Misleading ‘per second’ or ‘per minute’ ads for mobile plans fall foul of TRAI  

April 6, 2012

Call rate as half paisa or one-fourth paisa per ‘second’ would be considered misleading if the actual rate is 1 paisa per two seconds or 1 paisa per four seconds Consumer organisations have lauded the move but have also demanded concrete action from the regulator

Moneylife Digital Team

Advertisements that were claiming call rate as “per second” or “per minute” would be deemed misleading if the pulse rate is higher than one second or one minute, said The Telecom Regulatory Authority of India (TRAI). TRAI has issued guidelines on misleading traffic plans advertisements for mobile service providers after noticing non-transparency and ambiguity in these ads. The regulator has asked telecom operators to withdraw the ads which are inconsistent with its directives within 30 days. Consumer organisations have lauded the move but have also demanded concrete action from the regulator.

“Thus, declaration of a call rate as half paisa or one-fourth paisa per ‘second’ would be considered misleading if the actual rate is 1 paisa per two seconds or 1 paisa per four seconds”.

Anil Prakash, president, Telecom Users Group of India, “The directive issued by TRAI is laudable and consumer friendly. Nearly 96% of the mobile users are prepaid subscribers, and majority of them do not read or write. They get their recharge done by a third party or verbal recharge. Why there are too many tariffs? Tariffs should be fixed to one only, and then the regulator does not have to explain so many combinations.”

Tariff-related advertisements will be considered misleading, if the reduced call rate/SMS charge does not indicate that such reduced rate is applicable only after some usage. Plans under a title which suggests absence of rental if the tariff plan has recurring mandatory fixed charge in one form or other and tariff plans with titles such as ‘Zero Rental’, ‘Rental Free’ will also come under this category.

Experts suggest that such clarity in the tariff-related advertisements is in the favour of the consumers but more awareness and continuous monitoring is required.

Hemant Upadhyay, advisor-IT & telecom of Consumer VOICE, an online magazine on consumer awareness, says, “These regulations were overdue in view of new operators coming into play. You would also appreciate that by its very nature in spite of TRAI regulations there is ample scope for mischief by TSPs (telecom service providers). Hence we, the consumer watchdogs, need to be continuously alert to these wrongdoings of the TSPs.”

He adds, “However we need to wait and see how the TSPs behave in light of these new TRAI regulations which came into effect from 1 April 2012 regarding Tariff Voucher system wherein all the tariffs chargeable to a consumer have been classified under four different voucher categories.”

The association representing service providers have also welcomed the move.
Rajan Matthews, director general, Cellular Operators Association of India (COAI) told Moneylife, “We certainly agree with TRAI on this. It will bring more clarity to the tariff-related advertisements. All telecom players will comply with the directions.”

Sector regulator TRAI has also asked the TSPs to file a certificate of compliance with them on a half-yearly basis, on the 15th of January and July each year, confirming that all tariff advertisements issued by the access service provider during the preceding six months were in compliance with the provisions of this direction.  

TRAI has also given examples of misleading advertisements.

• Advertising a scheme/pack as ‘Free’ would be misleading if there is a cap on the daily usage and such cap is not conveyed in the advertisement
•  Advertising a specific discounted STD/ISD as general rate would be misleading if such STD/ISD rates are applicable only in respect of calls to specific regions/countries.
• Advertising a discounted rate without mentioning the fixed fee component to be paid by the subscriber for availing such discounted rate would be misleading if such conditions are not explicitly stated in the advertisement.
• Advertisement that omits certain vital terms and conditions attached to a set of tariff such as the “validity period” would be misleading in situations where such declared tariff benefit is available only for a specific period.