheme which would force the telcos to pay out sums of cash to consumers which received poor service. The amounts of compensation were certainly not irrelevant, and could cause a notable dent in the accountants spreadsheets for a few providers who would not be considered top of the tables.

In this instance, poor service is classified as a delay to repairs following a loss of service, delays to getting a broadband service installed beyond the date the provider committed to, and missed appointments or those cancelled with less than 24 hours’ notice. In response to the numbers put forward by Ofcom, BT, Virgin Media and Sky teamed up to propose a voluntary scheme, in which the providers would be able to decide the circumstances in which consumers get compensation and how much.

That’s right, it isn’t a typo, your broadband provider would be able to decide whether your claim is valid and how much compensation you are entitled to. We’re not too sure what to make of such a ridiculous idea. How on earth can anyone be held accountable when said companies are deciding the rules and punishment? It’s almost like the trio don’t get the idea of a watchdog or consumer protection. The difference in opinion can be seen below:

“A watered down compensation scheme would short change customers by millions of pounds,” said Gillian Guy, CEO of Citizens Advice.

“Thousands of people each year seek our help when their provider fails to repair or set up their broadband. Some people are left without a working internet connection for weeks despite numerous calls to their provider or no-shows from engineers. Broadband is now an essential service, with households relying on it for everyday activities, so a lack of a working service can make day to day tasks much more difficult.”

Whether you like it or not, the internet and the digital economy are critical aspects of everyday life. Ofcom was quite right to propose such a scheme, as providers of such infrastructure need to be held accountable to proper service. The UK is already falling further and further behind the rest of the world when it comes to communications infrastructure, and considering the carrot approach seems to have largely failed, the government needs to start bringing out the stick.

The telcos are already strongly resisting the trend towards utilization, even though there are voices in the industry providing evidence the internet is becoming a commodity, and this resistance to rules is just giving the impression of a spoilt child. We don’t have to listen to the teacher because our parents told us we were special. It is another example of how un-customer-centric the telco space is becoming.

As with every review of this nature, the telcos have tried to complicate the matter to make it go away. It worked recently with BT’s challenge to Ofcom’s Dark Fibre ideas, and it would appear the same play is being used here. Essentially, the telcos are challenging basic definitions, as well as the theories behind the compensation calculations, to muddy the waters and create confusion. Nothing will be passed into law if there are discrepancies. Below is an example from BT’s letter to Ofcom.

“We believe there needs to be a clearer definition of total loss of broadband service than ‘unable to access the public internet’. For example, the broadband service may be running but packet loss may be so severe that in practice a consumer cannot get internet access. The definition must cover a comprehensive range of scenarios, and needs to be something that can be explained clearly to consumers as well as readily tested.”

It does seem quite reasonable to suggest such a complaint, but you have to look at the underlying cause; chaos and confusion. Create as many grey areas as possible and the rules will never get through. Of course, from the telcos perspective, they should be the ones setting the standards; they do know best after all.

Looking more specifically at the numbers, Citizens Advice claims 18% of 1000-analysed calls into its consumer service helpline would have qualified for compensation with their broadband issues. Of those that would have been eligible, 31% experienced a delay to repairs, 64% experienced delayed activation of their broadband and 5% experienced missed appointments. Under the industry scheme, consumers would receive £52 million less a year.

It’s funny how the telcos seem to be the champions of the consumer, but it’s us at home who seem to get the sharp end of the stick.

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