Data rollover on all broadband contracts?
The Independent Communications Authority of South Africa (ICASA) has recently released its Draft Code of Conduct on the Sale, Lease, Rental or Subsidisation of Subscriber Equipment, guidelines which are aimed at regulating the bundling of phones and other equipment with telecoms contracts.
This document prescribes a code of conduct related to the sale, lease, rental or subsidization of subscriber equipment and minimum standards in that regard for end-user and subscriber service charters, and aims to protect consumers of these services.
A variety of issues are handled in this draft code of conduct, including contractual issues, the freedom to purchase subscriber equipment, tariffs and offenses & penalties. If a company is found to be in non-compliance with the code of conduct it can impose a maximum fine of R250,000.
One section which may be of particular interest to broadband users is a clause which relates to carryover of ‘unused units’.
According to the document “a licensee, its agent or reseller shall not be entitled to require the subscriber to forfeit any unused units, capacity or minutes, as the case may be, in respect of any period. A licensee, its agent or reseller shall give subscribers a credit for any unused units, capacity or minutes, as the case may be, upon termination of the contract.”
Currently unused data which is purchased as part of a monthly broadband service typically expires at the end of every month, and in the case of MTN and Vodacom data bundles last no longer than 60 days.
This code of conduct may well have a significant impact on the local telecoms and broadband market if it is implemented in its current form, especially if data and call minutes never expire and must roll over indefinitely. The exact interpretation of this part of the code is however still unclear.
According to one legal expert one will need to “carefully consider the difference between a service for a set amount of data and a service which imposes a maximum usage cap” when trying to see whether this section applies to a data service.
He added that while such a clause is welcome and will ensure that consumers get what they pay for, it is a clear case where the interests of service providers and consumers don’t overlap. He further expects that this clause will be strongly opposed by service providers.
This Draft Code of Conduct is open for comment until 27 January.
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