Pay TV service providers urged to curb soaring consumer complaints- CHOICE # 367

The Consumer Council has expressed concerns over the soaring rate of consumer complaints against Pay TV service providers on contractual matters and sales practice over the years.

A steep rise in complaints was recorded in 2004 when it rose three times as many from 320 cases in 2003 to 1,010 cases. In 2005, it went up to 2,200 cases, and in 2006, to 2,909 cases.

In the first three months of this year, the Council received 867 complaints representing an 18% rise over the corresponding period last year (735 cases).

The rate of escalation may have slowed down but there is no sign in sight that the rising trend in consumer dissatisfaction with Pay TV service will soon be reversed.

Consumer complaints lodged with the Consumer Council revolved mainly around three areas:

First, no network coverage due to removal to a new address during contract period, but the service cannot be suspended.

Second, automatic renewal of contract without prior notification and prior consent of consumers.

Third, undesirable sales practices, for example, claims made by the salesmen on fees and charges, number of channels, service duration, etc. were at variance with those specified in the contract; or claims that without the subscription of Pay TV service consumers will not be able to view the present free-to-air TV programmes when it is changed to high definition digital terrestrial transmission.

To enhance the awareness of consumers to Pay TV services and fees and charges, the Consumer Council has conducted a survey on the existing four service providers.

In respect of removal to an address without network coverage, each of the service providers has its own different policies, including to change to the use of another type of transmission; to transfer their accounts to friends; to pay in one-off for the rest of the contract months outstanding; or to make appropriate arrangements depending on the situation.

Other highlights of the survey:

• There are two charging models for monthly service fees. The basic service package which is a monthly fee for access to tens of channels. And the a la carte service which one can choose and pay for only the channels needed, probably a more flexible and value-for-money choice for consumers who only need a few channels.
• Monthly fees for packages with a given contract period could vary from $148 (12-month contract with 38 channels) to $359 (18-month contract with up to 84 channels).
• There may be other fees and charges such as installation ($0 - $600), removal ($150 - $600), deposit ($0 - $1,200), monthly rental for decoder ($0 - $120).
• The total number of channels offered by the service providers can range from 42 to over 130!
• The contract period is usually from 12 to 24 months, and early termination usually involves a one-off payment equal at least to the sum of all monthly fees outstanding for the remaining period of the contract.
• Two of the four service providers offer plans requiring no fixed period for the contract; but, for the freedom, such plans are 34% to 104% more expensive.
• Notification not to renew the contract is 30 days or one month.

In light of the continuous spate of complaints against Pay TV service providers, the Consumer Council has put forward these suggestions to the operators.

First, explain details of the terms and conditions in the contract and ensure the consumers understand them before signing up.

Second, avoid signing up service agreements with consumers over the phone to avoid misunderstanding and unnecessary dispute.

Third, to provide packages that do not require consumers to sign up for a prolonged period. Or to provide packages with a shorter contract period, say 3 or 6 months.