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Tough options for telecom operators over promos

By Emeka Aginam & Emmanuel Elebeke
For telecoms operators who engage consumers  in lotteries in disguise of sales promotions, it may not be business as usual again as the regulatory authorities, the National Lottery Regulatory Commission; (NLRC)  in conjunction with Consumer Protection Council, (CPC)  have threatened to sanction them, insisting that 50% of proceeds from any promo should go back to the consumers who participated.


This is coming on the heels of endless promos by telecoms operators where consumers are urged through SMS to participate in sales promotions with the condition of sending airtime worth of some amount to a short code to qualify for entry.

While frowning on what it described as  a game of chance in the name of sales promotion,  the  Assistant  Director, Enforcement & Compliance of National Lottery Regulatory Commission, Barrister Osa Uwadiae who spoke last week in Lagos during the 55th edition of the Telecoms Consumer Parliament organized by the Nigerian Communications Commission, NCC, told the parliamentarians that there has to be a line between lottery, reward and sales promotions being  run by various service providers in the telecom market.

Uwadiae,  while noting  that consumers have the right to be protected against fraudulent, misleading and deceitful information,  advertisement or promo,  told the parliamentarians that on no account should telecoms operators claim  that they are rewarding customers in the name of promo whereas  they are ripping them off.

“Once this is the case, the National Lottery Regulatory Commission will get interested,”  he noted.
“What is real reward, promotion? Our concern is that you do not tell customers that you are rewarding them when you are ripping them off by engaging them in a game of chance. You do not expect customers to load their phones to reward them. In the promo, it is expected that the telecoms operators disclose the information regarding how many people won, how many participated and what percentage went back to the participants,” he said,  adding that it is the consumers’ rights to receive clear and complete terms and conditions for agreements in any service.

“Operators should not tell customers they are rewarding them when they are doing sales.  A reward scheme should not  have entry requirements. You do not have to tell a consumer to  load certain amount of money with certain code to qualify  for a particular scheme. What many service providers are doing is a game of chance.

They lure customers through unsolicited text messages to enter into sales promotion. If  any operator engages in lottery in the name of sales promotions, the National Lottery Regulatory Commission  will get interested. We are more  concerned when a reward scheme becomes lottery in the name of  promo. That is the truth of the matter. We are concerned on transparency in any sales engagements” he told the parliamentarians.

For Mr B.A Adeyinka of Consumer Protection Council, (CPC) telecoms consumers need to differentiate between sales promotions and reward schemes, stressing that enough is enough with respect to various sales promotions by telecom operators geared towards reaping off consumers.

“We do not accept as a reward scheme for customers when you ask them to pay premium rate to enter for a promo. Consumers should not pay something to get something. We want to ensure that reward should not attract any form of payment through SMS. When you bring in an element of chance into a promo, it is no more a reward. This is where it bothers us. This is where we will get involved, ” she said.

But reacting to the trend which many regarded as gambling, the Executive Vice-Chairman of the Nigerian Communications Commission, (NCC), Engr. Ernest Ndukwe without mincing words urged operators to draw a line between sales promotions and reward schemes which every consumer is entitled to without necessarily paying anything to get something.

“There has to be guidelines on sales promotion. The guideline on promo will soon be out. Operators should never tell consumers that they are rewarding them when they are doing sales promotion. That has to stop. Reward scheme should not have entry requirement. It has to be part of the loyalty scheme. Multiple regulation may be a source of confusion. Our business at NCC is to regulate service provision and not sales promotions but the  NCC, CPC, Lottery Commission will meet to look into who regulates what. Operators should have a code that can allow a consumer not to receive unsolicited SMS.

The 55th edition of the  monthly Telecom Consumer Parliament with the theme, ‘Problems and Prospects of ICT Promotions’ afforded the telecom consumers the opportunity to ask questions on service delivery by the service providers.


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