'Customers don't want our new data bundle product,' says MTN

Cellphone network giant MTN says it has decided to no longer introduce and auto renew data bundle.
Cellphone network giant MTN says it has decided to no longer introduce and auto renew data bundle.
Image: Siphiwe Sibeko/REUTERS

MTN said on Friday that it has decided to back down on its plan to introduce an "auto renew" 1MB data bundle when their subscribers' bundles run out - unless they proactively opt out.

"Our customers have made it clear that they do not want the automatic bundle option and we have therefore taken the decision not to implement the change," the network said in a statement.

What the network punted a week ago as a consumer-friendly solution to subscribers running out of data mid-session was widely condemned as flouting the Consumer Protection Act's outlawing of negative response marketing and a sinister exploitation of a loophole in the Independent Communications Authority's data regulations.

A week ago, Tech Central author Andrew Fraser accused MTN of misusing a small compromise that Icasa offered to the networks - that they could continue the session after the bundle was depleted, as long as they continued to charge in-bundle rates - in order to continue their previous method of billing for out-of-bundle data.

"Unfortunately it seems that Icasa failed to define what they meant by 'in-bundle' rates," he said.

"Any reasonable person would expect those rates to be equivalent to the rates of the bundle that had just been depleted - for example a 1GB bundle that sells for R150 has a per-MegaByte price of 15c -  but this is not explicitly defined, and MTN has decided that it could mean the price of ANY data bundle.

"So they've created a new bundle of 1MB at a price of 40c, and are going to implement this as the price for data that is automatically supplied after customers' bundles are depleted."

And on top of that, Fraser said, the network had decided that this would happen automatically unless their customers specifically opted out.

Consumer Goods and Services ombudman Magauta Mphahlele said this week that she could find no clause in Icasa's end user subscriber service charter that allows a consumer to be defaulted into out-of-bundle or any other charge if their data depletes.

"In my opinion the 'auto renew option' which defaults you into the 40c bundle is not in compliance with the regulations, even with the option to opt out," she said.

"I understand the need for MTN to be innovative in ensuring their customers have  a seamless data usage and convenience, but in this case the auto renewal option is taking us back to before the above regulations were issued where consumers were defaulted into out of bundle charges."

MTN SA's consumer business unit executive, Mapula Bodibe, said on Friday the network had intended to "provide our customers with user-friendly solutions, off our world-class network, in a manner that best connects them to their daily lives".

"We remain committed to compliance and respect both the intention and spirit of the regulations and laws that govern our sector and we have also heard the concerns raised by our customers in response to this proposed offering.

"Our customers have made it clear that they do not want the automatic bundle option and we have therefore taken the decision not to implement the change."

All MTN customers who have not actively chosen to opt into out-of-bundle usage remain blocked from using out-of-bundle data.

On Friday, the network implemented "an improved and simplified" out-of-bundle menu - on the USSD short code *135*6# - offering customers the choice of either opting in or opting out of out-of-bundle usage.

They can block and unblock this functionality as they choose.


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