Mobile Marketing Magazine

Industry Bodies Welcome Premium Rate Code Proposals

PhonepayPlus, the premium rate industry regulatory body, has issued details of its next consultation process that, if ratified will see it introduce a simplified Code of Practice for the premium rate industry. Central to the proposed new regime is a Registration Scheme that will shine a light on rogue providers and provide consumers with helpful information on services they may have bought, or are thinking of buying.
Rather than simply revising the current Code of Practice, PhonepayPlus has built a new Code from the ground up, based on the outcomes that consumers expect when they purchase a service, such as transparency, fairness and a simple process when they encounter a problem.
There are two significant changes to the current regulatory regime proposed in the new Code. Firstly, it shifts responsibility for compliance in the PRS (Premium Rate Services) value-chain. This means placing responsibility for consumer outcomes with those who actually operate and promote the service, while emphasising the due diligence and risk assessment duties of other businesses who help deliver the service to consumers.
Secondly, it proposes an industry Registration Scheme that requires all networks and providers involved in PRS to register their companies and services with PhonepayPlus before they can do business in the UK, giving consumers access to more information on services and allowing industry to make better informed decisions on which businesses to partner with.
Critically, the new Code would allow PhonepayPlus to quickly and directly target the relevant PRS provider responsible for causing consumer harm. For example, the new Code could be enforced against the party responsible for the content, promotion or operation of a service where there was a breach of consumer protection rules or against a network or other provider who had failed to do proper due diligence and risk assessment on a service that was harming consumers. PhonepayPlus is now seeking responses to its proposals from both consumers and industry stakeholders. during a 10-week consultation period.
The move has been welcomed by the premium rate industry trade body, The Association for Interactive Media & Entertainment (AIME), and by the Mobile Entertainment Forum (MEF).  AIME says the proposed changes support its long-held view that regulatory responsibility should be fairly and proportionately applied down the value chain with more emphasis on merchants’ services at the point of sale, where the services meet the consumer and where customer service, together with investment in quality premium products is key to building trust in premium rate services.
But AIME says that if this approach is to work, there needs to be an industry registration scheme for PRS operators, which will underpin the new Code. It is also calling for a robust system to be put in place for customer enquiries regarding premium rate services. For example, it is essential that the PhonepayPlus Number Checker, which allows consumers to check on services they have used, is effective in providing accurate customer care contact information, which will ensure that service enquiries are dealt with by the Merchant quickly and avoid unnecessary escalation to PP+ as complaints. Finally, says AIME, PhonepayPlus  needs industry support in to achieve a successful regulatory framework, that offers the necessary balance of consumer protection but also encourages innovation, investment and, ultimately, industry growth.
The Mobile Entertainment Forum (MEF) has responded to the news with the announcement of industry briefings and the launch of a global regulatory database, describing the PhonepayPlus consultation as “its most important Code consultation yet.”
The MEF believes that the distribution of regulatory responsibility along the value chain, including content businesses that market directly to consumers, is one of the most significant proposals in the consultation, noting that, to date, PpP has only been able to pursue the aggregator, which typically does not promote or control the content sold to the consumer, rather than targeting companies directly responsible for causing consumer harm.
It adds that the proposed mandatory registration scheme for all parties in the premium rate value chain. has clear advantages, since it means that PhonepayPlus will link its adjudications to businesses and their directors, so that companies can carry out due diligence on their partners and, as a result, rogue providers should find it very hard to operate in the UK premium rate industry.
“We welcome the fresh approach taken by PhonepayPlus, with a focus on future-proofing and a recognition that the mobile industry is constantly evolving,” says Suhail Bhat, MEF’s Policy & Initiatives Director. “However, there remain unanswered questions, such as the definition of a premium rate service. In a world where content and services can be accessed and purchased on multiple devices, convergence is an increasingly disruptive force on legal definitions. We will be seeking clarity on the criteria determining which services will fall under the remit of PhnepayPlus and its Code.” 
The consultation closes on 8 July, and MEF is hosting two events to gain maximum industry input and feedback for the regulators. On 6 May, it will hold a webinar on the proposed registration scheme, while on 19 May, it is running a live workshop on the PhonepayPlus Code consultation, hosted by Denton Wilde Sapte.
There’s more information on the webinar here. And on the workshop here.
You can read the PhonepayPlus consultation document here.

EU Harmonises Rules for Mobile Use on Ships

The European Commission has adopted new rules to make it easier for passengers and crew on ships in the EU's territorial waters to make mobile phone calls or send and receive text messages when they are out of range of land-based mobile phone networks. The new rules harmonise the technical and legal conditions for on-board communication services and pave the way for innovative applications, such as remote monitoring of containers stored on-board. This brings new legal certainty and economic opportunities, for service providers who want to offer seamless maritime mobile connectivity across borders.
"Tens of millions of people who travel and work on ships anywhere in European territorial waters will be able to use their mobile phones without problems of interference as a result of the new rules just adopted by the Commission,” says EU Digital Agenda Commissioner, Neelie Kroes.
The Commission says the new rules should put an end to the previous patchwork of 27 different sets of national legislation on mobile phone coverage on-board cruise liners, cargo ships and ferries in European territorial waters. The rules create legal certainty for telecoms operators that wish to offer maritime mobile services to their customers.
On-board mobile communication services operate through small (“pico-cell”) on-board base stations which connect sea travellers' phones to land-based network equipment via satellite. The on-board services ensure the connectivity of users via telecommunications networks by a normal mobile phone.
A Decision just adopted by the Commission guarantees the availability of 900 MHz and/or 1800 MHz GSM radio frequencies for on-board communication services under harmonised technical and operational conditions. It also ensures that on-board mobile services do not interfere with land-based ones, so that mobile users on the coast are not inadvertently connected to on-board systems.
At the same time, the Commission has adopted a Recommendation that EU countries liberalise their authorisation regimes in a way that any on-board services operator authorised in one country can provide services in the territorial waters of other EU countries without the need for further licences.
Together, these two measures will make it easier for passengers and ships' crews to stay in touch with family and friends via their own mobile phones while at sea. The continuous maritime connectivity will also enable the real-time monitoring of transported goods thanks to remote sensors. For instance, a container’s temperature and humidity can be monitored from a distance so that the quality of merchandise stored on ships can be controlled at any time.
EU Member States have 12 months to make room for mobile communication services on ships in the radio spectrum bands concerned, and to adjust their national laws to comply with the Decision. Member States also need to ensure that consumers are adequately informed about the terms and conditions for the use of mobile communication services on ships.

Apple Back on the Warpath

While its legal battle with Nokia continues, Apple has filed a lawsuit against HTC for infringing on 20 Apple patents related to the iPhone’s user interface, underlying architecture and hardware. The lawsuit was filed concurrently with the US International Trade Commission (ITC) and in US District Court in Delaware.
Apple is fighting a legal battle with Nokia on two fronts. In October last year, Nokia filed a complaint against Apple, alleging that the iPhone infringes Nokia patents for GSM, UMTS and wireless LAN (WLAN) standards. Two months later, Apple responded by filing a countersuit claiming that Nokia had infringed 13 of Apple's own patents.
Commenting on the HTC lawsuit, Apple CEO Steve Jobs said: “We can sit by and watch competitors steal our patented inventions, or we can do something about it. We’ve decided to do something about it. We think competition is healthy, but competitors should create their own original technology, not steal ours.”

EU Approves Orange/T-Mobile Merger

The merger between T-Mobile and Orange in the UK has been given the green light by the European Commission after the operators agreed to give up some of their spectrum. The decision means that implementation of the integration measures can start immediately. Orange says the closing of the transaction is expected in the spring.
Tim Höttges, CFO of Deutsche Telekom, says the decision is: “excellent news, for our customers, for our highly committed teams in the UK and for our shareholders.”
Höttges adds: “Now the way is clear for pooling our resources to create an outstanding high-speed mobile broadband network in one of the most competitive markets in Europe. This joint venture company is based on a significant potential of synergies which create substantial value for the two shareholders and translate directly into customer benefits. Our teams in the UK will be rolling up their sleeves to roll out these benefits."
The operators’ parent companies Deutsche Telekom and France Telecom offered to divest 2x15 MHz of their joint GSM spectrum (1800 MHz) by the end of 2011. Of the divested spectrum, 2x10 MHz needs to be cleared by 30 September 2013 at the latest,  and a further 2x5 MHz need to be cleared by 30 September 2015 at the latest. In addition, the existing network sharing deal with 3UK, owned by Hong Kong based Hutchison Whampoa, was reinforced.
Orange says that, as outlined back in September 2009, the new joint venture company is expected to generate estimated synergies with a net present value in excess of €4 billion (£3.6 billion). The new business will have pro forma 2009 revenues of approximately €8.5 billion and EBITDA of €1.55 billion.
The board of the new joint venture company will have balanced representation from Deutsche Telekom and France Telecom. On the formation of the new business, Tim Höttges, CFO of Deutsche Telekom, will lead the board as non-executive chairman for two years after which time it will rotate to Gervais Pellissier for two years. The management team will be led by Chief Executive, Tom Alexander, currently CEO of Orange UK, and Richard Moat, currently CEO of T-Mobile UK, who will take on the role Chief Operating Officer.
The T-Mobile and Orange UK brands will continue to operate in the UK for at least 18 months after the completion of the transaction. The company will have a combined customer base of around 29.5 million.
The Communications Consumer Panel, which was established to advise Ofcom and other bodies on the consumer interest in the markets it regulates, says that while the conditions attached to the merger are designed to address some of the consumer concerns raised by the panel, without seeing the Commission's detailed analysis, it is not possible to say whether the merger will be good for UK consumers.
"UK consumers have up to now benefited from the choice, innovation and low prices that result from a competitive mobile market and we want to see this continue," says Panel Chair Anna Bradley. "There may be advantages to clearing the merger at this early stage, but it also carries risks for consumers. If the decision-making process had involved a more detailed and open investigation this would have allowed greater scrutiny of the merger's impact and given consumers more confidence in the outcome. It is now incumbent on T-Mobile and Orange to proceed with the merger with minimum disruption and confusion for their customers."

Data Roaming Caps Come Into Force

European legislation that forces operators to cap roaming data charges at €50 (£45)/month comes into effect today. To comply, operators must first warn users when they reach 80% of the cap and then cut off at 100% of the cap unless the user has agreed different pre-determined limits. The move is designed to protect consumers from 'bill shock' when they surf the Internet with their mobile phones and laptops while travelling in other EU countries. In 2009, a German traveller who downloaded a TV programme while roaming in France faced a bill of €46,000. In another recent example, a UK student was reported as receiving a bill of almost €9,000 for data roaming during a single month while studying abroad.
Under roaming Regulation No. 544/2009, mobile phone operators are obliged to offer their customers the monthly €50 cut-off limit, but they can also offer them any other limit. Until 1 July 2010, customers need to make a deliberate choice in order to benefit from a cut-off limit. Customers who do not make a choice by 1 July 2010 will have the cut-off limit set at €50 by default as from that date.
The price that operators pay each other per megabyte (MB) downloaded has been limited to a safeguard level of €1 per MB, and it will fall over the next two years. The European Commission says that these savings should be passed on to consumers and deliver lower prices for surfing the Internet while abroad.
Member States' national telecoms regulators are responsible for ensuring that mobile phone operators comply with the rules on cut-off mechanisms for data roaming in each EU country. Consumers can contact the national regulator in the Member State where they reside if they encounter any problems or have concerns over these cut-off limits.
For its part, the European Commission says it will continue to monitor developments in roaming services and the correct implementation of these provisions, in close cooperation with BEREC, the Body of European Regulators for Electronic Communications, which held its first meeting on 28 January 2010. The Commission will analyse the functioning of the roaming Regulation, including the provisions on data roaming, in an interim report due in June 2010 and in a more extensive review in June 2011.
"Protection against data roaming bill shocks is a useful step towards building customers' confidence to use mobile networks to surf the Internet when travelling around Europe,” says Digital Agenda Commissioner, Neelie Kroes. “Such confidence is essential if people and businesses are to use the Internet to its full potential".
There’s more information on the European Commission's roaming website.

Does Google Dream of Impending Court Cases?

