ARCHIVED - Telecom Public Notice CRTC 2002-2

Telecom Public Notice CRTC 2002-2

Ottawa, 9 April 2002

900 Service - Agreements and consumer safeguards

Reference: 8665-C12-15/02 and Bell Canada tariff notices 740 and 741 (National Services Tariff)

Summary

The Commission is inviting public input on proposed changes to agreements between telephone companies and service providers that provide information and entertainment services to consumers through 900-service numbers for which users are billed by the telephone company or by the service provider. The Commission will also consider whether existing consumer safeguards are effective or need to be changed, and also whether additional safeguards should apply where consumers are billed directly by the service provider for 900-service calls.

These services, some of which can be very expensive, include explicitly sexual chat lines, psychic consultations, soap opera updates, games of chance, trivia games, government services, sports scores and weather forecasts.

Two recent joint applications by Bell Canada, Aliant Telecom Inc., MTS Communications Inc. and TELUS Communications Inc. propose changes to the three agreements that define the business relationship between the telephone companies and the service providers. The changes, which have a direct impact on consumers, include:

• providing consumer safeguards for 900 services that can be accessed via the Internet;

• expanding the information that service providers must provide to inform consumers they are being billed directly by the service provider;

• prohibiting "scratch and win" fraud;

• reducing caller charges for games-of-chance services; and

• increasing the maximum charge for calls to psychics from $100 to $200 while decreasing the maximum per-minute charge for such calls.

Background

1.

Various businesses and organizations use 900-service numbers to provide customers with information and entertainment services. Some non-profit charitable organizations use 900 service to process donations from the public.

2.

By calling 900-service numbers, consumers can have conversations of an explicitly sexual nature, participate in chat lines, consult psychics, access services with an explicit sexual content, access various entertainment services such as horoscopes, soap opera updates, trivia games and games of chance, and obtain information about sports scores, weather forecasts, medical issues and government services.

3.

900-service agreements define the business relationship between the telephone company and the service provider that provides the content of a message or any other service to callers through a specific 900 number. The Commission is responsible for reviewing and approving the form and content of these agreements because they set out the terms and conditions associated with the provision of 900 service. These 900-service agreements are:

• the Service Provider (SP) Agreement;

• the Accounts Receivable Management (ARM) Agreement; and

• the Alternate Billing Arrangement (ABA) agreement.

4.

In general, the SP agreement defines the rights and obligations of the telephone company and the service provider. For example, the SP agreement would include the requirement for a preamble at the start of each call to clearly state the charge for the call and to describe the service to be provided, the liability of the parties, the confidentiality of information exchanged between them and termination of the agreement. The ARM agreement specifies terms and conditions that, among other things, allow the telephone company to collect customer payments for 900 calls on behalf of service providers. The ABA agreement specifies terms and conditions that, among other things, allow the telephone company to provide billing information to the service provider to allow the service provider to collect fees from customers for their 900 calls.

The Companies' proposals

Tariff notice 740

5.

On 28 November 2001, Bell Canada, on behalf of Aliant Telecom Inc., MTS Communications Inc. and TELUS Communications Inc. (the Companies), filed tariff notice (TN) 740 with the Commission. TN 740 proposed revisions to the three 900-service agreements.

6.

The revisions involve:

• providing consumer protection for 900 services accessed via the Internet; namely, providing an announcement indicating that the caller must pay for the call unless the caller disconnects immediately, and providing an opportunity for the caller to click on an "I agree" dialogue box in order to proceed with the service;

• including additional information requirements that service providers must fulfil to ensure that customers recognize that they can be billed by a party other than the telephone company for a 900 service call;

• prohibiting "scratch and win" type frauds that generally involve individuals receiving game cards by mail indicating that the recipient has won a prize and must call a 900 number to obtain information on redeeming the prize, the value of which is less than the cost of the call; and

• reducing caller charges to $5 from $25 for games of chance whose primary purpose is to realize a profit for the service provider from the charges paid by callers to a 900 number.

Tariff notice 741

7.

On 19 December 2001, the Companies filed TN 741 proposing changes to the ARM agreement. This application proposed increasing the maximum charge for a call to a High-Cap Psychic Line Service from $100 to $200, and decreasing the maximum per-minute charge from $10 to $6 for such calls. A High-Cap Psychic Line Service provides callers with real-time consultations with psychic advisors. This service may be offered in accordance with 10 selection requirements, which are specified in the SP agreement. These requirements include a deposit and, as an additional security, the provision to the telephone company of an irrevocable letter of credit in the amount of $1 million.

8.

The Companies submitted that customers have been requesting longer call durations. The Companies also noted that no content providers currently charge more than $6 per minute for calls to such services. At $6 per minute, with a maximum charge of $100, a call to such a service will be terminated when the maximum charge is reached after 16 to 17 minutes. According to the Companies, the proposed changes will allow service providers to increase revenues and to improve customer service by doubling the time each customer can spend on a call.

Order 2002-143

9.

In Telecom Order CRTC 2002-143, dated 9 April 2002, the Commission approved on an interim basis, the changes proposed in TN 740.

The proceeding

10.

Before considering TN 741 and whether to grant final approval to TN 740, the Commission considers it appropriate to seek public comment on the changes proposed in both applications.

11.

