Consumer Authority fines ringtone providers
The Consumer Authority is fining Wizz Mobile and Holdvest Investments a total of EUR 76,000 for providing consumers with inadequate information when they offer so-called free ring tones. Consumers are attracted by captions such as 'free ring tone' and unwittingly sign up to a subscription they do not want. The Consumer Authority places the blame firmly on the companies for children and young people also being duped by banner adverts placed on websites such as spele.nl and clipjes.nl, which are aimed at children and youngsters. "The Consumer Authority has been set up to take action against these kinds of practices. By doing this, we want to send a signal to other providers that this really must stop now", says Marije Hulshof, director of the Consumer Authority.
Background to the decision
The Consumer Authority began this investigation following complaints from consumers who contacted the Information Hotline ConsuWijzer, which was set up by State Secretary Heemskerk, and following a worldwide campaign to find ring tone offers on the internet directed at youngsters. Wizz Mobile, also known under the name of Mobqo, advertised ring tones using banners on websites. The company also arranged subscriptions for ring tones and wallpapers via the internet by means of offers on its own websites mobqo.nl and 2game.nl but mainly on websites such as spele.nl and clipjes.nl. It emerged from the complaints that consumers unwillingly entered into a subscription, while under the impression that they had signed up for a free ring tone. Wizz Mobile used SMS messages to send out three ring tones a week to its customers, charging three Euro per ring tone. Another complaint was that it was difficult to end the subscription because it was not clear how this could be done and who should be contacted.
In order to protect the consumer, special information requirements apply to the process of offering services such as ring tone subscriptions via the internet. Under these requirements, it cannot be suggested that the consumer is ordering a free service while in reality he/she is tied in to a subscription. In addition, the company's identity must be clear and it must be explicit as to how they can be contacted. In addition to the fine, a penalty has been imposed on a daily basis to force the company to change the information they provide about when consumers enter into a subscription.
Earlier this year, a new code of conduct for SMS services was agreed between the companies involved under pressure from State Secretary for Economic Affairs Frank Heemskerk. The Consumer Authority will continue to closely monitor the providers and ensure that they comply with the rules. Tackling SMS services is a key area of attention for the Consumer Authority in 2008. Other investigations into providers of SMS services are still ongoing.