Google has hit a snag just days after the official launch of its Nexus One handset. A report from Wired.com suggests that the family of sci-fi legend Philip K. Dick is alleging that the search giant took the handset’s  name from one of Dick’s most famous novels, ‘Do Androids Dream of Electric Sheep?' (the book on which the classic movie ‘Blade Runner’ is based, without asking the family’s permission. In the book, private detective Rick Deckard attempts to track down a Nexus 6 model rogue android.
“Google takes first and then deals with the fallout later,” Isa Dick Hackett, Dick’s daughter, told Wired.com.
The family has sent a letter to Google demanding that it stops using the name, but Google says that the name has nothing to do with Dick’s work, and that it is simply using the word in its original sense, as a place where things converge.
Wired notes that Dick’s estate also protested about Google Book Search when it was announced last, arguing that it was overly complicated and that copyright holders were being asked to make binding decisions.

Anything You Can Sue...

Apple has responded to Nokia’s legal action against the company by filing a countersuit claiming that Nokia is infringing 13 of Apple's own patents.
“Other companies must compete with us by inventing their own technologies, not just by stealing ours,” says Bruce Sewell, Apple’s General Counsel and Senior Vice President.
Nokia filed its suit against Apple in October, alleging that Apple's iPhone infringes Nokia patents for GSM, UMTS and wireless LAN (WLAN) standards. The 10 patents in suit relate to technologies fundamental to making devices which are compatible with one or more of the GSM, UMTS (3G WCDMA) and wireless LAN standards. The patents cover wireless data, speech coding, security and encryption and according to Nokia, are infringed by all Apple iPhone models shipped since the iPhone was introduced in 2007.
Looks like these two won’t be topping each other Christmas card lists this year.

Mobile-paid Service Complaints Fall by 62%

PhonepayPlus, the phone-paid services regulator, has revealed a 62% drop in complaints about mobile phone-paid services in the 15 months between July 2008 (1,981 complaints) and October 2009 (746).
The news coincides with the publication by the EU of an update on the success of its 2008 Europe-wide clampdown on misleading websites offering mobile phone services, such as ringtones and wallpapers. The EU revealed yesterday that out of a total of 301 websites investigated by national enforcement authorities for serious breaches of EU consumer law, 70% of the 301 cases investigated, have now been resolved, with 52% (159 websites) corrected and 17% (54 websites) closed.
The issues raised by the EU included unclear pricing information; lack of contact information; hidden terms and conditions; and the word ‘free’ being used to mislead consumers into long-term contracts. Of the 43 UK websites checked, 39 were found to need further investigation, and five were potential cross-border cases, i.e. when the business, consumer and enforcement agency are not all based in the UK.
Working with the Office of Fair Trading, the statutory UK cross-border authority, PhonepayPlus examined the UK websites highlighted in the ‘sweep’. Many of the websites that appeared suspect transpired to be for services that were no longer in operation and hadn’t been updated in line with the current regulations. The remaining sites were dealt with through PhonepayPlus’ enforcement powers, including informal action with providers and formal PhonepayPlus adjudications; a few investigations are also still ongoing.
In addition, PhonepayPlus introduced new rules for mobile phone-paid services in January 2009. These measures aim to protect the public from a range of practices in the mobile premium content market which were causing complaints and undermining consumers' trust. The new rules include:

• Active confirmation: any consumer joining a subscription service which costs more than £4.50 per week must first receive a free confirmation text message detailing the cost and conditions of the service. The consumer cannot be charged until they have confirmed their subscription by replying to that text.
• Price transparency: price information must be clearly displayed as prominently as any other aspect of the promotion. Promotional material must not suggest any premium rate product or download is ‘free'.
• STOP: providers offering subscription services or sending promotional text messages must enable consumers to easily opt out of the service via the ‘STOP' command. Any failure of this command immediately results in the service being immediately shut down while PhonepayPlus investigates.

PhonepayPlus says it is confident that its strategic policy work, backed up by its enforcement powers, will continue to cut down on bad practice in this area.
Suhail Bhat, Policy and Initiatives Director at the Mobile Entertainment Forum (MEF), says the PhonepayPlus figures show that when regulators and the mobile industry work together, services can operate in a compliant manner to the benefit of all. 
“This is mirrored by the Consumers and Convergence study recently undertaken by KPMG in association with MEF, which showed that consumer satisfaction with mobile music services had grown globally from 26% in 2007 to 66% in 2009,” says Bhat. “We would welcome discussion with the EU on the regulation of mobile services. The mobile entertainment industry is valued at $32 billion (£19 billion) globally, but the regulations for the same content vary tremendously and are applied inconsistently in different Member States. In many cases, there are multiple regulators with remits over both the advertising and content of services. As convergence becomes a reality, more discussion is needed to ensure consumers continue to enjoy mobile content services.”

Mobile Company 'Shops' Alleged Data Traders

An unnamed UK mobile phone company has voluntarily admitted to the Information Commissioner’s Office (ICO) that it believes its employees sold details relating to customers’ mobile phone contracts, including their contract expiry dates. It is alleged that the information was being sold on to the service provider’s competitors, whose agents were using the material to cold call customers prior to contract expiry dates to offer them an alternative contract. The service provider has alleged that many thousands of customer account details have been unlawfully obtained.
After investigating the claims, the ICO says it appears that the information has been sold on to several brokers and that substantial amounts of money have changed hands. The ICO has obtained several search warrants and attended a number of premises, and is now preparing a prosecution file.
The Information Commissioner, Christopher Graham, is pushing for custodial sentences for individuals who trade unlawfully in personal data. He says:
“Many people will have wondered why and how they are being contacted by someone they do not know just before their existing phone contract is about to expire. We are considering the evidence with a view to prosecuting those responsible and I am keen to go much further and close down the entire unlawful industry in personal data. But, we will only be able to do this if blaggers and others who trade in personal data face the threat of a prison sentence. The existing paltry fines for Section 55 offences are simply not enough to deter people from engaging in this lucrative criminal activity. The threat of jail, not fines, will prove a stronger deterrent.”

Nokia v Apple: the Patent Attorneys' View

Nokia’s lawsuit against Apple, alleging that the iPhone infringes 10 of Nokia’s patents, could result in settlement even higher than the $612 million (£375 million involved in the Blackberry case in 2006. But in contrast with that earlier case, this one is unlikely to lead to threats to cut-off the iPhone’s 30 million users.
That’s the view of Nicholas Fox, a Chartered Patent Attorney at London-based Ipulse, who says:  
“This legal action is all about getting Apple to pay for the technology that Nokia says is covered by its patents. Whereas in 2006, Canadian company NTP could have shut down the Blackberry service, there appears to be little likelihood this time of Nokia making similar threats against Apple.”
A big difference between the two cases is that the Nokia mobile phone technology is already available to other companies, through a ‘patent pool’. Rob Jackson, a Patent Attorney at Frank B. Dehn, explains how the system works:
“Basically, if a patent is essential to a particular mobile phone standard, such as GSM, all the companies involved agree to grant a licence at a fair rate. Normally, licences are granted only for the technologies needed to operate the standard. For example, so that the phones can talk to each other and the network operates properly. ‘Nice to have’ features are not covered. It is up to the companies to sort this out between them and the licences are granted company-to-company.”
It seems that Apple is using technology for its iPhone which Nokia claims has not been paid for by the US corporation. 
“Apple may argue that the patents are not valid, so it does not have to pay a licence fee,” says Fox.  “Alternatively, it might claim that Nokia’s patents don’t apply to that part of the standard that affects the iPhone.”
Ilya Khazi, a Patent Attorney at Mathys and Squire, says that the case will probably be settled before any potential injunction against iPhone sales is enforced.
“The timing of the lawsuit is intriguing,” he says, “given that the iPhone is set to go mainstream in the UK, with Orange and Vodafone planning to sell it in the near future.”

Nokia Sues Apple

Nokia has filed a complaint against Apple with the Federal District Court in Delaware, alleging that Apple's iPhone infringes Nokia patents for GSM, UMTS and wireless LAN (WLAN) standards.
Nokia’s argument is that as a leading innovator in wireless communications, it has created one of the strongest and broadest patent portfolios in the industry, investing more than €40 billion in R&D during the last two decades. According to Nokia, much of this intellectual property, including the patents in suit, has been declared essential to industry standards. Nokia notes that it has already successfully entered into licence agreements including these patents with approximately 40 companies, including virtually all the leading mobile device vendors, allowing the industry to benefit from Nokia's innovation.
The 10 patents in suit relate to technologies fundamental to making devices which are compatible with one or more of the GSM, UMTS (3G WCDMA) and wireless LAN standards. The patents cover wireless data, speech coding, security and encryption and according to Nokia, are infringed by all Apple iPhone models shipped since the iPhone was introduced in 2007.
“The basic principle in the mobile industry is that those companies who contribute in technology development to establish standards create intellectual property, which others then need to compensate for,” says Ilkka Rahnasto, Vice President, Legal & Intellectual Property at Nokia. “Apple is also expected to follow this principle. By refusing to agree appropriate terms for Nokia's intellectual property, Apple is attempting to get a free ride on the back of Nokia's innovation.”

Red Bend Secures Update Patents

Red Bend Software has been issued with two new patents by the United States Patent and Trade Mark Office. The patents cover revertible and failsafe features of Red Bend’s already patented in-place update methods used for managing software on mobile devices. Both features improve the user experience and enable Red Bend’s customers to reduce support costs and increase service revenues.
U.S. patent number 7,587,433, issued on 8 September 2009, provides a method for revertible updating. It enables the use of the same update file for both updating the device to a new version and for reverting to the previous version, without the need to download a ‘downgrade’ file. This reduces both memory and transport cost requirements as well as allows the cancellation of an in-progress update.
U.S. patent number 7,599,970 issued on 6 October 2009, provides a method for failsafe in-place updating. It enables the correct resumption of an interrupted update with no additional storage requirements. This feature ensures 100% completion of the update process and eliminates the risk of rendering devices ‘disabled’, which might cause substantial damages in operation costs and brand name.
 “Red Bend continues to innovate and break the boundaries of what’s possible with managing mobile software,” says Founder and CTO, Sharon Peleg. “The addition of these two patents further demonstrates Red Bend’s leadership through innovation in mobile software management.”
In addition to the US, Red Bend has been granted patents in Australia, Canada, Korea, Singapore, India and China.

MMA Responds to FCC Inquiries

In response to the Federal Communications Commission Notices of Inquiry into the United States Wireless Communications Market (FCC 09-157 and 09-51, and FCC 09-66) , the Mobile Marketing Association (MMA) has submitted two responses to the FCC. The first response is to the Notice of Inquiry into the Competitive Market Conditions. The second response is to the Notice of Inquiry into Innovation and Investment.
Both letters are available for download. You can download the response to the Notice of Inquiry into the Competitive Market Conditions here. And you can download the response to the Notice of Inquiry into Innovation and Investment here.
MMA members are encouraged to review both letters and send any feedback to the MMA at: [email protected]  

MEF to Stage Micropayments Conference

The Mobile Entertaintment Forum (MEF) EMEA will hold its second annual regulatory conference, supported by PhonepayPlus on 12 October 2009 at the Royal Statistical Society in London, from 9am - 5pm
The title for this year’s event is: ‘Mobile Micropayments: Trends, Regulations & Future Opportunities”. It will offer the latest updates from key industry regulators; a chance to learn how applications and new services are changing the way consumers access and pay for mobile content; and the opportunity to network with peers from the UK and overseas.
The cost to attend is £150, or £75 for MEF members. For MEF members, there are also sponsorship opportunities at the event. There’s more information here.

