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SmarTone lets users cancel all-you-can-eat contracts

Operator tries to put unlimited tariff fiasco to bed

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Hong Kong network giant SmarTone has decided to allow customers who signed up to new mobile contracts before 13 February to have them rescinded, as the fallout of its handling of new regulations governing unlimited contracts continues.

In what could be seen as a cautionary tale for mobile providers across the globe, SmarTone has managed to pull off a PR disaster by first angering its customers, then confusing them and then angering them again.

The firm first stated its intent two weeks before the regulation deadline to do away with unlimited tariffs and offer instead a 2GB capped contract – a stance which led to mini protests outside its Mong Kok store.

It then changed its mind when the regulations took effect on 13 February and followed some of its rivals in offering an ‘unlimited’ deal of 5GB fair usage with the caveat that network management restrictions would apply thereafter for customers exceeding that limit.

This again led to anger that it had tricked its customers into applying to renew unlimited contracts pre-13 February when they didn’t need to and the Consumer Council received numerous complaints and enquiries from confused subscribers wondering what was going on.

Ironically the rules were brought in by regulator OFTA to create greater transparency around so-called unlimited tariffs and any associated fair usage policies.

Now SmarTone has bowed to public pressure once again to offer those customers who felt conned into renewing their original unlimited contracts immediately before 13 February a way out:

Those with 'stacked' contracts [ie those who signed up to new contracts before the old ones expired] will revert to their original contracts, while those customers who bought handsets under these contracts are required to return them, undamaged, together with their associated accessories, at the same time. Customers wishing to avail themselves of this option should do so in person with their original contracts and related documents, from 17 Feb to 29 Feb 2012 at any of SmarTone’s retail stores and customer centres.

The firm added, though, that those who renewed before 13 February had the right idea as the latest 5GB deals do not offer as good value because they are “based on a more limited service level definition”.

At no time did SmarTone make any marketing promotions nor any approach to customers on these upgrade privileges, except for customers whose contracts are nearing expiry and were invited to enter into new contracts in the ordinary course of business. SmarTone did not mislead customers into signing new contracts. Customers could also check the level of their recent data usage before entering into new contracts to see whether they made sense.

In many ways operators like SmarTone and 3 Hong Kong which have sought to cling on to unlimited tariffs in a bid to appease their customers are swimming against a global tide of data congestion fuelled by the popularity of smartphones.

An Ovum Asia Pacific report last week claimed that if they fail to change tariff plans and invest more in networks to boost quality of service, they risk incurring the wrath of regulators and alienating customers.

Eversheds lawyer Sian Lewis argued that SmarTone’s latest move will do little to pacify disgruntled customers and improve consumer confidence in the industry.

“The aim of the OFTA guidelines that took effect on Monday last week is to provide service providers with a set of principles that must be followed when implementing fair usage policies to ensure that fair usage policies are developed and applied in a broadly uniform manner,” she told The Reg.

“It was also hoped that the guidelines would help to enhance consumers’ understanding of fair usage policies. Unfortunately the way in which companies such as SmarTone have handled the implementation of the guidelines appears to have caused more confusion and anger for customers trying to get to grips with an already complex area.” ®

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