Friday, April 29, 2011

Open letter to "asmith"

Interesting responses to my itNews column.

The very first response I got was by way of a feedback e-mail (to itNews) from the man at Harvey Norman, Gary Wheelhose, that read;

Hi David
Just a quick note and thanks for the feedback re the presentation last week. It's always good for us to do those events as the feedback afterwards is so valuable. I use social personally for my own service issues - two recent ones with telcos and one with BMW - so I think i know what works for the customer too.
Enjoyed your article and thanks again!

The comments section on the website scored one from a customer who actually said his provider (one notorious for high TIO stats) was getting better.

This was followed by one from someone in the telco industry. I think the name "asmith" is anonymous but I'm not sure. If it is the author is probably in breach of his own company's media policy. It read

The author of this article knows full well that the numbers reported by the TIO are fictitious and the number of real actual complaints that have any investigation by the TIO is less than 20,000 per annum. Using these numbers to justify the position is a very shaky foundation.

This has been picked up by almost every submission regarding the TIO and ACMA inquiries and also by independent academic research.

Yet for reasons unbeknown to the public but well acquainted within the Telecommunications industry, Mr Havyatt continue to bag Telcos without supporting evidence or true cause.

The new CA code will make things worse for consumers. Amongst many other things, it proposes no service delivery during cooling off periods, etc.

Do you think people want to wait 21 days for their DSL service to be connected?

Come on David, there's two sides to this story, and you know it. The populist route of Telco bashing is wearing thin.

I've placed a long comment on the itNews site. What I want to address here is the accusation that there is some reason why I would want to "bag telcos" - and that that reason would be well known to people in the industry.

I can only think the reason suggested is that I feel I have been thwarted in my more recent career aspirations. This is not only offensive, but just like the comment itself comes from within a heavily filtered world.

I went to the trouble of including the CHOICE presentation, the comment from David Jaffe, and the history of "telespeak" to try to provide some basis for my comments. In my post here I added the link to the submission I made to the ACMA to try to more fully explain why the market alone isn't a solution.

In case "asmith" or anyone else from a telco is listening I'll add to that theoretical piece.

Consumers who are constrained from making the “rational” decision expected of them in theory because of a lack of necessary information are said to exhibit “bounded rationality”. In a recent theoretical work Bounded Rationality and Industrial Organisation, Ran Spiegler modelled a market in which firms were able to induce bounded rationality by “obfuscation”.

His conclusion was that increasing competition (by increasing the number of firms) either retained or increased (depending on other assumptions) the economic surplus retained by the firms. In the best case the firms were making an excess profit of half what a monopolist would obtain.

I really hope "asmith" takes up my offer on itNews and gets in touch with me. I don't think I am engaging in telco bashing - I think instead I'm identifying why the industry solution of "let us compete" is not a sufficient response to those who say "regulate".

Let's be clear I think direct regulation of customer service would be WORSE than what we have. But the industry needs to do something different.

Novae Meridianae Demetae Dexter delenda est

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