MEF Embarks on Asia Tour

The Mobile Entertainment Forum (MEF) is to stage a tour of four key Southeast Asian countries to foster collaboration between regulators and members, and create an environment conducive to the mobile media industry’s continual growth and vibrancy. The two week tour, from 7-18 September, will cover Singapore, Malaysia, Indonesia and India.
The mobile media industry is subject to a considerable number of regulations globally. It sees a variety of content, including games, music, video and ringtones, all accessed on the mobile device. Regulators and the industry alike have been trying to ensure that any regulatory regime meets the needs of consumers, affords an appropriate level of consumer protection and also supports an innovative and rapidly changing industry.
In April, MEF Americas announced the completion of the first phase of its Mobile Sweepstakes Rules Initiative with the launch of 'The Sweepstakes Rules Map: US'. This interactive map of the United States is the first ever to outline the applicable rules and laws governing mobile promotions and sweepstakes on a state-by-state basis. The map was compiled by MEF Americas in partnership with MasurLaw a venture law firm specialising in technology and entertainment.
In July 2009, MEF held three separate workshops on proposed regulatory changes in the UK. The MEF also produces Guides to key pieces of legislation such as the Unfair Commercial Practices Directive and the Audiovisual Media Services Directive. The Guides are written by MEF member and law firm Denton Wilde Sapte
“MEF is building on its regulatory successes in the Americas and EMEA by assisting both the regulators and the industry to ensure that regulations are fit for purpose, transparent and proportionate,” says MEF Asia Chair and Managing Director & CEO of Hungama Mobile, Neeraj Roy. “The industry is showing a genuine commitment to work with MEF and with the regulators to secure a more successful future to benefit everyone, including the consumers, in the value chain. MEF recognises how fragmented the Asian market is and hopes that its efforts to conduct this tour on a country-by-country basis will deliver more positive outcomes for the industry.”
Anyone with issues they would like to see addressed during the tour, or who simply wants further details about the MEF Asia tour, should contact Crystal Chua at: [email protected]

Sybase 365 to Fight Patent Lawsuits

Sybase 365, a subsidiary of mobile messaging and m-commerce company Sybase, has announced its intention to vigorously defend the two patent infringement lawsuits recently filed by Telecommunications Systems, Inc. (TCS), in the Eastern District of Virginia, US. Sybase 365 says it is confident that it will succeed in defeating TCS' assertions in both of these new lawsuits and that the new lawsuits will not impact the conduct of its business.
In one of the cases, TCS alleges infringement of its U.S. Patent Nos. 6,891,811 and 7,358,990, without identifying specific Sybase 365 products or services. In the other case, TCS alleges infringement of its U.S. Patent No.7,430,425, and identifies SMS Exchange as the allegedly infringing product. The complaint recites that the '425 patent issues from the same initial patent application that is the subject of other ongoing litigation between the parties (U.S. Patent No. 6,985,748) and involves the same systems and equipment as in the earlier case.
In a reexamination proceeding filed by Sybase 365, on 4 August 2009, the U.S. Patent & Trademark Office issued a notice initially rejecting all of the claims of the '748 patent, to which the '425 patent is directly related. The claims were rejected on multiple grounds of anticipation and obviousness. Issues relating to the '748 litigation are currently on appeal. However, TCS has chosen not to appeal a civil contempt order issued against it, in which the Court found that TCS had violated the Court's protective order.

Workshop Considers PhonepayPlus Code

The Mobile Entertainment Forum (MEF) is staging a regulatory workshop in London tomorrow (Tuesday 21 July). Among the participants will be PhonepayPlus, which will be seeking industry input and feedback on the pre-consultation discussion paper for its 12th Code. 
The UK’s phone-paid services regulator is asking for substantive comments by 1 August, although the discussion will be ongoing, as the formal consultation will not kick off until the Autumn.
Following MEF’s workshops on the CAP/BCAP Code and Ofcom Scope Review, the session will be hosted by international law firm and MEF member Denton Wilde Sapte and is open to all MEF members. Head of Industry Support & Policy at PhonepayPlus, Mark Collins, will be presenting and taking questions.
“We now have a great window of opportunity to work with PhonepayPlus and Ofcom to ensure that the current regulatory regime evolves to meet the needs of consumers, while also supporting an innovative and dynamic mobile entertainment industry,” says MEF Policy and Initiatives Director, Suhail Bhat.
The event takes place at Denton Wilde Sapte’s offices at 1, Fleet Place, London EC4M from 9am – 12 noon. To register to attend the workshop, email Sarah Roberts at the MEF: [email protected]

AIME Acts on Premium Rate "Scamsters"

The Association for Interactive Media & Entertainment (AIME) has brought together the UK’s leading mobile SMS aggregators (Terminating Providers) to fuse best practices, standards and guidelines which relate to the planning, deployment and management of premium rate mobile services.
AIME members, who are mobile Terminating Providers, and typically also Application Providers, have agreed a series of measures to reduce the incidence of Merchant Promoters (MP) who cause consumer harm by breaching the PhonepayPlus Code of Conduct and other regulations. The AIME members that commit to follow the Best Practice Guidelines have agreed to implement all steps and procedures contained in these guidelines.
12 Terminating Providers worked with AIME to develop the guidelines, and the first five to sign up are Zamano, mBlox, WIN Plc, 2ergo and Oxygen8.
“The Industry wants consumers to trust premium rate services. This trust is being undermined by a small number of Merchant Promoters who flout the regulations,” says AIME Vice Chairman,  Jeremy Flynn. “This Best Practice initiative is designed to assist mobile TPs avoid contracting with miscreant promoters. The industry working together can drive these ‘scamsters’ out of the UK market.” 
The Guidelines cover a series of requirements to ensure that TPs:

• Carry out due diligence on the MP in the same way that the PhonepayPlus 11th Code requires network operators to do so on technical service providers
• Carry out proactive searches to determine whether the MP or its directors have been involved in previous breach activities
• Run passport checks for MPs based overseas to validate identity
• Run bank account checks
• Carry out on-going monitoring and documentation of services to ensure compliance
• Create a compliance culture throughout the TP’s organisation, including sales team
• Provide PRS (Premium Rate Services) regulation training to all relevant parts of the organisation
• Suspend any out-payments to MPs as soon as a suspected breach is identified
• Commit to proactive and regular analysis of traffic reports

Declan Pettit, Managing Director of, Zamano, says:
“As with most Terminating Providers in this industry, Zamano have had regulatory issues with Merchant Providers in the past. Taking a collective view on board about lessons learnt, Zamano are delighted to support AIME’s initiative to set a minimum acceptable standard for the way Merchant Providers promote and operate their mobile services. Not only does it provide a benchmark for Due Diligence, it will also encourage the industry to embrace Compliance as a fundamental element in both their culture and processes going forward."

MEF Issues Call to Action

The Mobile Entertainment Forum (MEF) has issued a call to action, in response to the record number of consultations that the UK mobile industry is being faced with in 2009. 
The MEF notes that the mobile media industry is being subjected to a record number of consultations from a variety of regulators across the globe. The UK is most immediately affected with five key consultations in 2009 alone, including the BCAP/CAP consultations, which recently closed, and four that are still open: the Ofcom scope review; Ofcom Audience Participation in Radio Programming – the use of PRS; Ofcom Broadcast Codes Review; and  PpP Discussion paper on Code.
The MEF believes that there are potentially significant overlaps in jurisdiction between different regulators, as recent MEF responses, written in collaboration with MEF’s UK members, show. These overlaps, it says, can create a lack of regulatory clarity for the industry, particularly when they seek to determine which regulations apply.
For example, the MEF notes, some of the proposed changes to the CAP/BCAP Codes clash with the PhonepayPlus Code. In the UK, Ofcom, the ASA, PhonepayPlus, the OFT and the ICO all have Codes or regulations that apply to the mobile media industry. The MEF says that any ambiguity is likely to cause serious regulatory uncertainty, and as a consequence, the regulatory burden on MEF members runs the serious risk of becoming disproportionate.  
The MEF has established an EMEA Regulatory Committee to deal specifically with the possible burdens imposed on its members and respond to consultations throughout EMEA that directly impact its members' business strategies and revenues. It points out that earlier this year, it submitted a consensus response written in consultation with its UK members to the PpP Activity Plan & Budget (08/09) resulting in no increased costs for its members.
The MEF has also provided members-only guides, written by MEF member Denton Wilde Sapte, on issues including the Unfair Commercial Practices and Audiovisual Media Services Directives, as well the PpP Consultation on Mobile PRS.
It believes there is is a real possibility that the Ofcom Scope Review coupled with the PhonepayPlus consultation could set a new and positive standard for regulation in the UK. Suhail Bhat, MEF Policy and Initiatives Director, says:
“The Ofcom Scope Review is essential for the industry, as its aim is to ensure that the current regulatory regime meets the needs of consumers, affords an appropriate level of consumer protection and also supports an innovative and quickly changing industry. Coupled with the PhonepayPlus discussion paper, this is the best opportunity for the industry, with MEF, to make a real difference.”  
PhonepayPlus has recently announced that the 12th revision of the Code will be among the most significant in the organisation’s 23-year history. Specific focus relates to regulating developments in a technologically fast-paced industry, such as the explosion of mobile phone-paid services, which have changed the face of the industry in recent years.    
Ingrid Silver, Partner Denton Wilde Sapte, MEF Board Member and Chair of the MEF Policy and Initiatives Committee says:
“There has never been a better time for the industry to join MEF and lead the way in ensuring that the regulations are fit for purpose, transparent and proportionate. The regulators are showing a genuine commitment to review the regulations and MEF will continue to work with them to secure a successful future for the industry and ensure that the consumer trust in mobile media services continues to grow.”

Mobile Advocacy Coalition Fights for Mobile Marketing's Future

A body called the Mobile Advocacy Coalition has been formed in the US to, in is own words “lobby the FCC (Fenreal Communications Commission) and protect the future of mobile marketing”.
The Mobile Advocacy Coalition was formed in response to the Court of Appeals for the Ninth Circuit's ruling in the case of Satterfield v. Simon & Schuster, Inc. The Court's decision to remand includes instructions that the group says twist the meaning of the Telephone Consumer Protection Act (TCPA) of 1991 in a way that imperils the entire mobile marketing industry. According to the decision, any computer that sends texts is effectively considered an auto dialer, which puts any mobile marketing campaign on the wrong side of the law.
The Mobile Advocacy Coalition is comprised of mobile marketing firms, mobile software providers, and SMS aggregators, all working together to lobby the FCC to issue a Declarative Order establishing our industry partners as “mere conduits” under the Telephone Consumer Protection Act of 1991.
“Fax broadcasters and the cellular carriers have specific exemptions from the FCC as they are considered to be ‘mere conduits’,” says Shane Neman, CEO of Ez Texing and Mobile Advocacy Coalition Founder. “We too are merely the technology providers, and yet still can be liable under the law because no specific exemption is exists for us.”
How could the Court interpret a computer that sends text messages to be an auto dialer? The court found that because a computer has the capability to generate a random list of numbers - like an auto dialer - it is an auto dialer. The group asks anyone who does not see the issue with this interpretation to consider that their mobile phone is a computer). So, it doesn’t matter whether the mobile marketer adheres to MMA Best Practices or ensures that a list of numbers is opt-in; the interpretation, and thus liability, rests on the issue of capability.
The Court of Appeals has remanded the case to the District Court for further litigation, as it did not agree with the District Court's finding that a computer sending opt-in texts is not an auto dialer. If this interpretation stands, anyone who sends out an SMS-based mobile marketing campaign will be in violation of the TCPA.
The Mobile Advocacy Coalition is currently building a broad coalition of industry participants to lobby the FCC for a Declarative Ruling. It is working with Scott Delacourt, a lawyer at Wiley Rein LLP, who has worked extensively with the FCC, representing the mobile industry.There’s more information here.

Mobile-related Complaints Down 57%

PhonepayPlus, the phone-paid services regulator, says that complaint figures concerning mobile services are down by half, one year on from the introduction of new rules that came about following its 2008 Mobile Review. The new regulation was introduced in response to a worrying rise in consumer complaints regarding mobile services which, on average, account for some 90% of all calls to PhonepayPlus' Contact Centre.
The Mobile Review set out new rules for the mobile phone-paid services sector. It stated that services could not be advertised as free unless they were free from any associated charges; set new rules around trading of third party marketing lists; and introduced a prior permissions scheme for subscription services costing upwards of £4.50 in any given week. The Review also reinforced PhonepayPlus' zero tolerance of any failure of the 'STOP' command for opting out of receiving unwanted contact by text message.
The regulator released the figures at the industry launch of its Annual Report in London yesterday, where it also announced that its Chairman, Sir Alistair Graham, has accepted an invitation to stay in post for a further three years.
PhonepayPlus' complaint figures show that:

• Total complaints regarding mobile services are down 57% from June 2008 compared to May 2009 (2,125 vs 919)
• Consumer complaints regarding mobile subscription services have almost halved since the introduction of the new rules (1,207 vs 651)
• Consumer complaints about unsolicited text messages are down by 85% from the first half of 2008/9 compared to the second half (1,538 vs 230)

“These results show that we are heading in the right direction and sorting the good from the bad in mobile services,” says PhonepayPlus Chief Executive, Paul Whiteing. “It is early days, and we are still analysing the various impacts on our complaint numbers, but these are an encouraging set of results that appear to demonstrate the effectiveness of the new rules, as supported by responsible providers in the sector."
But Whiteing says the regulator is not complacent and remains vigilant for any new opportunistic activity that may result in consumer harm. “This risk is especially acute since, with a country in the midst of recession, we expect the PRS (Premium Rate Services) industry to be attractive to unscrupulous operators looking for ways to make a fast profit. We remain committed to being proactive in preventing non-compliant services from making it to market.”
Commenting on the findings, Suhail Bhat, Policy & Initiatives Director at the Mobile Entertainment Forum (MEF) says:
“MEF warmly welcomes the mobile services complaints figures released by PhonepayPlus, one year on from the introduction of new rules following its 2008 Mobile Review. The fact that total complaints regarding mobile services are down by over half since June of last year is wonderful news for mobile entertainment and reflects the hard work MEF and the wider industry has undertaken to increase transparency and improve the consumer’s experience.
"The findings are mirrored in the Consumers and Convergence study recently undertaken by KPMG in association with MEF, in which we found that consumer satisfaction with mobile entertainment services has grown from 26% in 2007 to 66% in 2009.”
You can access the PhonePayPlus Annual Report here. And you can see the PhonepayPlus Mobile Review here.

