Telcos - get your act in gear

In the SMH on the weekend it was reported that the rest of the telco industry had declined an invitation to get together with David Thodey "in good faith to meet together to discuss the challenges and opportunities we face as an industry at a time of unprecedented change."

His colleagues decided to interpret the invitation entirely through the lens of "access seekers" and reject the discussion on the basis they want serious regulation, and this image is potentially reinforced by the fact that when others declined the head of Wholesale chose to interpret the act as indicating that his customers had no areas of concern.

However, Thodey was really returning to a proposition he advanced in his Comms Day Summit speech (though the speech is not on the Telstra speech site).

In that speech Thodey said;

If – as an industry – we want to get the policy settings right we must have a stronger voice. With that in mind, let me come back to the question of how our industry can play a wider role and be a catalyst for change and growth.
o If we accept that technology is changing the way we live and work …
o If we accept that – thanks to next generation networks and technologies – our industry is now at the heart of an increasingly digital nation …
o If we accept all that as a given what, as an industry, are we doing about it?

Are we – as a group – stepping up and taking a leadership position on matters of national importance?
o Do we speak with a united voice when it matters?
o Are we seriously tackling endemic issues – such as our industry’s reputation on customer service and accountability?
o Or are we still thinking like a peripheral – rather than a national – industry?

I believe we are not stepping up to this challenge well enough … The failure to use our social, economic and political capital means that we don’t receive the credit or the influence we deserve.

Ah well. At least he tried. He went on in the speech to say "One of the first areas where, as an industry, we need to start leading is customer service. Poor service undermines our public credibility." In this he is echoing the Minister who was quoted in the Sunday Age again putting the industry on notice, saying;

I sympathise with customers who have suffered poor service at the hands of the telecommunications companies. It is simply not good enough and now they are effectively on notice that if they don't improve their practices themselves, the government will step in to ensure consumers get quality customer service.

One could, of course, question whether the meeting needs to take place given that Communications Alliance exists as the voice of industry (though I can never win the argument that it is not a "peak" body, because peak bodies are made up of other bodies). It is rewarding to see that, after a period of decline, the seniority of the people who make up the CA Board is now mostly direct reports to Chief Executives. David to his credit helped us in a critical phase at AMTA by agreeing to serve on its Board after it too went through a brief period languishing under insufficient representation on the Board.

Perhaps Thodey's mistake was to not ask CA to facilitate the meal. It is a little known fact that we did try in meetings hosted by ACIFs (CAs predecessor) Anne Hurley between Phil Burgess, Paul Fletcher and myself (representing AAPT) in 2006 try to close the gap between Telstra and the G9 - an initiative I originally put to Phil in November 2005. However, Phil could never really bring any movement from Sol to the table, and Optus was always convinced everything from Telstra was a con (see Fletcher's book).

There is an old adage - if what you are doing isn't working try anything else. Thodey's idea is good as a "do anything else". If the direct invitation hasn't worked, then see if someone else can organise it.

Novae Meridianae Demetae Dexter delenda est

Ideas and Innovation

In the tail of the Government's National Digital Economy Strategy launch comes an ad for an Economist conference Information: Making sense of the deluge.

This is part of their series on the Ideas Economy. The conference is described as;

The world now contains unimaginably vast amounts of digital information, which is growing exponentially. The era of big data presents incredible opportunities—smarter cities, stronger companies, faster medicine—but just as many challenges. Storage is scarce, systems overloaded and governments and businesses know too much.

Managed well, data can be used to unlock new sources of economic value, provide fresh insights into science and hold governments to account. Managed poorly, it can cause great harm.

Ideas Economy: Information will tackle these issues and more. It will examine the data revolution from a range of perspectives, seeking solutions to big problems. The event will bring together theorists, strategists, and innovators who understand how to harness data to create value and advance individual, corporate, and social good.

There are two aspects of this conference that I particularly like.

The first is focussing on the Digital Economy as a problem not a promise....there are choices to be made here, not just a nirvana to be reached by peddling faster (I plan to write more on this shortly).

The second is that the conference looks like it is structured to have speakers and discussants - that is, there is real engagement with the ideas not just a blurting forth of positions. The Communications Alliance Broadband and Beyond series could benefit from this approach.

Anyhow, I'd like to know if ANY Australian is proposing to attend the conference in the US. If not, is anyone in my wider circle able to provide feedback.





Novae Meridianae Demetae Dexter delenda est

Facets of telco regulation

The CEO of ACCAN, Alan Asher, when discussing the status of telco regulation in Australia will at times note the lack of effective enforcement action by our regulators. Meanwhile Communications Alliance CEO Anne Hurley upset some of her members when in response to the Government consultation on Australian Consumer Law she suggested that the telco sector should only face one consumer regulator not two.

Today there is a report that one telco has admitted to the ACCC that its sales practices were likely to mislead customers, and that it had referred consumer debts to debt collection agencies while disputed over the "slamming" that had occurred.

The interesting point is that while these actions fall foul of the general prohibitions in the Trade Practices Act, they are each specificinstances of breaches of the relevant industry codes. In particular they are breaches of the Consumer Protection Code provisions on sales practices, complaint handling and credit management.

The question is why are the matters being dealt with by the ACCC under the general powers rather than the ACMA under the specific powers.

Meanwhile there are also a report of the ACMA prosecuting a telco over actions in breach of the Do Not Call register legislation when the same behaviour was dealt with under enforcement by the ACCC. Clearly in this case it is different aspects of the conduct being prosecuted - ringing the wrong people versus saying the wrong things.

Both cases involve a telco employing a selling agent, a case which always creates compliance challenges. In the latter case the telco claims it is being pursued over practices that it has fixed. It ultimately raises the question of how compliance programs should work and how much protection a firm should ge from them.

By their very natue sales activities are not directly supervised and "agents" (be they individuals within a sales organisation or a outsourced agency) can have incentives to "break the rules". As a consequence breaches are almost certain to occur - just as the law against fraud doesn't mean there isn't lots of fraud, or the law against theft doesn't stop lots of petty cash tins being light.

In those cases the enforcement action is usually brought directly on the contravening individual, but compliance with the TPA or telco codes is a responsibility of the principal not the agent.

It was in recognition of this fact that the ACCC played a leading role in the creation of an Australian Standard for compliance programs. The ACCC at least informally considers the approach to compliance in its decisions on whether to prosecute. I don't think the ACMA has developed as sophisticated a view. Certainly consumer advocates seem to be unaware of the distinction.

Ultimately the issue is how well you as a firm communicate the compliance message, train staff or agents on compliance and legal obligations, construct incentive schemes so that non-compliance can't be rewarded and finally manage the complaint process so that complaints that indicate non-compliance are aggressively used to identify "rogue" agents. It is unfortunately the latter that is most usually deficient with telcos all too often wanting to believe that the customer's claim of misleading conduct is just a cover for wanting to brake a contract.

Meanwhile in Europe regulators have taken decisve action on the latest source of mobile "bill shock" - high data roaming charges. Could Australia apply to be part of Europe for this?