The Commission also considers that it would be appropriate to seek comment on whether the existing consumer safeguards associated with 900 service, as well as the mechanisms and procedures for their enforcement, are effective, and if not, on possible changes to them.

12.

The Commission notes that, currently, certain consumer safeguards apply when the telephone company bills customers and collects payment for 900 calls under an ARM agreement. However, these consumer safeguards do not apply when the service provider bills and collects payments directly from customers.

13.

Under the existing ARM agreement, where a customer disputes a charge for the first time, the telephone company waives the charge, which is absorbed by the service provider. The telephone company then offers the customer call-blocking on the 900 number or numbers that are related to the disputed charge. If the customer refuses to accept the call-blocking offer and disputes subsequent charges, the telephone company waives the disputed charges, but provides the necessary call detail information to the service provider, who proceeds to collect any money owed by the customer. There are no such provisions when the service provider performs the billing and collecting functions.

14.

The Commission considers it appropriate to examine whether consumer safeguards similar to those contained in the ARM agreement can and should also apply when the service provider performs the billing and collecting functions.

15.

The agreements that contain the existing safeguards are available for review in the Commission's public examination rooms. These agreements have been attached to the two tariff notices submitted by Bell Canada (TNs 740 and 741).

Procedure

16.

The Companies are made parties to this proceeding. Other parties wishing to participate fully in this proceeding must notify the Commission of their intention to do so, by 22 April 2002. They should contact theSecretary General by mail at CRTC, Ottawa, Ontario, K1A 0N2, by fax at (819) 953-0795 or by email at procedure@crtc.gc.ca. They are to indicate in the notice their email address where available. If parties do not have access to the Internet, they are to indicate in their notice whether they wish to receive disk versions of hard copy filings.

17.

The Commission will issue as soon as possible after the registration date, a complete list of interested parties and their mailing address (including their email address, if available), identifying those parties who wish to receive disk versions.

18.

By letter dated 9 April 2002, the Commission is issuing interrogatories to the Companies.

19.

The Companies are to file responses to the Commission's interrogatories, serving copies on all parties, by 6 May 2002.

20.

Any members of the public who only wish to file written comments, without receiving copies of the various submissions, may do so by submitting their comments to the Secretary General by mail at CRTC, Ottawa, Ontario, K1A 0N2, by fax at (819) 953-0795 or by email at procedure@crtc.gc.ca no later than 21 May 2002.

21.

The Companies may file comments with the Commission with regard to consumer safeguards and other interested parties may file comments with the Commission with regard to consumer safeguards and TNs 740 and 741, serving copies on all other parties, by 21 May 2002.

22.

The Companies may file reply comments with regard to consumer safeguards and TNs 740 and 741, and other interested parties may file reply comments with regard to consumer safeguards, serving copies on all parties, by 4 June 2002.

23.

Where a document is to be filed or served by a specific date, the document must be actually received, not merely sent, by that date.

24.

Parties can file their submissions on paper or electronically. Submissions longer than five pages should include a summary.

25.

Submissions filed in electronic form should be in the HTML format. As an alternative, those making submissions may use Microsoft Word for text and Microsoft Excel for spreadsheets.

26.

Please number each paragraph of your submission. In addition, please enter the line ***End of document*** following the last paragraph. This will help the Commission verify that the document has not been damaged during transmission.

27.

Only those submissions filed in electronic form will be placed on the Commission's web site at www.crtc.gc.ca , and only in the official language and format in which they are submitted.

28.

The Commission also encourages interested parties to monitor the public record of this proceeding (and/or the Commission's web site) for additional information that they may find useful when preparing their submissions.

Locations of CRTC offices

29.

The record of this proceeding may be examined, or will be made available promptly upon request, at the Commission's offices during normal business hours:

Central Building
Les Terrasses de la Chaudière
1 Promenade du Portage, Room G-5
Hull, Quebec K1A 0N2
Tel: (819) 997-2429 - TDD: 994-0423
Fax: (819) 994-0218

Bank of Commerce Building
1809 Barrington Street
Suite 1007
Halifax, Nova Scotia B3J 3K8
Tel: (902) 426-7997 - TDD: 426-6997
Fax: (902) 426-2721

405 de Maisonneuve Blvd. East
2^nd Floor, Suite B2300
Montréal, Quebec H2L 4J5
Tel: (514) 283-6607 - TDD: 283-8316
Fax: (514) 283-3689

55 St. Clair Avenue East
Suite 624
Toronto, Ontario M4T 1M2
Tel: (416) 952-9096
Fax: (416) 954-6343

Kensington Building
275 Portage Avenue
Suite 1810
Winnipeg, Manitoba R3B 2B3
Tel: (204) 983-6306 - TDD: 983-8274
Fax: (204) 983-6317

Cornwall Professional Building
2125 - 11^th Avenue
Room 103
Regina, Saskatchewan S4P 3X3
Tel: (306) 780-3422
Fax: (306) 780-3319

10405 Jasper Avenue,
Suite 520
Edmonton, Alberta T5J 3N4
Tel: (780) 495-3224
Fax: (780) 495-3214

530-580 Hornby Street
Vancouver, British Columbia V6C 3B6
Tel: (604) 666-2111 - TDD: 666-0778
Fax: (604) 666-8322

Secretary General

This document is available in alternative format upon request, and may also be examined at the following Internet site: http://www.crtc.gc.ca