The End of the €46,000 Download

Today is the first day of cheaper texting, calling and surfing the web while abroad within the EU, with bthe introduction of new European Commission rules.
From today, sending a text message from abroad in the EU will cost a maximum of €0.11 (£0.09), almost three times cheaper than the previous EU average of €0.28 (excl. VAT). To make a roaming call in another EU country must not cost more than €0.43 per minute, and to receive a call, no more than no more than €0.19. Outgoing roaming calls will be charged by the second, after the first 30 seconds, rather than by the minute, and incoming calls will be charged by the second from the first second.
Holidaymakers and business travellers can also use data roaming more without fear of bill shocks, the EU says, thanks to a wholesale cap of €1 per megabyte (MB) downloaded. The new rules also include a cut-off mechanism once the bill reaches €50 Euro, unless the mobile user chooses another cut-off limit (A German consumer who downloaded a TV programme while roaming in France recently came home to a bill for €46,000.) The EU says that these measures combined are expected to cut roaming charges for EU consumers by a further 60% and increase mobile phone use.
“From 1 July, all Europeans making calls or sending texts with their mobiles can experience the EU's single market without borders,” says EU Telecoms Commissioner, Viviane Reding
“The roaming-rip off is now coming to an end thanks to the determined action of the European Commission, the European Parliament and all 27 EU Member States. I expect the new EU roaming rules to make it much cheaper to surf the web on your mobile while abroad in the EU.”
Noting that the EU rules are limited to reducing inter-operator charges, Commissioner Reding is also calling on the mobile industry to pass these savings on to data roaming customers swiftly.
“The Commission and national regulators will monitor data roaming charges very carefully and assess next year whether the roaming market is finally becoming competitive,” she says.

Premium Rate Regulator Opens Code of Practice Consulation

PhonepayPlus, the regulator for the phone-paid services industry, has launched a wide-ranging discussion paper on the development of its 12th Code of Practice. The paper takes into account recommendations made by Ofcom in its recent PRS (Premium Rate Services) Scope Review, and PhonepayPlus is inviting response from industry, consumers and all other stakeholders in order to properly inform thinking as it develops its full Code consultation for later in 2009. The Code of Practice is the document through which PhonepayPlus regulates the phone-paid services industry, enabling it to protect consumers from harm, while providing reputable businesses with opportunities to develop new, useful products and services for consumers to enjoy using their phones. 
PhonepayPlus says the 12th revision of the Code will be among the most significant in the organisation's 23-year history. The regulator says it intends to carry out a thorough examination of the current version to determine how it might be improved, especially with regard to developments in this technologically fast-paced industry, such as the explosion of mobile phone-paid services, which have changed the face of the industry in recent years.
Recognising that it cannot regulate effectively in isolation from industry and other regulators, PhonepayPlus is publishing the discussion paper ahead of an initial draft of the new Code, upon which it and Ofcom will consult later this year.
PhonepayPlus proposes, and explores the impact of, four main changes to its regulatory regime in the discussion paper. These are:

1. That the new Code is based on identifying desirable outcomes, and supporting them with rules where appropriate, rather than prescribing a step-by-step guide to compliance.
2. That every business in the phone-paid services value chain will assume an appropriate degree of responsibility for the provision of compliant services and the delivery of consumer protection measures.
3. The creation of a database on which all Service Providers (SPs) and Information Providers (IPs) will be registered for due diligence and risk management purposes.
4. That providers must have in place adequate customer care facilities to ensure consumers are able to register a complaint and seek redress as quickly as possible.

“Development of our 12th Code of Practice is one of the most important activities we will undertake this year and it is imperative we get off on the right foot,” says PhonepayPlus Chief Executive, Paul Whiteing. “We want to ensure the Code protects consumers in the ways it should do, while enabling reputable providers to offer innovative, compliant services. This is why we have published this discussion paper ahead of a draft of the Code, in order that we might canvass a wide cross section of views from industry, consumers and our peer regulators as early in the process as possible.”
Comments and submissions are invited from anyone with an interest in phone-paid services, industry, including peer regulators, trade associations and consumers. The closing date for comments is 1 August 2009.
Ahead of an industry workshop organised by Ofcom to discuss its PRS Scope Review, PhonepayPlus has prepared an initial assessment of the potential impact of the proposals on PhonepayPlus. You can read this document here. You can read the Code 12 discussion paper here. And you can read Ofcom's PRS Scope Review here.

Operators Seek Compliant Roaming Solutions, says Starhome

European mobile operators are seeking to quickly find and implement Roaming Control solutions that will enable them to comply with tariff-reduction and roaming legislation set to take effect in less than two months, according to industry analysts at Starhome, which provides roaming services for mobile network operators.
“We are seeing a noticeable rise in inquiries for Roaming Control solutions,” says Starhome Vice President of Marketing, Amit Daniel. “Operators are understandably concerned about finding and implementing solutions in such a short time without incurring penalties, disrupting existing operations or inconveniencing customers.”  
The European Parliament Plenary recently adopted the Roaming II Regulation, which is set to commence on 1 July 2009, and will significantly affect the roaming industry. One provision of the regulation has limited the Euro-SMS tariff. Subscribers sending texts abroad must not be charged more than €0.11 (£0.10), and those receiving text messages in other EU countries cannot be charged. The Commission also proposed a safeguard limit (per megabyte) for wholesale data roaming fees.
Demand for Roaming Control solutions has remained consistently high, says Starhome, with several mobile operators implementing them before the passage of Roaming II regulation. It says the demand has been driven by end user requests, and by operators’ attempts to reduce customer complaints and increase revenues.
An effective Roaming Control solution provides mobile operators with real-time monitoring of data usage and enables operators to define limitations, packages and notifications using existing platforms and connectivity to their current systems. Operators can support different and more complex rating plans for roaming, and allow subscribers to define individual cost caps in real-time.

EC Issues RFID Recommendations

The European Commission (EC) has issued a set of recommendations “to ensure those involved in the design or operation of technology using smart chips respect the individual's fundamental right to privacy and data protection.”
The recommendations follow a public consultation launched in 2006, on the development and use of smart chips (or Radio Frequency Identification technologies). Based on this, it then adopted a Communication in March 2007, showing that further action was expected by the public in terms of privacy and data protection. The EC says the recommendations respond to these expectations and seek to create a level-playing field for the European industry, while respecting individuals’ privacy.
The EC notes that smart chips can, and already do, have a huge impact on business tasks, public services and consumer products, making everyday life simpler. Indeed, it says, there are already over 6 billion smart chips using radio frequency identification (RFID) technology, that can be integrated into a variety of everyday objects from fridges to bus passes. The chips can process data automatically when brought close to readers that activate them, pick up their radio signal and exchange data with them.
“There is clear economic potential in using small, smart chips to allow communication between objects,” says Viviane Reding, EU Commissioner for Information Society and Media. “But Europeans must never be taken unawares by the new technology. This is why the Commission (has) issued strong recommendations to the industry. European consumers must be confident that if and when their personal data is involved, their privacy will be impregnable also in a changing technological environment. The Commission therefore wants RFID technology to empower consumers to control their data security, which is the best way to make sure it is an economic success.”
The Commission's principles include: 

• Consumers should be in control whether products they buy in shops use smart chips or not. When consumers buy products with smart chips, these should be deactivated automatically, immediately and free-of-charge at the point of sale, unless the consumer explicitly opts-in by asking to keep the chip operational. Exceptions can be granted to avoid unnecessary burden on retailers, for example, but only after an assessment of the chip's impact on privacy.
• Companies or public authorities using smart chips should give consumers clear and simple information so that they understand if their personal data will be used, the type of collected data (such as name, address or date of birth) and for what purpose. They should also provide clear labelling to identify the devices that read the information stored in smart chips, and provide a contact point for citizens to obtain more information.
• Retail associations and organisations should promote consumer awareness on products containing smart chips through a common European sign to indicate whenever a smart chip is used by a product.
• Companies and public authorities should conduct privacy and data protection impact assessments before using smart chips. These assessments, reviewed by national data protection authorities, should ensure that personal data is secure and well protected.

We asked Jonathan Bass, Managing Director of mobile agency Incentivated, and a font of all knowledge on all things mobile, for his reaction to the EC’s plans. He told us:
“My first thought is, does Oyster comply? The part about consumers being in control whether products they buy in shops use smart chips or not makes no sense to me. The product with the embedded chip won’t come with private data installed; you have to add your data to it! So I don’t see this as an issue. Bullets 2 and 3 are very sensible, but bullet 4 means more EU bureaucracy and cost."
Member states now have two years to inform the Commission on the steps they intend to take to make sure that the objectives of the Recommendation are met. Within three years, the Commission will report on the recommendation's implementation, including an analysis of its impact on companies and public authorities using smart chips, as well as its impact on citizens.
Some 2.2 billion RFID tags, such as the ones used at toll booths or to identify shipping containers, were sold worldwide in 2008, roughly a third of these in Europe. The worldwide market value for RFID tags is estimated to be €4 billion (£3.6 billion) in 2008 and to grow to about €20 billion by 2018.
You can read the recommendation here.

Monopoly Money

John Strand, CEO of Strand Consult, argues that mobile operators should thank the EU for its intervention on roaming charges

In the media and in the EU, a lot is said about the intervention on roaming taking place. It will cost the industry billions of Euros, seems to be the consensus. At Strand Consult, we believe this approach will be costly in the short run, but in the long run, it’s probably the best thing that has happened to the operators in years, and the shareholders can start to rejoice.
One can view the intervention from many different angles: for its significance for the mobile industry; for innovation within the mobile universe; or for the many companies who develop, market and sell different communications solutions to the industry The mobile operators are not the only companies making a living selling communication cross-borders, far off. The EU just has not realized that.
One of our old heroes once said: “It is every company’s damn duty to try to establish a monopoly!” Some do this by developing products the customers are crazy for, others by being in the right place at the right time with the right product, others again do it by consolidating companies, or taking control of the supply chain.
When the EU took its decision to cap roaming charges, it was in fact helping the mobile industry in creating a monopoly on communication across borders, and a situation that will make it harder for alternative communication solution providers.

Cheap telephony
The fact is that is has always been expensive to call across borders. The liberalisation of the telecommunications market made it possible for other providers to offer cheap international telephony, circumventing the old monopolies. With the invention of the Internet and Skype, suddenly new ways of communication had arisen, and prices of international traffic dropped significantly. Simply put, competition, and the high prices charged by the old monopolies, created a sub-industry that also impacted the prices downwards. If regulation on international calls had taken place in those times, one might ask whether a company such as Skype or the many other IP companies or international telephony providers would have had arisen.
What’s going to happen now in the mobile market is simply that the prices of roaming falls, the politicians are proud of their efforts, and the many companies in the communications industry offering alternative telephony solutions or offering cheaper prices on roaming will have a hard time making a living. The venture capitalists will say that companies in this area are not as interesting as they were before, and customers will have a hard time seeing any benefit in using alternative communications solutions across borders. So the EU has created a foundation for a monopoly for the mobile operators. Not only do they offer roaming, but now also, competitive prices.
Normally it would be expensive and very hard work to create a monopoly, but in this instance, it is almost free for the operators. The low prices will mean growth in traffic as customers will change their attitude regarding the use of their mobile phone abroad. We have seen this before in Denmark, Sweden and Norway, when falling prices quickly were compensated by increased traffic and turnover.

