Trust down, poor selling practices up in new telco industry data
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The peak communications consumer group ACCAN has done new national research that shows trust in Australia’s telecommunications sector is still falling. Consumers are still reporting bad sales practices at an alarmingly high level.
The results come before last week’s Optus outage, which left more than 600 people in three states without access to Triple Zero emergency services. They come from the second round of ACCAN’s Consumer Sentiment Tracker, a new research project that looks at the real-life experiences of Australian communications customers.
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Among the early results:
43% of consumers do not trust their mobile or home internet provider to act in their best interest.
47% do not trust their provider to recommend the best plan to suit their needs, rather than the most expensive.
48% do not trust their provider to work to keep costs low.
The Tracker also found worrying evidence that poor sales practices remain entrenched across the industry. For example, in mobile services:
21% of consumers said they felt pressured to purchase a more expensive contract than they wanted.
30% reported that the coverage they receive is different to what they were told.
42% experienced unexpected changes to their contract.
ACCAN chief executive Carol Bennett said the results paint a concerning picture of an industry that needs to repair consumer trust.
“These figures will come as no surprise to many Australians who have experienced pushy sales tactics, bill shock, or services that don’t deliver what was promised. This is not how trust is built.”
“Trust stems from a customer-first culture, and in fairness some telcos do this very well - but most have a long way to go. Trust can also be driven by rules that give people certainty, strong protections when things go wrong, and meaningful consequences for poor behaviour.”
ACCAN says the new research strengthens the case for urgent reform of the Telecommunications Act 1997 and an end to the era of industry self-regulation.
“For too long, consumers have received vital ‘protections’ through a weak industry-drafted Telecommunications Consumer Protection Code,” Ms Bennett said.
“The data demonstrates that customers are feeling pressure to purchase pricey and unnecessary products, which is no surprise given that sales practices are self-regulated under the industry code.”
Today the Federal Court has handed down a $100 million fine for Optus after it engaged in ‘unconscionable conduct’ in sales practices that harmed more than 400 customers.
“The Federal Court today found that Optus senior management knew, or ought to have known, about the systemic failures that enabled this conduct. This cannot continue,” Ms Bennett said.
“Despite today’s action, over the last 6 months we found that 22% of people across the two waves of our Tracker have felt pressured to purchase a more expensive contract than they wanted. This post-dates the action taken by the ACCC against Optus.”
“Today a punishment has been handed out, but this data indicates that harmful practices are still ongoing. This will not change until sales practices are properly regulated.”
“Fundamentally, the Telecommunications Act must be brought out of 1997 and reformed to put the interests of telco customers before the profits of the telco industry. The Act still ‘promotes the greatest practicable use of industry self‑regulation’ - an approach which has failed consumers time and time again,” Ms Bennett concluded.
More about the Consumer Sentiment Tracker
The Consumer Sentiment Tracker forms part of a broader suite of ACCAN research providing insights into the experiences, expectations, and concerns of Australian consumers. This evidence base will be regularly updated and guide ACCAN’s policy work, consumer campaigns, and engagement with government and regulators. The full results from the second tranche will be available soon.
Link: https://www.accan.org.au/research/consumer-sentiment-tracker
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