Mobile Entertainment

A few weeks ago ME focused on the problems associated with regional D2C content markets by highlighting the class action settlement against AT&T Wireless in the US for unauthorised charges from third party ringtone providers. It came in the context of rising complaints registered to the UK regulator PhonePayPlus (formerly ICSTIS).

Over the years, PhonePayPlus has levied more and more restrictions on how D2C service providers can reach users – and there could be more on the way. But at the same time many within the industry are pushing for more appropriate forms of self-regulation. These measures would allow the UK market to flourish once again, eliminating dodgy content providers by making them directly accountable to the regulators.

Under the current PhonePayPlus Code of Practice, primary liability rests with the service provider/aggregator rather than the content provider – even though it’s the latter that has control over the marketing of its services. As long as this situation remains, there is no incentive on the content provider to comply with the code. They can simply default on the fine, move to a different aggregator and leave the former UK aggregator to pay the fine, carry the bad debt and suffer reputation damage.

This is not effective regulation, it provides no consumer protection as the service continues and undermines the authority of the regulator. What criminal would worry about being in court if they knew their mate waiting outside would be the one serving the sentence?

Instead, the Association of Interactive Media and Entertainment (AIME) is advocating a content provider’s registration scheme, a review on the ban on third party databases, consistency in the implementation of PayforIt, and more action by publishers to refuse non-compliant advertising

Regulation should bite at the point of sale, not the technology intermediary. Such a scheme of registration could easily be developed to provide a Kite mark of credibility, which would be a guide to both consumers and service providers.

In addition, PhonePayPlus is advocating a total ban on the use of third party databases due to the inability, under Data Protection legislation, of obtaining informed consumer consent by way of pre-ticked consent boxes. In practice, it is difficult to envisage where informed consent can be properly achieved in regard to traded databases. AIME believes it would be fairer to the consumer to use databases where consumers have directly opted in – consumers could be sent a free marketing message providing the new service information and expressly seeking consumer consent to receive such content. If the consumer does not respond to that message then the details should not be used. Such a system would improve transparency and result in direct opt-in information in every case.

Then there’s payment. More and more content services are using PayforIt so all operators need to be consistent if the channel is to be nationally supported and perceived as a genuine tool of consumer protection.

Finally, publishers themselves need to take action by refusing to take non-compliant advertising. Publishers already have a responsibility to ensure advertising complies with relevant laws and regulations. They take the same stance when it does not comply with the PPP Code of Practice.

If these initiatives (or even some of them) were adopted widely by the industry and the regulator, the cycle of ‘growth, regulation and collapse’ of mobile D2C content markets around the world could be prevented and consumer trust in such services restored.