Natural competition
What the EU has done is a prime example of the fact that regulation of a competitive market can be dangerous. When politicians regulate a competitive market such as the mobile market, they influence the natural competition which exists in the market, so that the market, so to speak, gets out of balance. In the next 18 - 24 months, we will see the hard evidence of the political system’s lack of understanding of price, regulating and the way the telco industry works. This will kill innovation at the same time as creating a monopoly for the mobile operators.
A lot of people say that roaming is a problem, but it is not only a EU problem, but one that affects all countries, especially the ones with large numbers of tourists. Historically, we know that the mobile operators first competed on cheap mobile phones, then it was cheap national traffic, then cheap SMS, and now, there is a lot focus on cheap regional traffic. Roaming should be next in line, and actually already is in a number of countries.
Our conclusion is that the EU, with Viviane Redding as Commissioner, knew that public recognition and votes lie in getting the customers cheap roaming here and now! However, either they forgot to tell the end users about the consequences for competition and innovation in the long run, or they simply don’t know what these consequences are. The EU has sent the biggest present to the European mobile industry they could have wished for - the foundation for a monopoly for communication across borders.

MEF "not convinced" by Premium Rate Measures

We’ve had a couple of reactions to telecoms regulator PhonepayPlus’ announcement of new measures governing the marketing and supply of premium rate content on mobile phones. The Mobile Entertainment Forum (MEF) says it welcomes the sentiment of the measures.
“Our members support measures that promote transparency for consumers without hindering their access to and enjoyment of mobile services,” says MEF Policy and Initiatives Director, Suhail Bhat. “It is encouraging that so many consumers are using phone-paid services, nearly 50% according to the PhonepayPlus consultation document. Our main concern is that the proposals appear to collectively punish the majority of content providers by creating a layer of red tape, without actually addressing a small number of rogue elements that persistently mislead consumers.
“We believe that all forms of non-compliance and consumer harm should be dealt with immediately and we would have liked elements of the new rules to allow for consumer complaints to be resolved more quickly. While we are still studying the changes, at this stage we are not convinced that the new regulations achieve anything that wasn’t possible under the previous Code of Practice. However, we will be studying the consultation further following discussions with our members and working with (law firm) Denton Wilde Sapte LLP to produce a guide to its implications for MEF members.”
Meanwhile, Alex Haffner, a Senior Associate and Regulatory Specialist at Denton Wilde Sapte LLP, who participated in the consultation which PhonepayPlus undertook before finalising its measures, says the measures imposed on the industry by the regulator are far-reaching and likely to be controversial.
“Most notably,” says Haffner, “under a new regime, PhonepayPlus will require the providers of certain services to obtain ‘prior permission’ to do so, and this will only be granted once they have agreed to comply with specific conditions governing the nature and content of those services. These will apply over and above the conditions to which all providers are currently subject. PpP has given those affected by these changes just six weeks to obtain the necessary permission from them."

PhonepayPlus Gets Tough

PhonepayPlus, which regulates premium-rate charged telecoms services, has issued a final statement on mobile phone-paid services and their marketing. The statement sets out new measures to protect the public from a range of practices in the mobile premium content market which are causing complaints and undermining consumers' trust.
Having taken into account stakeholder feedback, PhonepayPlus is implementing two new rules. The first is around prior permission: providers offering mobile subscription services charging over £4.50 in any given week or applying pay-per-page charges on the mobile Internet must first apply for permission from PhonepayPlus;
The second concerns active confirmation: as part of the prior permission undertaking, any consumer joining a subscription service must first receive a free confirmation text message detailing the cost and conditions of the service. The consumer cannot be charged until they have confirmed their subscription by replying to that text.
PhonepayPlus notes that hundreds of thousands of consumers use premium mobile services daily. These include downloading ringtones, pictures and games, as well as participating in TV programmes, receiving news alerts, finding contact details and entering competitions. Most of these services operate with no problem, but some companies have adopted practices which are leading to increased consumer complaints. 
PhonepayPlus' review of the premium mobile sector was prompted by a worrying 108% increase in mobile-related complaints received in 2007/08 compared to 2006/7. This was accompanied by anecdotal evidence of consumers, including young people, being charged several thousand pounds in some cases, as a result of bad practice by content and service providers.
PhonepayPlus has issued a Statement of Expectation alongside the final statement, which summarises the changes and actions service providers may need to take in order to remain compliant.
Also detailed in the statement are rules pertaining to:

• Price transparency: price information must be clearly displayed - as prominent as any other aspect of the promotion. Promotional material must not suggest any premium rate product or download is ‘free’
• Promotional text messages: providers sending free promotional messages must inform recipients that the message is free and make clear how to opt out of receiving similar messages in the future
• STOP: providers offering subscription services or sending promotional text messages must enable consumers to easily opt out of the service via the ‘STOP’ command. Any failure of this command already results in the service being immediately shut down while PhonepayPlus investigates;
• Marketing lists: companies that sell or otherwise trade third party marketing lists must provide evidence upon request by PhonepayPlus that recipients have agreed to receive promotional text messages for particular types of services
• Chat: text-based chat services must not imply that users are exchanging messages with other individuals, or that customers will be able to meet people by using the service, unless this is the case.

“There are many innovative, useful and fun services available to consumers via their mobiles,” says PhonepayPlus Acting CEO, Paul Whiteing. “These new measures are targeted at a small number of providers who do not offer services to customers in a fair and straightforward way. Consumers should not need to work hard to understand the full price of any service. The guidelines are the result of intensive research in to the mobile market, and PhonepayPlus expects them to result in fewer complaints and greater confidence in the market.”
You can read the Mobile Policy Statement here. And the Statement of Expectation here.

mBlox Clarifies PhonePayPlus Run-ins

Mobile transaction network mBlox has issued a statement concerning investigations in to UK breaches of PhonepayPlus Code of Practice. mBlox has been the subject of an increasing number of PhonepayPlus adjudications, and says it has released the statement in order to put these in context and make it clear that these are historical problems which have been addressed by mBlox in conjunction with PhonepayPlus. The statement reads:

During the summer of 2008, mBlox was notified by PhonepayPlus of a significant rise in complaints about premium rate services that third parties provide to consumers via the mBlox network and the end user’s mobile carrier network. This trend, which mBlox identified during the summer, reflects an issue that confronts the entire European premium rate services industry as highlighted in the European Consumer Commissioner’s research in July.   
mBlox takes compliance breach seriously, and firmly believes that consumer trust and confidence are essential to the overall health of the industry. mBlox has concluded that monitoring and system tools to verify [that] customers are meeting their ongoing regulatory compliance are necessary to prevent the rogue behaviour exhibited by a small number of information providers. It became clear that mBlox needed to take active steps to verify [that] the compliance responsibilities of its customers were met.
As a result, mBlox has conducted audits of its premium service customers, identifying those whose campaigns are not compliant with the applicable regulations. However, due to the timescale involved in properly investigating complaints, there are some customer programmes that preceded the audits performed by mBlox and it is likely that further adjudications naming mBlox as the Service Provider will be published by PhonepayPlus based on these earlier programmes.
mBlox would like to stress that measures are now in place to address the issues that resulted in this rise in complaints. Complaints from the public relating to services billed by mBlox have consequently fallen dramatically, and to its knowledge no new investigations are arising.
Since July 2008 mBlox has been working closely with PhonepayPlus to ensure that it does all that it can to help its customers comply with the Code of Practice and take a strong lead in mitigating the results of this type of behaviour within the premium rate industry. It has implemented a number of additional measures, including mBlox Detect and a complete revision of its internal procedures, to reverse this trend.
As a further measure of mBlox’s commitment, a number of measures have been implemented, including:
·         An audit of all services and their marketing and promotions run by all mBlox customers in the UK
·         The immediate remediation or suspension of any service found to be non-compliant with the PhonepayPlus Code of Practice
·         The implementation of mBlox Detect, a major new investment in technology, for the routine traffic analysis of billing, to determine if any customers have been charging consumers unjustifiably
·            The introduction of an online Shortcode look-up tool to assist consumers in reaching the providers of services easily for a more rapid resolution
·          Implementation of new risk assessment procedures and blanket compliance certification of all new services before they go live
·           Consulting PhonepayPlus on the adequacy of our compliance management regime

Since August, mBlox has audited over 500 UK services operating on over 400 Shortcodes. All issues discovered during this process have been resolved and since taking these steps, no new cases of customer non-compliance have been identified by PhonepayPlus. During this same time period, call volume to mBlox’s UK consumer helpline has decreased significantly.

mBlox is urging consumers who are concerned about premium rate services to visit the company’s Consumer Care pages.

mBlox Launches mBlox Detect

Mobile transaction network mBlox has announced the UK launch of its ‘mBlox Detect’ technology, which will help identify suspicious patterns of billing traffic running through its network. mBlox says the tool will act as an early warning system to help it quickly identify to the regulator, PhonepayPlus, instances where customers may not be in compliance with service provider regulatory requirements. 
The traffic analysis will be run periodically across mBlox’s network and will help staff identify possible breaches by customers of their contractual obligation to observe all operator and regulatory requirements, well before they might otherwise have been alerted by consumer complaints. 
mBlox Detect has been made possible through a £250,000 investment in technology that forms part of mBlox’s Evolution Programme to implement the latest generation of infrastructure technologies. The company says it will enable it to analyse traffic patterns in a fraction of the time required previously, now making it practical to generate and examine this data.
“Recently there has been a worrying rise in the compliance failures by mobile content providers,” says mBlox CEO, Jeff Clark. “While many of these are accidental breaches, this is not something that can continue for the good of the consumer and the good of the content industry as a whole. mBlox Detect will enable us, for the first time, to identify certain suspicious traffic patterns or instances of genuine error by mBlox customers at the earliest possible moment. We believe that this capability will greatly enhance the ability to protect consumers and for PhonepayPlus to ensure compliance by our customers with their obligation to respect the PhonepayPlus Code.”
The launch of mBlox Detect is part of a series of initiatives to specifically help build consumer trust by directly addressing compliance. Other plans include the introduction of an mBlox shortcode checker to assist consumers in identifying the providers of services transparently, easily and without delay.
mBlox notes that its policy, as a payment transaction network serving hundreds of customers, is to not itself  promote, offer, sell, deliver or provide any services to consumers.

Back the Regulators, Urges zamano

zamano is urging its fellow aggregators to support the proposed clampdown by regulators on rogue D2C content companies. Last week, both the European Commission (EC) and the UK’s premium telephony watchdog PhonePayPlus announced action to tackle abuses by ‘rip-off’ ringtone vendors. 
zamano UK Country Manager Declan Pettit says:
“As with any communications network providing an open channel between content companies and consumers, there is potential for misuse…We believe the mobile content industry can only fulfill its true potential when consumers have complete confidence in the quality and value for money of services they consume on their mobile. Working in complete alignment with regulation is the only way for the industry to achieve this.”
The EC is following up after consumer complaints led it to investigate 500 websites across 27 EU member states, plus Norway and Iceland. It may act against 466 cases. Meanwhile, PhonePayPlus has confirmed that any company not allowing customers to stop a mobile content subscription quickly and easily will be barred from operation with immediate effect.
The crackdown is a throwback to 2004, when the UK regulator first imposed a mandatory ‘Stop option for all consumers taking out subscriptions for mobile personalisation products. That action appeared to work, reducing complaints, but also causing a slowdown in the off-deck mobile content industry. Earlier this year, however,  PhonePayPlus revealed a dramatic rise in consumer complaints, with 4,500 in the first three months of 2008 alone.
The EC’s report said 268 sites had some irregularities in the price, while some did not show the price at all. Others did not make it clear that consumers were entering into a subscription. Meanwhile, 399 sites failed to give complete contract details of the trader, while 344 presented information in what the authorities regarded as a misleading way.

Nokia and Qualcomm Call Truce

Nokia and Qualcomm have entered into a new agreement covering various standards, including GSM, EDGE, CDMA, WCDMA, HSDPA, OFDM, WiMAX, LTE and other technologies. The agreement will result in settlement of all litigation between the companies, including the withdrawal by Nokia of its complaint to the European Commission.
Under the terms of the new 15-year agreement, Nokia has been granted a licence under all Qualcomm’s patents for use in Nokia mobile devices and Nokia Siemens Networks (NSN) infrastructure equipment. In addition, Nokia has agreed not to use any of its patents directly against Qualcomm, enabling Qualcomm to integrate Nokia’s technology into Qualcomm’s chipsets. The financial structure of the settlement includes an up-front payment and on-going royalties payable to Qualcomm. Nokia has agreed to assign ownership of a number of patents to Qualcomm, including patents declared as essential to WCDMA, GSM and OFDMA.  The specific terms are confidential.
“We believe that this agreement is positive for the industry, enabling the market to benefit from innovation and new technologies,” says Nokia CEO, Olli-Pekka Kallasvuo. “The positive financial impact of this agreement is within Nokia’s original expectations and fully reflects our leading intellectual property and market positions.” 
Qualcomm CEO, Dr. Paul E. Jacobs, adds:
“The terms of the new license agreement, including the financial and other value provided to Qualcomm, reflect our strong intellectual property position across many current and future generation technologies. This agreement paves the way for enhanced opportunities between the companies in a number of areas.”

