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EU, UK Clamping Down On Mobile Content Scams

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Two new government initiatives to crack down on rogue mobile phone services: Just days after the EU said it would force operators to lower SMS roaming charges, its consumer chief said today that it was clamping down on mobile content scams—particularly involving ringtones and wallpapers.

EU Consumer Commissioner Meglena Kuneva reported that a EU-wide investigation into 500 sites offering mobile content found that 80 percent of them needed to be checked further for “suspected breaches of EU consumer laws,” more worrying as 50 percent of them were targeted at children and teens.

The breaches range from the more mundane to the serious—including unclear pricing or hidden charges, or not making it clear that consumers were signing up for a subscription service, rather than a one-off purchase. So what next? The EU is apparently going to work with a country’s authorities to hunt out as many rouge sites as they can and ask them to clarify or correct any problems. If they don’t, the site may be fined or shut down.

The EU study found that ringtones make up 29 percent of the overall mobile content market in Europe, and valued it in 2007 at around 691 million euros. (Release).

Separately in the UK, the country’s premium rate telephone services regulator PhonePayPlus is also cracking down on errant mobile content sellers. Starting immediately, any subscription service that doesn’t allow a consumer to stop easily and quickly will be shut down and not allowed to operate. More proposals to be implemented later this year will try to regulate mobile spam and ensure that consumers get fewer unwanted messages. The regulator puts the 2007/8 mobile premium content market worth at £460 million (US$921 million) (Release).

UPDATE: The EU provides a ton more detail on its Website, including naming the list of companies that have been flagged for further investigation. Of the 111 sites, many of the owners are not known. But a couple of names do stand out, including Zed, Jamba, Vodafone, and others. It does not say why the companies were flagged. The sites will be contacted by enforcement personnel, who will tell them to correct the irregularities or face legal sanctions.

Jul 17, 2008 11:50 PM ET

Posted In: Legal, Regulatory, EC, Mobile

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