Wednesday, 08 March 2017 23:43

ACCC hit with jump in complaints, inquiries about telecoms services Featured

By
Rod Sims, ACCC Chairman Rod Sims, ACCC Chairman

There were 2775 complaints and inquiries about telecommunications services to the ACCC in the 2015-2016 financial year, a rise of 9% over the previous year, with complaints about the NBN up 145%.

And, this year the telco sector will come under even greater scrutiny by the competition watchdog, with the Australian Competition and Consumer Commission revealing that the sector will be a key focus for 2017.

While flagging it will scrutinise the sector more, the commission revealed that consumer complaints to the industry ombudsman actually dropped during the 12 months from 2015 to 2016.

The report shows that the Telecommunications Industry Ombudsman received 112,518 complaints during the year, a drop of 9.6% on the previous year.

On a positive note, the commission says an overall fall in complaints in the telecoms sector over the last five years was largely due to the increased focus by industry on improving customer service, changes to telecommunications regulations and investments to improve mobile infrastructure.

The commission's report, released on Wednesday shows that prices for telecommunications services, which includes Internet, mobile and fixed line services, have fallen overall by 1.5%. Within this, prices for Internet services increased by 2.7% on average, but this was accompanied by growing data allowances in many plans.

In fact, this latest report from the ACCC reveals a steep rise in data usage driven by audio-visual entertainment, cloud services and increasingly content-rich websites and social media applications.

The report also shows that data download volumes over the 12 months increased by 52%, with fixed broadband plans trending towards very large or inlimited data quotas while average data inclusions on mobile plans increased by a third.

The average price paid for what the ACCC calls a “broad basket” of services fell by 1.5%, with reductions in mobile handset, voice and legacy Internet services – all this while average prices for NBN and wireless Internet services increased.

During that same period, retail service providers increasingly competed on data with bundled offers and entertainment inclusions, while over-the-top services further expanded the range of service options.

The commission said 44% of consumers now watch catch-up TV and 32% access an online subscription TV service.

On retail competition, the ACCC says prices paid for Internet services generally increased during the year, with the average real price paid for all types of Internet services increasing by 2.7%.

At the same time, Internet plan data inclusions increased considerably, the commission reports.

The report reveals that prices for digital subscriber line and cable services fell in real terms by 0.7% and 0.1% respectively, while data inclusions for these services increased by 32% and 19%  respectively.

And, prices paid for NBN and wireless services increased in real terms by 4.4% and 6.4% respectively.

Data-hungry consumers paid more to satisfy their demands, with data inclusions for services increasing significantly – up 75% for NBN services and a whopping 91% for wireless.

The commission says that while the increase in prices paid for Internet services goes against the recent downward trend in prices, the increase in data inclusions suggests that some consumers are “paying more to receive more”.

“For instance, the 6.4% price increase for wireless services reflects increased monthly bill payments for higher spending consumers. Alternatively, in the case of DSL and cable services, the modest price decreases and significant increases in data inclusions suggest that some consumers may be obtaining more while prices remain relatively static,” the report says.

“These reports show that many of the significant structural changes transforming the sector in 2015-16 are being driven by consumer demand,” ACCC chairman Rod Sims said.

“While some consumers may be paying more, they are also getting much more in terms of data allowances. Consumer demand for streaming services, cloud services, and increasingly content rich websites and social media applications is driving this growth in data consumption.”

“The rapid evolution of the sector is delivering access to higher quality communications networks and a greater range of services for consumers,” Sims said.

“Tellingly, retailers provide around four times the network capacity for each consumer on their NBN services than on Telstra’s ADSL network, enabling a better online experience for the more than forty percent of consumers watching television over their broadband connection, or accessing other data intensive applications.”

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Peter Dinham

Peter Dinham - retired in 2020. He is a veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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