The TIO revealed the details of its latest systemic investigation report, released on Wednesday, showing that telco problems are costing small businesses unnecessary time and money, with the proportion of complaints from small businesses to the it steadily increasing since July 2016.
At the end of the last financial year that proportion was 14.7% with more than 19,000 complaints from small businesses about their phone and internet services.
According to the TIO’s report, many of these complaints were complex, difficult to resolve and had a significant impact on small businesses.
The investigation into the causes of the complaints found that small businesses may commit to products unsuitable for their needs, connecting new services can take longer than expected, providers and small businesses don’t always work well together when faults occur. and small businesses can suffer financial loss if they don’t have a back-up plan.
The report also reveals the financial impact of disrupted phone and internet services on some small businesses, showing that between September 2019 and March 2020, small businesses made approximately 1,100 complaints involving claims for business loss compensation.
The TIO says nine phone and Internet providers contributed to the investigation by offering their perspectives on the issues, and also shared examples of good industry practice and insights into the challenges in resolving small business complaints - with these providers representing 90% of complaints from small businesses in the last financial year.
Commenting on the report, Ombudsman Judi Jones said: “We carried out this investigation before the devastating bushfires and COVID-19 pandemic brought unprecedented challenges to so many small businesses.
“While the top complaint issues reported to us by small businesses are so far unchanged, the impact of these issues may very well be greater.
“The relationship between small businesses and their providers is vital to the businesses’ ongoing success. Any issues between a small business and their provider in the delivery of a service can have significant consequences.
“During government restrictions to curb the pandemic, many small businesses became solely reliant on phone and internet services to continue operating. As we begin the return to workplaces, our guidance around working together to fix faults and having a back-up plan may be crucial at this time.”
The TIO has made recommendations for small businesses and phone and internet providers, including:
- Work together to identify the business’s needs, consider suitable options, and focus on key relevant terms before an agreement is signed.
- Minimise the risks when connecting new services by checking the business address is correct, communicate expected connection timeframes or delays, and plan for enough connection time.
- Adopt a collaborative approach to fixing faults, and actively communicate with each other.
- Minimise financial loss by ensuring there is a back-up plan in place if phone or internet services are disrupted.
The TIO report into small business complaints drew comment from two key communications industry bodies - the Communications Alliance and the Australian Communications Consumer Action Network (ACCAN).
Communications Alliance CEO, John Stanton, said the TIO report into small business complaints provided useful insights into the ways in which small businesses and telco providers “need to work collaboratively to continue to reduce service issues and complaint volumes”.
“The report highlights what all parties can do to ensure small businesses get the best telco service possible, including a focus on ordering suitable communications services, providing accurate address details, managing faults and ensuring businesses have back-up plans in place,” Stanton said.
“The TIO has focused on the proportion of total complaints coming from small business, which is a reflection of the fact that complaints from residential customers fell even more rapidly last financial year (i.e. by 23.2%) than did complaints from small businesses.
“Telecommunications services are vital to small businesses, and falling complaint numbers show that the hard work industry has been doing to improve the customer experience has been having an impact.”
Stanton notes that as part of principles jointly agreed with the Federal Government, industry has also provided a range of benefits and initiatives to small businesses affected by COVID-19, in order to keep them connected, assist with financial hardship and provide options to help businesses successfully ‘hibernate’ until conditions allow them to re-open.
ACCAN CEO, Teresa Corbin said “a reliable phone and internet service is fundamental for most modern small businesses,” but “unfortunately, in the past few years we’ve seen the share of TIO complaints from small businesses continually increase.
Corbin said that one of the key takeaways for small businesses from the TIO report is the importance of having telco services that are fit for purpose.
“For example, if you’re looking at getting an NBN internet plan, make sure that you’re looking at business-grade plans that are designed with your needs in mind.”
Corbin said the TIO’s report also highlights communications issues between small business and retail service providers when fixing faults.
“It’s really important that telcos are communicating consistently and clearly with their small business customers when issues occur. Small business owners have to juggle countless tasks during the day, and don’t have the time to endlessly chase updates on faults," Corbin concluded.