MDA steps in on pay-TV war

Amidst rising content costs, a new rule has been proposed to better protect consumers. Last week it was announced during parliament that a new rule was being considered to heed complaints from the public about pay-TV operators.

In a statement to Marketing, the Media Development Authority(MDA) said it was considering making the following changes:

-Allow in-contract subscribers to exit contracts without exit penalties, where the change is of detriment to subscribers;

-Disallow practices of retailers that require subscribers to upgrade in-contract non pay-TV services to make changes to pay-TV services;

-Require retailers to bring to subscribers’ attention certain important terms before the signing of contracts.

A spokesperson from MDA said the changes arose because most standard consumer contracts are often long and drafted in legal language that may not be easy to understand for the consumers. The MDA also added that that recent feedback has indicated that there may be a need to increase consumers’ awareness, particularly on the expiry of promotional prices and complimentary content.

“Some consumers may overlook important terms, especially if these are not explicitly brought to their attention,” the MDA statement said.

As a general principle, MDA does not intervene in consumer contractual matters in the media market. However, where there are increasing concerns over specific unfair practices, MDA would review the need for intervention.

Recently, complaints from the public arose due to operators removing channels or programmes and imposing higher fees.

Just last week when Singapore Telecommunications (SingTel) secured the rights to bring the 2014 FIFA World Cup Brazil to all television and mobile screens in Singapore, it simultaneously announced its new pricing plan. Those who wished to enjoy the matches without committing to a contract with SingTel's mio-TV would have to pay a hefty price of SG$105.

Consumers Marketing spoke to also voiced their unhappiness on the price hike. (Read also: Is SingTel’s pricing for World Cup 2014 a sneaky marketing move?)

While SingTel was not able to comment on if or not the new rule would impact its marketing activities and hold on market share, StarHub said its TV customers have always had the choice of enjoying the service on a month-by-month basis, or to take up a longer term contract to enjoy special discounts or gifts.

“It is worth noting that when we made adjustments to our pay TV packaging last year, StarHub TV customers who were tied to contracts then had no change to their subscription plans until their contractual periods ended,” a spokesperson from StarHub told Marketing.

MDA also added that there have been instances of retailers requiring subscribers to upgrade their in-contract non pay-TV services, for example broadband service, when they wanted to change their pay-TV services.

“These upgrades are typically not necessary to support the changes in the pay-TV services,” it said.

Currently a public consultation on the proposed changes will be scheduled to be held in April 2014. Details of the proposed changes would be set out in the public consultation document which will be released then.