Time to stop telcos’ pre-termination fee racket

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Philippine telecommunication companies make it relatively easy to apply for their services. But as soon as prospective subscribers take the bait, there seems to be no end in sight for endless aftersales problems and concerns.

Take broadband internet services for example. The Philippine telco industry standard for home-delivered wired or wireless broadband ranges from “up to 384 kbps”  to “up to 2 mbps”. Notice the phrases. How the telcos get away with this deceptive advertising escapes us. The thing about the promised services of “up to X kbps” is that the telcos could just deliver what ought to be called substandard services and yet gouge their subscribers with exorbitant billing. 

This is not about how the Philippine telcos define broadband. That’s another topic altogether and that is the exclusive shameful record of Philippine telcos who roll out arguably the slowest and most expensive broadband services in Southeast Asia. This piece is about how, even with such a depressingly-slow promised broadband speed, the telcos still bungle the job. 

While the telcos continue to earn billions, the flip side is that the Filipino consumer get the shorter end of the bargain. We are told to pay for quality, digital, high-speed broadband. But these telcos do not deliver.  

Rebates and decent customer service are practically unheard of among broadband subscribers who play this daily guessing game whether they would get the broadband they pay for each time they turn on their modems and routers. Telcos brandish their customer hotlines but, overall, customers just get hot air.

In other civilized societies, such a situation would compel government to impose quality standards and to defend consumer rights. Such a situation would negate and invalidate the contracts between telcos and individual subscribers. But no, in the Philippines, even if we are forced suffer substandard services way that do not in any way look or feel like what these telcos promised, we Filipinos are told endlessly that we cannot leave or terminate the contract.

That is unfair. A contract ought to be invalidated if the telcos do not deliver. So-called pre-termination fees should not be levied on suffering customers whose only “offense” is to put a stop to paying for substandard services. Pre-termination fees should only apply in cases when the promised services are actually rendered and yet the customer wishes to opt out.

President Aquino should order the National Telecommunications Commission to check the situation and to defend consumer rights. There are many stories we could read online about long-suffering customers who are forced to pay for substandard services and if they choose opt-out are levied all sorts of fines. In most cases, telcos charge the total monthly fees for the remainder of the contract a customer wishes to end. So just imagine how much money some have been forced to pay the telcos, considering that the common length of a telco service contract is two years.

Yes, Mr. President, this pre-termination fee racket of the telcos should be stopped, and you have the power to do it. The NTC is directly under the Office of the President and there are laws that ought to be enforced to protect the rights and welfare of consumers.

Apart from stopping this racket, the President and the NTC would do well to compel the telcos to implement an automatic and easy rebate scheme to compensate consumers each time they fail to deliver their promised service. In the long run, this would be good for the telcos themselves because they would learn to follow the law, to respect consumers and to deliver what they are supposed to deliver under the franchises and permits granted to them by the Republic of the Philippines.

The President should also direct the Department of Trade and Industry to take a look at the deceptive advertising of these telcos and whether they provide adequate and responsive contact points where consumers could lodge complaints and seek redress for their grievances.

The telcos always claim that they are for free competition but they “jail” consumers in two-year long contracts and stop those they miserably fail to service from availing of better services from competitors. The nerve of these abusive telcos!  

I say, enough is enough. We must say, enough is enough. If you are among the many who want to get out of the grip of your telco and who suffer from substandard service but are scared of the pre-termination fees, be not afraid. Email the NTC at ospac@ntc,gov.ph and commissioner@ntc.gov.ph to complain about it and to request the Commission to nullify the contract, exempt you from pre-termination fees, and to allow you to freely choose a new, alternative service provider.

[Disclosure: The author is a co-founder and current president of consumer advocacy group TXTPower.org]



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