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Telco investigation uncovers systemic shortfalls with poor sales practices and hidden costs for consumers

Karen Tan
Karen Tan
17 May 2021 1 minute readShare
Telco investigation

The Telecommunications Industry Ombudsman has just released its latest systemic investigation report into the telco industry, and the key findings show consumers are often unclear on what they are signing up for.

The report, titled Helping telco consumers sign up to the right phone and internet products, found key deficiencies in the way some providers tried to sell the best products for consumers, often leaving customers confused and with the wrong products or services.

Poor sales practices, hidden costs and unclear information are among the key areas of concern, after five investigations were conducted for review.

TIO Judi Jones confirmed consumers do not always understand what they are buying and this can lead to problems, for both providers and consumers.

“Phone and internet products and services are essential to our daily lives. Telcos must advertise products accurately and make clear information available about what they are offering,” the ombudsman said.

“Telcos are offering a vast range of innovative products and services to keep Australians connected and it can be difficult for consumers to keep up”.

The report found advertising and point-of-sale information for telco products and services does not always cover key terms, and online information can be difficult to find and understand.

Telcos do not always promote or sell their goods and services responsibly, and consumers can unknowingly sign up for products or services they do not need.

In one example, the TIO got nearly 100 complaints about a telco’s sales practice during a promotion. After the TIO investigated the issue, the telco was aware the problem was widespread and credited a total of more than $1.4 million to over 10,000 affected consumers.

While the telcos under review for the report have since improved their selling practices (including updating advertising and more training for sales staff), Ms Jones warned consumers to be aware of the pitfalls.

“If you are signing up to a new product or service, don’t feel pressured to sign up on the spot. If something is advertised as ‘free’ or ‘included’ check if there are any conditions,” she said.

“Get clear information on costs and inclusions before you decide if the product is right for you”.

Consumers are also encouraged to talk to the telco if you signed up for something you didn’t expect to discuss possible options, including payments or to be released from contracts, where appropriate.

Telco investigation uncovers systemic shortfalls with poor sales practices and hidden costs for consumers
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Karen Tan
Karen Tan

Maja Garaca Djurdjevic is the editor of My Business. 

Maja has a decade-long career in journalism across finance, business and politics. Now a well-versed reporter in the SME and accounting arena, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies and enabling citizens to influence decision-making.

You can email Maja on [email protected] 

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