With the economy stalling, some customers are turning to the Telecommunications Industry Ombudsman (TIO) to escape their contract obligations to telcos and ISPs. Against that pressure, the TIO needs care to remain the independent dispute resolution organisation its charter requires.
Obviously in many situations the TIO does a great job at resolving disputes in a fair and equitable manner.
We have recently seen a spike in the number of telco and ISP clients seeking advice on TIO disputes. Sure, they are often to blame for poor communication and poor account management (which in our view is symptomatic amongst many industry players) but we also see disputes that are manufactured by customers attempting to avoid contract obligations.
Sometimes customers are just plain dishonest.
A case in point
One particular matter caught our attention recently. Our client – ISP ‘X’ - had a contract for a single DSL service to a corporate customer with annual turnover in the tens of millions of dollars.
The customer exceeded its monthly download quota and received several automated warnings both before and after going over the limit. Being a corporate they incurred several thousand dollars in excess charges.
When the matter ultimately reached the TIO, ISP X correctly asserted that it had acted reasonably and had complied with all Industry Codes and laws. On this basis ISP X refused to waive the all the charges, which is what this corporate customer wanted.
The TIO’s approach was ‘if you don’t give the customer what they want, we will continue to escalate the dispute to a higher level’, ultimately costing ISP X thousands of dollars in TIO fees.
It seemed to us that the TIO was doing everything within its power to give the customer the outcome it desired, even though neither the TIO nor the customer could identify a single breach of a law or Industry Code. Is this truly an ‘….independent alternative dispute resolution scheme for small business and residential consumers in Australia’ ?
This is just one instance where the TIO has departed from its ‘independent position’.
Solutions
Where a dispute is over a solid amount, a CSP could be best advised to issue normal court proceedings, locking the TIO out. It would be sad if an actual or perceived lack of fairness to the industry drove CSPs towards the courts as a better solution, but that could happen.
In other cases where larger sums were involved, after we issued legal proceedings and the customer became aware that the TIO had no power to intervene, the issue quickly resolved itself – with common sense and responsibility prevailing. Funny that.
Another solution is for ISPs and Telcos to properly account manage larger customers and keep the communication channels open. In many instances customers have unresolved disputes which, if properly handled, would not result in them looking for a solution by fair means or foul.
Probably most controversial, if the TIO imposed a filing fee (yes, we know there are some obstacles to that) with a sliding scale for individuals – small fees – and business – higher fees – with the usual dispensations for people who would suffer hardship from a fee, we might see fewer opporunistic complaints.
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You’re right on a legal/contractual front, no doubt. On the other hand, I applaud the TIO taking a stand generally against ridiculous, outlandish excess usage fees. They’re the bane of the Australian broadband customer.
Something doesn’t smell right about your example.
YOU SAY:
“Our client – ISP ‘X’ – had a contract for a single DSL service to a corporate customer with annual turnover in the tens of millions of dollars.”
THE TIO SAYS:
“The TIO investigates complaints by residential and small business users of telecommunications and Internet services” http://www.tio.com.au/policies/jurisdiction.htm
Care to elaborate?
As a person with a long term association with the Whirlpool website, you are held to a marginally higher regard than others and frankly, you should know better.
For you to ‘applaud’ the TIO for engaging in unconscionable, misleading and unlawful conduct is appalling. You are advocating an irrational, emotional and unlawful view which will ultimately only drive up the price of Internet services in Australia. Every investigation by the TIO increases the monthly subscription cost of Internet services, valid, invalid or otherwise. Ten level one TIO complaints costs more than 1Mbit/s of Internet transit.
Turning to the case in point, the customer signed up to a service for which they were charged. If the customer wanted a capped service, they could have purchased one. Most corporate customers aren’t going to survive well shaped on 64kbit/s.
Perhaps the corporate customer might review what their staff were doing on the Internet before turning to the ISP for a hand-out. Maybe they might review what their IT manager or other senior staff member did with those notification emails?
When you’re thousands of kilometers away from the USA, bandwidth costs money, big money. Accept it, move on or move to the USA.
And what did the TIO say when you brought to their attention that the complainant seemed to be a non-small business and therefore that the matter was outside their jurisdiction?
The TIO frequently use the tactic of escalation as a way of resolving complaints, the basic tenant of their argument being that if you as a CSP fail to resolve this (read “give the complainant what they want”) we will be “forced” (by whom?) to escalate this for further investigation and thus impose ever higher levels of revenue generating taxes – oops I mean investigation fees.
As no real investigation seems to happen at levels one or two, it seems to me that the system is designed to make matters go away or should the CSP in question have the temerity to hold its ground, impose punitive fees simply for performing very function that they (the TIO) were set up to facilitate in the first place. Has the faint whiff of extortion to me.
Still, they have to get the money to pay for their plush CBD accommodation and in office massages somehow!
In response to Jim R – the TIO was not interested. It is quite common to have the TIO ask the same question on multiple occasions as they have not read a letter sent to them!
Wiley, you are right on the money!
But in fairness to the TIO, I have seen many instances where they have done a great job and actually carefully examined the matter at hand. I suspect it is an issue about volume of complaints, that is why I think that my idea about imposing fees would get rid of the frivolous and vexatious complaints.
I had one referred this morning from a client – a customer has failed to pay invoices, and the client threatened a suspension (which their contract allows them to do) – the customer has said that if they exercise their contractual right to suspend then they will just lodge a TIO complaint and my ISP client will “have to lift the suspension”. The attitude amazes me….
“which their contract allows them to do”
And was the suspension handled pursuant to all relevant codes?
Good on the customer for knowing and understanding his or her rights.
In the case of ISP X, we received information from another source to substantiate the turn over of this business.
If you are referring to the appropriate notice required under the TCP Code, yes the proper notice was issued, and ISP X can suspend. This is not so much a case of the customer knowing their rights or evening having a legitimate basis to make these threats, but rather being opportunistic and abusing what the TIO is there for.