Phonepayplus to launch investigation into mobile content market

Phonepayplus is to investigate mobile phone premium rate digital services following a sharp rise in consumer complaints.

The premium rate regulator said complaints during the first three months of this year are up by 40 per cent on the same period last year. Although premium content providers have to abide by Phonepayplus’ strict code of conduct, including making pricing clear and obeying the 'stop' command from users of subscription services, figures suggest some companies are flouting the rules.

The watchdog received 4,500 complaints between January and March this year and most concerned ringtones, games and competitions, with consumers saying they had been hit with higher bills than expected.

The investigation will examine the marketing of digital content for mobile phones, which has already become a £350m-a-year premium-rate industry.

Phonepayplus chief executive George Kidd said: "There are clear rules when it comes to the promotion, content and delivery of mobile phone paid services. We expect these rules to be followed and any failings of compliance will be punished."

Although Phonepayplus (formerly known as Icstis) has the power to fine or ban businesses breaking the rules from using premium-rate numbers, the watchdog said the review will also help it establish if its powers are strong enough.

The review will focus on unsolicited promotions, especially in the form of text messages, subscription services including ringtones, price transparency and the use of words that indicate content is free when it is not.

The regulator handed out fines of more than £360,000 in 2007 and has already imposed penalties of £291,500 this year. The results of the investigation are expected be published in July.