PhonepayPlus Gets Tough on Mobile Content Cowboys

PhonepayPlus, the phone-paid services regulator, has proposed a series of measures to protect the public from harm in the mobile premium content market. The measures, unveiled last week, mean that with immediate effect, any subscription service that does not allow customers to stop it easily and quickly will be barred from operation.
Additional proposals, which could come into force by the Winter, are designed to ensure that consumers receive fewer and more targeted promotional text messages; are able to make informed purchase decisions; and find it as easy to leave a subscription service as it was to join.
PhonepayPlus’ recently-published Annual Report shows an emphatic shift in the phone-paid services market toward mobile. In 2007-8 the mobile premium content market was worth more than £460 million, a significant increase over the year before.
UK consumers are finding great value in these services, the regulator says. As well as downloading ringtones, pictures and games, people are using their mobile phone to participate in television programmes, receive news alerts, find contact details and enter competitions. As mobile devices become ever more powerful, innovative new services continue to appear. Location-based services, for example, could allow providers to offer services based on consumers’ geographic whereabouts.
Research carried out for PhonepayPlus has showed that 38% of UK consumers have used a phone-paid service, amounting to 18 million people in total. The percentage of children (16 and under) regularly using phone-paid services on their mobile phone varied significantly: as many as 32% of children from low-income households, compared to 18% for children in more affluent homes.
However, an extraordinary increase in complaints has accompanied this growth. PhonepayPlus received more than 8,000 mobile-related complaints in 2007-8, a 108% increase on the previous year. In the first three months of 2008 alone, PhonepayPlus received more than 4,500 complaints. There is also anecdotal evidence of consumers, including young people, being charged several thousand pounds as a result of bad practice by content and service providers.
In 2007, PhonepayPlus adjudged 33 mobile services to be in breach and imposed fines of more than £360,000. In the first six months of 2008, the regulator has already adjudicated on 25 mobile phone-paid services with total fines in excess of £390,000.

Subscription services
There are three areas which are of particular concern. The first is the rise in complaints related to subscription services such as ringtones, songs and other mobile personalisation products. In particular, some consumers claim to have been signed up to subscription services with neither their knowledge nor consent; some services are mis-using the word ‘free’ or other similar words; and consumers continue to receive chargeable messages after they send the ‘STOP’ command and some have been re-subscribed without their permission.
PhonepayPlus is proposing the introduction of new rules mandating:
·    Once a consumer has selected a subscription service, they must be told the full cost and then actively confirm they wish to subscribe.
·    No use of the word ‘free’ or similar words to be in promotional material;
·    Where there is evidence of the failure of the STOP command, PhonepayPlus will look to place an immediate bar on the service while it investigates complaints.

Promotional text messages
Another concern for PhonepayPlus is around promotional text messages that are sent to consumers advertising premium rate products and services. The complaints received include instances of consumers receiving promotional messages – and sometimes being charged for them - with no recollection of having asked them to be sent. Additionally, upon opening the text message, the user is immediately ‘pushed’ to a mobile Internet website and charged for access. Finally, it is not made obvious how users can opt-out of receiving messages in the future.
PhonepayPlus says it will continue to work with the Information Commissioner, who is responsible for the use of personal data collected in marketing lists.
PhonepayPlus proposes that providers should provide clear information on how to opt-out of receiving marketing messages in the future. It also proposes that phone-paid service promoters should be able to provide evidence of each recipient’s opt-in, and show that the promotion is relevant to the consumer’s original purchase or reason to opt-in.

Pricing
Finally, PhonepayPlus says it is unhappy about the lack of clarity and transparency of the pricing of some phone-paid services. Many consumers have no idea, or a misperception, of the true cost, often due to misleading promotions. For example, when consumers buy or view content from a website, they are often not provided with the price information necessary to make an informed decision. Additionally, some consumers have received texts from what appears to be another mobile number inviting them to chat. In fact, the texts are from a phone-paid service and replying to them subscribes the user to a chargeable service.
In this area, PhonepayPlus proposes to require that the price of phone-paid services, including mobile Internet pages, must be clearly signaled before the user is charged; and that promotional messages must not mislead consumers into thinking that they are engaging with another individual.
“There is a clear lack of trust among many consumers about mobile premium services, and this is small wonder when you consider the kind of harm that is being done to them by some providers,” says PhonepayPlus Chief Executive, George Kidd. “It's essential that we address this. Only by working together to build trust among consumers will we see a growing, sustainable, vibrant market for phone-paid services.”
The proposals are subject to consultation and can be viewed on the PhonepayPlus website. The closing date for responses is 11 September 2008.

MMA Releases Global Code of Conduct

The Mobile Marketing Association (MMA), which represents 650 member companies worldwide, has released a Global Code of Conduct, designed to provide guidelines that all mobile marketers should consider and build their mobile marketing initiatives around. The MMA Global Code of Conduct is intended to guide companies within the mobile ecosystem so that they can effectively, and responsibly, leverage the mobile channel for marketing purposes, whilst always protecting the consumer experience.
Produced by the MMA’s North American Privacy Committee, with input from MMA Regional Boards of Directors in APAC, LATAM and EMEA, the Global Code of Conduct updates the 2007 revision and aligns the Code with generally accepted global privacy principles. It has five categories:

·    Notice - The fundamental principle of the MMA Privacy Code of Conduct, informing users of the marketers’ identity or products and services offered and the key terms and conditions that govern an interaction between the marketer and the user’s mobile device.
·    Choice & Consent - Respecting the right of the user to control which mobile messages they receive by obtaining consent (opt-in) and implementing a simple termination (opt-out) process.
·    Customization & Constraint - Ensuring that collected user information is used to tailor communication to the interests of the recipient and is handled responsibly, sensitively and in compliance with applicable law. Mobile messages should be limited to those requested by the user and provide value such as product and service enhancements, contests, requested information, entertainment or discounts.
·    Security - The implementation of reasonable technical, administrative and physical procedures to protect user information from unauthorized use, alteration, disclosure, distribution, or access.
·    Enforcement & Accountability - The MMA expects its members to comply with the MMA Privacy Code of Conduct and has incorporated the Code into applicable MMA Guidelines, including the U.S. Consumer Best Practice (“CBP”) Guidelines. Until the Code can be enforced effectively by a third party enforcement organization, the MMA says that mobile marketers are expected to use evaluations of their practices to certify compliance with the Code.

“The MMA believes that strong consumer privacy standards are essential to the success of mobile marketing by protecting mobile users from unwanted communications on their mobile devices,” says Russell Buckley, MMA Global Board Chairman and Managing Director, Europe for AdMob. “It is only through industry support of strong privacy guidelines that the power of mobile marketing can reach its full potential.” 
The MMA Global Code of Conduct can be downloaded here.

European Commission Moves on Text Costs

The European Commission has confirmed that it will begin working on measures to ensure that consumers benefit from “a truly single market for mobile text services,” saying that calls on the industry for self-regulation and voluntary reductions of roaming prices for text messages have not been answered. The average retail price of text messages in the EU has remained unchanged since February when Telecoms Commissioner Viviane Reding called on the industry to lower prices voluntarily
The Commission says it will also seek to put an end to “bill shocks” that can hit roaming customers using a mobile connection to surf the Internet. It says new measures could be proposed by the Commission to the European Parliament and the Council in early autumn.
“Europe's Single Market should be allowed to play its part, making sure that no borders re-appear on travellers' phone bills,” says José Manuel Barroso, President of the European Commission. “On seeing the latest price trends gathered by national telecoms regulators, I am particularly concerned by the high prices paid by consumers for text messages when they are travelling abroad. There is also a danger that European businesses are put off by non-transparent roaming costs for mobile data services. The Commission will closely work together with the European Parliament and the Council to find swift responses to Europe's data roaming problems.”
Commissioner Viviane Reding is even more forthright. She says:
“EU citizens should be free to text across borders without being ripped off. Roaming charges have already drained the wallets of mobile customers too much, especially the 77% of young people who send texts while using their mobile abroad. It is not a good sign for the competitiveness of Europe's mobile industry that it still hasn't got the message that credible price reductions are needed to avoid regulation. I will therefore recommend to my fellow Commissioners that we propose a regulation of SMS roaming in October. We will also have to discuss in which way to address data roaming, which continues to be heavily overpriced.”
According to figures from the European Regulators’ Group (ERG), the average cost of a roaming text message in the EU between October 2007 and March 2008 was €0.29 (£0.20), but could be as high as €0.80 for travellers from Belgium. ERG Chairman Dániel Pataki says the ERG feels a price cap between €0.11 and €0.15 per SMS would be appropriate. Prices for data services while roaming range from €0.25 per MB to over €16 per MB
The Commission has unveiled a new roaming website, showing the prices currently charged to consumers who use their mobile phone for sending text messages or surfing the web abroad in one of the 27 EU Member States.
The mobile operator’s trade body, the GSMA has, perhaps not surprisingly, reacted angrily to the plans.
“According to our analysis, the average price of SMS roaming services in the EU has declined by 18% in the last year, as operators launch new tariffs, allowing consumers to buy bundles of texts, as have proved so popular in domestic markets,” says Tom Phillips, the GSMA’s Chief Government and Regulatory Affairs Officer. “The Commission’s proposals to single out yet another aspect of the mobile industry and apply retail price regulation, threatens to choke growth and stifle competition.”
The GSMA points to the examples of operators that have introduced bundles of text messages for roamers, which can result in a price of €0.10 per message for those who make full use of their bundle, and to daily tariffs, that enable roamers to send messages for €0.15 each for for less than €1 per day,
“The Commission’s fixation with regulating common mobile prices across the EU is widespread,” says Phillips. “Different markets have inherently different costs, whether from variations in tax or, for example labour rates. These services should be priced based on local market conditions, not on some vision of a single Europe, originating in Brussels.”
On the other hand, Rob Barnes, Head of Broadband and Mobiles at moneysupermarket.com, has welcomed the move, saying:
“At last something will be done to reduce the extortionate text and data charges that holidaymakers face. Although ideally this should have been introduced last summer at the same time as the cap on calls, this is great news for anyone who uses their mobile abroad. However, it’s a shame the providers weren’t responsible enough to lower charges themselves so consumers could have saved this summer instead of having to wait for regulation. It will be interesting to see if providers try to recoup losses elsewhere as a result."

MMA Updates Best Practice Guidelines

The Mobile Marketing Association (MMA) has released version 3.3 of its 'U>S> Consumer Best Practices (CBP) Guidelines for Cross-Carrier Mobile Content Services'. Updated twice annually, the guidelines have become the baseline set of rules for cross-carrier mobile content services that include, but aren’t limited to, text messaging, multimedia messaging, shortcode programs, Interactive Voice Response (IVR) and mobile web.
The guidelines are produced by the MMA’s CBP Committee, whose mission is to develop guidelines which provide measures of acceptable and unacceptable practices for all players in the United States ecosystem.
Modifications to the July 9, 2008 Guidelines include the following key areas: use of wireless carrier SMTP gateways for commercial traffic; handset delivery; clarifications around promotional content and marketing to children; and the expansion and clarification of guidelines for Free To End User (FTEU), standard and premium rate messaging, mobile web and interactive voice response (IVR).
“The MMA’s Consumer Best Practices Guidelines are the rules for our mobile marketing industry in the United States,” says MMA President, Laura Marriott. “The guidelines provide carriers, technology companies, brands, media companies and consumer advocates with the baseline set of rules to ensure a consistent and protected experience for the consumer. “The guidelines have also become the rules which the industry monitors, and ensure compliance against today.”
The new guidelines also reflect contributions from CBP sub-committees, including IVR, Marketing to Children, Participation TV and Mobile Web. The sub-committees were formed to help facilitate the rapid development of the guidelines to ensure the MMA stays at the forefront of industry development and self-regulation.
The MMA Consumer Best Practices Guidelines Committee is comprised of the following member companies: Alltel Wireless, AT&T Mobility, Bango, Buongiorno, Cellfish Media LLC, Chapell & Associates, denuo Group (a Publicis Company), Jamster, Lavalife Mobile, Limbo Mobile, mBlox, MTV Networks, MX Telecom, Neustar, Nokia Corporation, OpenMarket, Qmobile, SinglePoint, Single Touch Interactive, Sprint-Nextel, Sybase 365, Telescope, The Walt Disney Company, T-Mobile USA, Twistbox, VeriSign, and Verizon Wireless.
The guidelines are effective immediately and are available for download here.

