Premium Rate Phone Services

Phonepay Plus which regulates UK premium rate telephone services has fined a Russian company £50,000 for breaching regulations. The Russian company apparently created an android app which when downloaded sent a text message to a premium rate number, thus incurring a £10 charge for the phone owner.

This case illustrates the way in which Phonepay Plus is policing the premium rate telephone market.  Although it aims to police with a light hand it will take steps to ensure that those who abuse the system are taken to task whilst those who play by the rules are free to make use of the opportunities which a premium rate line can bring.

By coincidence, at the beginning of September Phonepay Plus issued a discussion paper on due diligence and risk assessment. Marking the anniversary of the issuing of its 12th code of practice the paper aims to act as a trigger point for discussions on ways to move regulation forward. In the paper the regulator has highlighted some positive steps which have been taken but also warns against complacency with the alternative to an ideal framework of compliance and trust being a“continued ratcheting-up of investigations, sanctions, fines and the overall cost of regulation.”

Although premium rate telephone numbers have had a bad press they can be of great use to businesses in some circumstances. Apart from the obvious benefits of using a premium rate line to pay for calls to tipster services or to run competition lines; premium rate calls can also help to pay for the service which they provide. So, for example, a help desk could be subsidised by the cost of calls on a premium rate line meaning that those who need help are contributing to the cost of calls rather than the cost being spread amongst all customers.

Premium rate lines are strictly regulated by Phonepay Plus and organisations using these lines have to pre-register with the regulator. The regulations can include the need to play a recorded message to callers advising them of the call charge, call recording or automatic call termination when a pre-set limit has been reached. Calls to premium rate lines can be charged at as little as 10ppm rising up to £1.50pm.

Cases such as the one which resulted in the recent fine are thankfully rare but unfortunately they can sour the public’s perception of premium rate numbers. The vast majority of premium rate calls benefit both business and their customers and that is why Phonepay Plus is using its discussion paper as a way to look to the future and build “a more compliant market, where trust and confidence are at its very core.”

Written by nilfg