Telcos’ knuckles rapped

21 Apr 2004

ComReg has censured three telecoms operators for breaching a code of practice that covers advertising their services.

The telecoms regulator found that an Eircom telesales representative made misleading statements during the course of a call to the customer of a rival telco. Separately, Esat BT and Smart Telecom were also cited for the content of advertising campaigns which were found to be derogatory towards Eircom.

Complaints against Esat BT were understood to centre on a series of posters that ran in public places such as bus shelters. The text of these adverts referred to an alleged “ripoff” by Eircom.

In an ad that ran in the Irish Independent on 19 January, Smart had alleged “Eircom’s fixed line price hike is insane. Switch to Smart Telecom now and stop the madness”. The ad also showed a person in a straitjacket.

In its investigation following a complaint, ComReg said that categorising the charges for Eircom’s line rental service as being “insane” could lead consumers to believe Eircom was overcharging. “This is not based on fact since the charges for line rental are currently regulated prices as approved by ComReg from time to time. Therefore such a description is prejudicial to Eircom’s reputation and thus derogatory,” the regulator’s office said in a statement. “Smart Telecom are fully aware of the legal basis for the line rental charges.”

ComReg added that the statement also misleads consumers into thinking that by switching carriers to Smart Telecom they would no longer have to pay the fixed line rental to Eircom.

However, ComReg found that the tone of the text in the ad was not derogatory or misleading and was not in breach of the code of practice. “The information within the advertisement comparing minute call charges within Ireland between Eircom and Smart Telecom is accurate; the descriptions of Eircom’s call charges are advertising bluff and are not extreme and emotive.”

Commenting on the news, a spokesman for Smart Telecom claimed that the company had run the ad for one day and voluntarily removed it after that. Explaining the reason for running that particular text, he said it was born out of frustration that the company felt – and which it said was in the wider public domain over Eircom’s third line rental price increase in 12 months. “The fact remains that the Irish line rental charges are substantially ahead of the European average – close to 70pc,” he claimed.

He added that Smart was keen to co-operate with the regulator but he said that the ruling leaves us free to come up with ads that will inform consumers that we bring better value.”

It is understood that no specific action is being taken against any of the telcos but ComReg has confirmed it would monitor the incidence of breaches to assess whether the processes and controls to ensure compliance put in place by operators are effective. It is unclear as to whether fines will be levied against any of the firms. ComReg has not made an indication one way or the other except to say it would “take further action as necessary”.

By Gordon Smith