Operator Body Responds to EU Roaming Laws

The mobile network operators’ trade body, the GSM Association (GSMA),  has submitted its response to the European Commission’s public consultation on the functioning and the effects of the EU Roaming Regulation, which came into force on 30 June 2007. The EC launched the consultation on 7 May to satisfy its requirement to report to the European Parliament and the Council in 2008 about the functioning of the new roaming rules and their effects. Today is the deadline for submissions.
In its submission, the GSMA concludes that Europe’s mobile industry is cutting back spending on new networks and services as a growing regulatory burden from the European Union puts profitability under pressure. To justify the imposition of retail price caps, the European Commission has claimed that mobile operators are making excessive profits, but according to figures supplied in confidence by mobile operators to the GSMA, the European mobile industry’s return on capital employed (ROCE) was just 9% in 2006, compared with more than 20% in software, pharmaceuticals and several other sectors, according to management management consultancy, A.T. Kearney.
In its response to the consultation, the GSMA warns that European mobile operators, on average, are only just covering their weighted cost of capital, and says some of them are making an economic loss. A.T. Kearney estimates that ROCE for the mobile industry in 2007 was equal to or slightly lower than the 2006 figure.
The European Commission predicted that the introduction of regulated price caps on voice roaming calls last summer would lead to a major increase in usage, thereby offsetting possible revenue losses of operators. Yet A.T. Kearney calculates that, according to network operator data, voice roaming call volumes have increased by only 11% year-on-year to July 2008 while operators’ voice roaming revenues have decreased by 26%.
Historically, one of the leading investors in Europe, the EU mobile industry’s capital spending has slipped from 13% of revenue in 2005, to 12% in 2006, and 11% in 2007. However, says A.T. Kearney, heavy capital investment is needed to ensure the widespread availability of advanced 3G networks, which enable mobile users to access the Internet and other multimedia services at broadband speeds. It notes that while the mobile industry’s technology roadmap envisages further dramatic improvements in network performance and capacity, the speed of deployment of new networks may be constrained by the mobile industry’s relatively low level of profitability.
“Europe’s mobile industry is in the midst of another major investment cycle to deploy new services, such as mobile broadband, video downloads, mobile television and mobile email, which enhance Europeans’ daily lives and the economic competitiveness of the continent,” says Tom Phillips, the GSMA’s Chief Government & Regulatory Affairs Officer. “However, it is clear that the high level of investment required to provide these services across Europe won’t happen if regulators continue to distort the market by setting prices.”
In contrast to rising prices in other sectors, the average price of mobile services is falling rapidly, the GSMA says. In the EU25, domestic mobile voice prices fell by about 13% per annum from 2004 to 2007. Moreover, the average price of data roaming services in the EU fell by 25% in the 12 months to April 2008, while the average price of SMS roaming services fell by 18% in the same period. Recent announcements by individual operators suggest average prices will continue to fall and the GSMA believes there is no need for the European Commission to also introduce price caps on these services.
“The Commission built its case for roaming regulation on two flawed arguments,” says Mark Page, a Partner at A.T. Kearney. “Sharp price cuts have not been offset by a corresponding increase in the volumes of calls; and the mobile industry does not earn exceptionally high profits, which could offer a buffer against the loss of revenues. These are the facts to counter the Commission’s assertions and anecdotes. We can only hope that they look at the full body of evidence as they consider the future of the roaming regulation.”
A full copy of the GSMA’s response to the European Commission’s public consultation on the voice roaming regulation, will be available later today here.

Mediaburst Offers Best Practice Guide

Mobile marketing firm Mediaburst has developed a best practice guide to using phone-paid services, which is available for downloading from the company's website. Mediaburst has also announced the appointment of Dawn Hedley as its Compliance Officer.
The guide aims to help brands and agencies to establish a culture of compliance in SMS promotions, helping the advertising and marketing industries to fully understand the dos and don'ts of mobile marketing campaigns. The guide, which has been reviewed by telecoms regulator PhonepayPlus, can be downloaded here.
Hedley joined Mediaburst in December 2003 as Operations Manager. Previously, she was production manager for Centurian (now known as Redactive) where she was responsible for budget management, print buying, quality control, workflows, scheduling and delivery of publications.
As Mediaburst's Operations Manager, she helped develop the company's web-based SMS communication products, and introduced billing mechanisms and service level agreements, as well as processes for testing, sales orders, incident management and frontline support to business partners such as O2 and Thus.
“Brands today face a challenge keeping up with the complex regulations surrounding phone-paid services,” says Hedley. “Mediaburst's best practice guide will help brands and agencies alike to create compliant mobile marketing promotions, avoid costly investigations and build confidence with the consumer.”
Dawn Hedley is available for agency and brand briefings upon request. To book one, email [email protected]

Adaptive Urges Action On Illegal Mobile Content

AdaptiveMobile, which provides mobile subscriber protection for enterprises and individuals, has urged mobile operators worldwide to follow the example led by the United States, where this week three of the largest Internet Services Providers (ISPs) - Verizon, Sprint and Time Warner Cable - committed $1 million (£500,000) to help block access to explicit child sites and bulletin boards, marking a first move of ISPs giving into government pressures of 'policing' the Internet.
“This is a real step in the right direction to combat the growing presence of illegal and exploitative child content online,” says AdaptiveMobile CEO, Lorcan Burke. “However, it is crucial that these efforts are extended into the mobile environment, which has seen major growth in illegal content globally over the last year, as the number of mobile subscribers accessing the internet via their phones continues to rise rapidly.
“The US has taken a critical first step to block access to exploitative child content on the Internet, and we call for service providers worldwide to take a similar approach to eliminate this content on mobile devices as well as PCs. There has been an ongoing discussion about responsibilities between governments and ISPs in recent years in many countries, with ISPs resisting the need to 'police' the Internet with the argument of freedom of expression. However, the story with illegal images of children is black and white: it is immoral, illegal and needs to be stopped.
“Protecting children and stopping the proliferation of this material needs to be a global effort, with service providers at the helm. By not taking mobile into account, however, the industry risks seeing a ‘platform jump’ in which these sites move onto mobile. We encourage mobile service providers to extend these blocks and to involve groups that have an in-depth knowledge of these threats to children, such as the Internet Watch Foundation (IWF). Many adult sites are already being accessed using mobile technology - I can only hope that this doesn't accelerate the trend to include illegal content by forcing if off of the PC.”   
AdaptiveMobile's parental controls are already being deployed by a number of mobile phone operators worldwide. This enables them to safeguard their infrastructure and deliver appropriate controls, ensuring a safe mobile experience for teenagers and children. It’s Policy Control Framework sits on the network and protects subscribers against illegal or inappropriate content, unsolicited or unauthorised communications. It works across all mobile services, including WAP, SMS, MMS and email; all forms of access (mobile, wi-fi, WiMax); and media, including mobile iInternet, text, images, music, voice and video.

MEF Event Looks At Regulation

The Mobile Entertainment Forum (MEF) is staging a one-day seminar entitled: ‘Regulation of Premium Mobile Content Services – What’s on the horizon?’ on 5 June in London.
The event has been organised by the MEF EMEA chapter and the Mobile Data Association (MDA), with support from PhonepayPlus, and takes place at the Royal Statistical Society. It will look at how the latest legislation will affect premium rate services; what are the hottest new business models in mobile entertainment; how is the market performing today; and what does the future look like?
Speakers include Claudio Pollock, Director of Consumer Policy at Ofcom; Cliff Young Head of Lotteries at the Gambling Commission; Iain McCallum, Head of Interactive Messaging at O2; Paul Goode, SVP Business Development & Senior Analyst at M:Metrics; Andrew Bud, Executive Chairman, mBlox and  Chairman of the MEF; and George Kidd, Chief Executive of PhonepayPlus.
The event costs £75 to MEF and MDA members, £150 to non-members, including lunch and refreshments. To register for the conference, email [email protected]

Starhome Granted Patent for Home Short Code Solution

Starhome, which provides roaming services and converged solutions, has announced that it has been granted a US patent (US patent No: 7,356,337) for an innovative solution for home shortcode resolution. The new technology, for use by mobile subscribers while roaming, enables shortcode numbers to be translated on the handset in order to drive a higher call completion rate and to increase user satisfaction.
Currently, when roaming, home shortcodes (short dialling sequences used by subscribers on the home network) are either supported by the visited network, remotely by the home network, or in many cases, not supported at all, resulting in uncompleted calls and lost revenues. Starhome’s technology implements shortcode translation on the mobile handset, enabling worldwide support of home shortcodes, in any roaming network, regardless of the visited network capabilities.
The core technology covered by the patent will extend the coverage of Starhome's ‘Home Short Code’ service, which provides roamers with access to home-based Value Added Services (VAS), with the same shortcodes they use at home. Voicemail, customer service, directory assistance and other services are made available via shortcodes on the visited networks that temporarily "adopt" roamers. This offers them easy access to VAS using Starhome's unique global database of short codes, which is continuously updated.
In this way, says Starhome, the Home Short Code solution enables operators to increase their revenue from both the inbound and outbound roaming market, through an innovative solution which requires minimum technical resources and investment. Home Short Code is completely secure, to prevent fraud and voicemail hacking.
“This patent affirms Starhome’s position as a leader in roaming technologies and as a leader in wireless technologies,” says Starhome VP of Marketing, Orly Nesher. “Starhome is committed to delivering solutions which not only provide users with a seamless experience but also enable operators to maximise revenues delivering a fast ROI.”
The newly issued patent is a further milestone in Starhome’s knowledge portfolio which includes, amongst others, 12 registered patents, such as those related to Starhome’s ‘Intelligent Call Assistant’ solution and ‘Virtual Home Environment’ solutions, as well as 65 pending applications for Starhome’s technology and services in various jurisdictions worldwide.

Ofcom Gives O2 the All-clear

Telecoms regulator Ofcom has confirmed that mobile operator O2 has now met its obligation to roll out its 3G services to at least 80% of the UK population. This follows Ofcom's notice to O2 in February that it would shorten its licence by four months if it did not comply with its rollout obligation by 30 June 2008. O2 acquired its 3G licence in 2000 for £4,030 million. Ofcom estimated that a reduction of the licence term by four months would have been equivalent to a significant financial sanction of at least £40 million.
The rollout obligation requires each of the five holders of a 3G licence to roll out their networks to enable the provision of 3G services to at least 80% of the population from 31 December 2007. The other four licensees, H3G, Orange, T-Mobile and Vodafone, demonstrated that they were in compliance with this obligation on this date.
Ofcom says that it will conduct a further assessment to ensure that these licensees remain in compliance on 31 December 2008.

Ofcom Proposes PRS Rule Change

Communications regulator Ofcom has proposed new rules to tighten the regulation of television and radio programmes that rely heavily on premium rate telephone services (PRS). The proposed new Broadcasting Code rules will ensure that programmes that invite viewers and listeners to interact or participate are not vehicles for promoting commercial, revenue-generating services. In addition, the rules will ensure that viewers are adequately protected,  and that advertising is kept separate from editorial content, as required under European legislation.
The new Broadcasting Code rules state that:
Where PRS is used in a programme for audience participation, it must not be given undue prominence within the programme.

The programme must consist primarily of content other than the promotion of the PRS.

The primary purpose of the programme must be editorial, and any commercial activity associated with the PRS, such as generation of call revenues, must be secondary to that purpose.

Broadcasters may only charge viewers via PRS call charges and not by other means, such as credit card or direct debit.

The new rules take into account the judgement made by the European Court of Justice in October 2007 that a quiz TV show could be classified as teleshopping. Ofcom says it considers that the principles of this case should apply to other types of programmes. If adopted, the proposed rules will apply to both radio and television but will be particularly significant to Participation TV services.
Ofcom says that these services will either need to ensure that they comply with the new Broadcasting Code rules and therefore remain classified as editorial services, in which case quiz, psychic and adult chat TV, as currently broadcast, will need to change significantly in order to comply. Alternatively, these programmes types will need to be reclassified as teleshopping, in which case they will be subject to advertising minutage rules and the BCAP (Broadcast Committee of Advertising Practice) Advertising Standards Code, enforced by the Advertising Standards Authority. However, says Ofcom, services which fall into a prohibited advertising category, such as adult chat on unencrypted channels and psychic practices, cannot be broadcast as teleshopping. This means that, unless such services change to comply with the new Broadcasting Code rules, they can no longer be broadcast.
“The new rules mean these channels face a much tougher regulatory regime which they must comply with,” says Ofcom Chief Executive, Ed Richards. “Ofcom will ensure that programmes only use premium rate telephone lines where there is sufficient editorial justification. This will further distinguish between television advertising and editorial content for the benefit of viewers."
The deadline for responses is 22 May 2008. You can see the full statement, ‘Participation TV Part 2: keeping advertising separate from editorial’, here.

