Cashback complaints have fallen, says Ofcom

Ofcom has published a new report called The Consumer Experience 2008, which reveals that complaints about mobile phone cashback deals have fallen from a peak of more than 600 per month in September 2007 to fewer than 70 per month in September 2008. It's also revealed that more consumers are contacting Ofcom about fixed line mis-selling and silent calls than any other telecoms issue. In addition, Ofcom revealed that consumers are increasingly aware of the number of different fixed line and mobile suppliers. 62% of consumers are aware of three or more fixed line suppliers and 89% are aware of three or more mobile providers (compared to 55% and 85% in 2007). That means 11% of people aren't aware of all five UK mobile networks. [Press release]

Cashback dealer declared insolvent

First Contact Mobiles, which was based in Leeds but did most of its business online,has been wound up in the High Court following an investigation by the Companies Investigation Branch of the Insolvency Service. The company encouraged customers to connect mobile phones by promising 'cashback' deals but failed to pay. It also failed to keep records of the amounts involved, which could exceed £250,000. [Press release]

Ofcom cashback rules could hit dealers

Ofcom's new rules to protect consumers from mis-selling and failed cashback providers are likely to hit smaller dealers, according to the UK's mobile networks. The proposed rules, known as General Condition 23, were announced in March and are due to be implemented this summer. Networks will be liable for the practices of third parties and can be penalised up to 10% of their annual turnover for failures. Last week 3 said the new rules would cost it in the region of £1 million, forcing it to cut its dealer channel, with T-Mobile adding that the costs involved would be “extremely high and disproportionate". Ofcom is currently looking at all responses to its proposal and is expected to publish a further statement in July 2008. [Sources: Mobile News; Ofcom PDF]

Vodafone drops Dextra

Vodafone has stopped using distributor Dextra for any consumer airtime contract connections. The volume of Dextra's consumer connections on Vodafone has dropped dramatically this year, largely since Dial a Mobile (Mobile Connections) and Mobile Media Systems collapsed following problems with their cashback deals. [Source: Mobile News]

Ofcom proposes clampdown on mobile mis-selling

Ofcom is proposing a change to the law surrounding mis-selling mobile phone services. Its proposal covers customers being given incorrect information, 'slamming' (where consumers are committed to a new contract without their consent) and cashback schemes.

The new rules will require mobile service providers:

• not to engage in dishonest, misleading or deceptive conduct and to ensure that those selling their products and services do not mis-sell;
• to make sure the customer is authorised to, and intends to, enter into a contract;
• to make sure customers get the information they need when they buy the product;
• to ensure that the terms and conditions of all sales incentives offered by their retailers are not unreasonable; and
• to carry out due diligence and checks to ensure the soundness of their retailers.

Ofcom says these new rules - if implemented - will let them formally investigate complaints and impose sanctions for breaches of the regulations. They'd like feedback on their proposal by 29 April 2008.

New edition of 'The Fonecast' now online

This week's podcast of The Fonecast, a free weekly downloadable broadcast about the mobile industry (in partnership with Mobile News), is now available to download from TheFonecast.com. We talk to Paul Withers, the News Editor of Fone!, about cashback and other issues affecting dealers. There's a quick review of the new Onyx Liscio - and we take our usual look at the latest industry news and gossip. Each broadcast can be downloaded by including us in your RSS reader, by using iTunes, by visiting TheFonecast.com or by visiting the Mobile News website.