EC Keeps Watching Brief on Mobile Content Safety

Mobile operators serving 550 million customers in the European Union are putting in place safeguards to ensure that children can safely access content on mobile phones, as part of a programme coordinated by GSM Europe,  the European arm of the GSM Association.
One year after the introduction of GSM Europe’s European Framework for Safer Mobile Use by Younger Teenagers and Children, self-regulatory codes of conduct are now in place in 21 countries of the European Union. GSM Europe expects similar codes to be introduced in the remaining six countries of the EU, as 24 mobile operators and content providers covering all the Member States have signed the framework.
The framework sets out a number of measures, such as access control mechanisms, classification of commercial content, and the raising awareness and education, which operators should implement to ensure that children can safely access content on their mobile phones.
“As mobile broadband networks proliferate, enabling Europeans to easily access a rich selection of content via their handsets, our industry is moving in a timely fashion to ensure the necessary safeguards are in place to enable parents to have confidence in their children using these mobile services safely,” says GSM Europe Chair, Kaisu Karvala.
Viviane Reding, EU Commissioner for Information Society and Media, says that  GSME and European mobile operators should be congratulated for the work they have done so far in trying to establish national codes of conduct for safer mobile use by children and young people, but says that more needs to be done.
“Mobile operators have taken an important step towards making online technologies safer for children and enhancing transparency,” she says. “In some countries, there is, however, still substantial work to be done to ensure that these principles are really put into practice. I will continue to follow this very closely, because practical measures and concrete implementation are what really matter to children and their parents. I strongly encourage mobile operators to cooperate in this implementation process with non-profit organisations and other stakeholders engaged in child safety. I will come back to this issue this autumn to see whether further measures by the Commission are required.”
The mobile industry is calling on EU policy-makers to provide support in achieving the objectives of the framework, in particular, the development and distribution of educational material to teachers and parents.

Europe

’s mobile operators will also regularly review the national codes of conduct to ensure they remain fit for purpose.

MMA Addresses Best Practice Issues

The Mobile Marketing Association (MMA) recently held its Consumer Best Practices (CBP) Industry Forum in Denver, Colorado, hosting more than 140 delegates. The event was led by the MMA’s Consumer Best Practices Committee, which is comprised of leading mobile operators, aggregators and content providers, and addressed topics that will be at the forefront of the industry for the coming year. Topics of discussion at this year’s event included Multi-media Messaging (MMS); adult content and age verification; binary free content downloads; user-generated content and communities; marketing to children; location-based services; and compliance (monitoring and health measurement).
The MMA Consumer Best Practices Guidelines Committee is comprised of participants from the following member companies: Alltel Wireless, AT&T Mobility, Bango, Buongiorno S.p.A., Chapell & Associates, denuo Group (a Publicis Company), Jamster, Lavalife Mobile, Limbo Mobile, mBlox, Inc., MMA, MTV Networks, MX Telecom, NeuStar, Inc., Qmobile, Inc., SinglePoint, Sprint, Sybase 365, Telescope, Teligence, The Walt Disney Company, T-Mobile USA, Twistbox Entertainment, VeriSign, Inc. and Verizon Wireless.
The MMA's Consumer Best Practices Guidelines were published in December 2007 and are updated twice a year. The most recent version of the guidelines can be viewed here.

MMA Updates Best Practice Guidelines

The Mobile Marketing Association (MMA), which represents more than 500 member companies worldwide, has released the latest edition of its Consumer Best Practices (CBP) Guidelines for cross-carrier mobile content services in the United States. The MMA says the Guidelines, updated twice annually, have become the baseline set of rules for cross-carrier mobile content services in the United States. The Guidelines can be downloaded here.
The guidelines are produced by the MMA's CBP Committee, whose mission is to develop and continually update a cross-carrier code of conduct that balances consumer protection with the revenue opportunities. The guidelines provide measures of acceptable and unacceptable practices for all players in the ecosystem to follow for cross carrier messaging, interactive voice response (IVR) and mobile web services in the US.
“The success of a mobile marketing campaign is measured largely by the user experience," says Chris Black, Director of Mobile Marketing at AT&T Mobility, and Co-Chair of the CBP Committee. “By representing a cross-section of carriers, technology companies, brands, media companies and consumer advocates, the CBP Committee is uniquely qualified to provide the level of timely, hands-on guidance that the industry needs as the mobile channel grows."
Highlights of the December 2007 CBP Guidelines include guidelines for free-to-end-user (FTEU) guidelines for messaging services; sweepstakes and contests; mobile web and Interactive Voice Response (IVR) opt-in and billing modifications; affiliate marketing; and participation TV.
“The CBP have been instrumental in creating a play book for cross carrier services in the United States," says  Laura Marriott, MMA President and Co-Chair of the CBP Committee. “We applaud the efforts of all in our industry in creating a model which will be replicated in markets around the globe.”
The new guidelines also reflect contributions from new CBP sub-committees, including IVR, Marketing to Children, Participation TV and Mobile Web. The sub-committees were formed to help facilitate the rapid development of the guidelines to ensure the MMA stays at the forefront of industry development and self-regulation.
The MMA Consumer Best Practices Guidelines Committee is comprised of the following member companies: Alltel Wireless, AT&T Mobility, Bango, Chapell & Associates, denuo Group (a Publicis Company), Jamster, Lavalife Mobile, mBlox, Inc., MMA, MTV Networks, MX Telecom, NeuStar, Inc., Qmobile, Inc., SinglePoint, Sprint Nextel, Sybase 365, Telescope, Teligence, The Walt Disney Company, T-Mobile USA, VeriSign, Inc. and Verizon Wireless.
The MMA will host its annual CBP Industry Forum in Denver on 16 January 2008. The Forum provides the opportunity for participants to comment and input into the guidelines and best practices for the mobile marketing industry in the United States. 

MEF Launches AMS Directive Guide

The Mobile Entertainment Forum (MEF) Europe has launched its guide to the AMS (Audiovisual Media Services) Directive at a members' workshop with the Department for Culture, Media and Sport (DCMS) and Ofcom. The MEF’s ‘Practical Guide' aims to help the many mobile entertainment companies affected by the Directive understand both its impact, and the potential opportunities it will create across the single market. The guide was compiled by the MEF's European chapter in partnership with leading international law firm, Denton Wilde Sapte.
This new legislation will update and replace the existing Television without Frontiers (TWF) Directive, which currently provides the regulatory framework in the EU for the television and broadcast industry. Under the AMS Directive, existing rules for traditional TV will be enforced for mobile multimedia services, including mobile
television broadcasting (linear) and video on-demand (non-linear) services.
The guide, which has also been translated into French, German and Italian, is now available on the MEF website. (www.m-e-f.org) It provides practical information on how the Directive is set to affect businesses and services. The Directive aims to harmonise conflicting rules which currently apply in different member states. These changes should allow mobile companies operating across Europe to more fully exploit opportunities across the single market.
The AMS Directive has been approved by the European Parliament and will be adopted by the end of 2007, after which member states have two years to pass legislation bringing the AMS Directive into force at a national level. The DCMS is the Government department responsible for this in the UK and will be holding a series of stakeholder meetings to confer with the industry during this process.
“The mobile entertainment industry value chain is at the cutting-edge of the drive
towards a converged media environment, says Denton Wilde Sapte Partner, Ingrid Silver. “ The AMS Directive represents a huge shift for the industry into being a harmonised, legislative environment. This will have ramifications for businesses of all sizes, particularly if they intend to have an advertising, sponsorship or product placement element to their TV or TV-like business models."
According to an MEF-based survey conducted in October 2007, over 50% of the mobile entertainment business is likely to be affected by the Directive.
“When implemented, the AMS Directive will place a number of new guidelines on companies operating in the mobile sector providing audiovisual content services,
particularly in relation to advertising and sponsorship,” says MEF Europe Chair, Gerard Grech. “This guide is therefore timely in providing strategic regulatory guidance and advice on the possible impact and opportunities the Directive creates for all involved in the mobile audiovisual value chain.”

DMA Urges Bluetooth Caution

The Direct Marketing Association (DMA) is urging marketers to exercise caution when considering the permission implications of Bluetooth following the Information Commissioner’s Office’s (ICO’s) recent decision to exclude Bluetooth from its guidance on compliance with the Privacy and Electronic Communications Regulations (PECR). 
The DMA says it has always felt that the spirit of the PECR, in terms of permission and control, should apply to any electronic messaging medium. The DMA Mobile Marketing Council’s Best Practice advice reflects this and, to this extent, the DMA believes that the ICO’s decision is not material to such Best Practice advice. The ICO has reasoned that Bluetooth, as a local transmission technology, does not use a public electronic communications network and so is outside of the scope of the PECR.
Nick Fuller, chair of the DMA Mobile Marketing Council, says:
“The fact remains that Bluetooth may now be in a ‘no man’s land’, especially since the technology itself precludes the ability for a consumer to give permission before an advertiser sends a message (the only possible exception being the pairing of devices – an impractical step for commercial messaging).   
“Whilst it is understandable that the ICO sees Bluetooth as falling outside of the PECR legislation in terms of its underlying technology, it is important that the principles of the PECR are not lost. I am increasingly speaking to Bluetooth marketers who appreciate the principle of permission and who approach potential applications accordingly, but it would be naive to assume that this will always be the case. We recommend to our members to err on the side of caution when considering the permission implications of Bluetooth. We would certainly like to have a more definitive legislative position. However, the question remains as to under whose auspices, now that it is not the ICO's.”

Baby You Can Spam My Phone

Bluetooth marketing is in the news again, following the Information Commissioners Office’s decision to update its guidance for marketers on the Privacy and Electronic Communications Regulations 2003. The updated guidance removes Bluetooth from the list of communication methods that require the user’s opt-in permission.
There has long been debate about whether Bluecasting, or Bluespamming as opponents of the practice prefer to call it, is legal or not. This ICO’s decision looks set to settle the debate once and for all, but it is also causing concern among industry bodies and others concerned with privacy issues.
Nick Fuller, Chair of the Direct Marketing Association’s Mobile Marketing Council, issued a statement which read:
“Whilst it is understandable that the ICO sees Bluetooth as falling outside of the PECs (Privacy in Electronic Communications) legislation in terms of its underlying technology, it is important that the principles underlying the PECS are not lost…We recommend to our members to err on the side of caution when considering the permission implications of Bluetooth, but we would certainly like to have a more definitive legislative position. The question is under whose auspices now that it is not the ICO's.” 
Others are concerned that the ICO’s decision may open the floodgates, and encourage brands that have looked at, but ultimately shied away from, Bluecasting, to take the plunge, creating an environment where mobile phone users will be bombarded with Bluetooth messages when they walk past shops, bus stops and billboards.
You can see more coverage of this issue, and join in the debate, here.
And you can view the latest version of the ICO guidance, updated at the beginning of October, here.

Regulatory Framework Needed, says Davies

Million 2-1 Director Scott Davies has told Mobile Marketing that the Ofcom report into premium-rate phone line scandals, released yesterday, makes clear the need for a clear regulatory framework for the premium rate industry.
The report found that found some broadcasters were “in denial” about their responsibilities, and revealed a “systemic failure” to comply with rules. In particular, the report suggests that there is a critical lack of transparency in the relationships between service providers, producers and broadcasters, leading to a lack of clarity about legal responsibilities.
“Many of the recommendations in Ofcom’s report are based around having legally compliant systems, processes and audit trails” says Davies. “This is the first of two ticking bombs that will affect the premium rate/broadcast industry. Firstly, the report highlights problems with the regulatory framework, something that Million 2-1 has been talking about for the past six months. There is clearly a need for a clear regulatory framework that defines roles both between ICSTIS and Ofcom, and sets out the responsibilities of broadcasters and service providers, so that no confusion exists and the kind of scandals that we’ve seen in the last six months could not happen.
“Secondly, the forthcoming Gambling Act that is due to come into force in September 2007 will re-define many  premium rate formats as ‘games of chance’ and therefore make the operation of them by broadcasters and service providers illegal, unless they have an External Lottery License. 
“As a lottery licence holder, we welcome regulation and the forthcoming Gambling Act, since it is expected that much of the confusion around premium rate competitions and quizzes will be dealt a final, clarifying blow when it comes into force in September, giving a real opportunity to return to high revenue streams and customer confidence.”