Telcos may be forced to display information on customer service

Tuesday, 13 December 2022

Spark, Vodafone, 2degrees and other large telcos and internet providers may need to prominently display how they have been ranked in customer service surveys, on their websites and in their stores.

Telecommunications commissioner Tristan Gilbertson said the move could help address the paradox that the performance of the country’s broadband and mobile networks had “gone from the back of the OECD pack to the front of the pack” in 10 years, but consumer complaints were persistently high.

“We've decisively closed the gap with the OECD in terms of technology, but we now have a new gap that needs to be closed,” he said.

Gilbertson said he got the idea for making telcos front up on their customer service records when he nipped to a branch of NatWest bank in London a few years ago to withdraw some cash.

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“As I walked past the window, something caught my eye,” he said.

That was a poster displayed by the bank that ranked its customer service in four different areas against its 16 major competitors.

Britain’s Competition and Markets Authority (CMA) began ordering UK banks to prominently display survey results on their service quality in 2016, after finding consumers had limited information on which to base decisions when they shopped around for a bank.

The Commerce Commission issued a discussion document on Wednesday setting out how New Zealand telcos could be persuaded or pressed into following suit.

The watchdog envisages surveying about 400 consumers and 200 small businesses each month on their satisfaction with their telcos and updating the results twice a year.

The survey would focus on the two questions most important to customers, Gilbertson said.

These were their satisfaction with the speed at which the companies had resolved their issues and the helpfulness and knowledge of their staff.

Gilbertson said one of the questions on which the commission was consulting was whether the reporting system would need to be mandatory, or whether telcos would voluntarily comply.

Either way, they would need to display the survey results in the form of a “dashboard” prominently in store and on their websites for the proposal to work, he said.

“Like the CMA, we want providers to stick this stuff in the front window.”

One option might be for the reporting regime to initially be voluntary while any fine-tuning took place and then mandatory, he said.

Vodafone spokesperson Matt Flood said it would be considering the commission’s proposals.

“It is important to ensure that any interventions in the telco retail market are practicable, are grounded in the reality of this market – not unrelated markets with different issues – apply to all market players and deliver good outcomes for consumers,” he said.

2degrees chief marketing officer Zac Summers said it was supportive of moves that helped consumers make informed decisions when choosing a provider.

“We’ll work closely with the commission and the industry to make sure this approach fits the bill, and provides a useful snapshot for consumers,” he said.

Spark has also been approached for comment.

Gilbertson said the initiative was “an opportunity to really make a difference at long last in a really important area for consumers”.

As well as providing them with information, it would send “a much clearer signal to telcos that they just need to up their game in the space”, he said.

To ensure the results of the customer service surveys were statistically significant, the commission envisages it would only report on telcos that had at least a 5% share of the broadband or mobile market, either among consumers or small businesses.

That would mean it would cover at least five mobile brands and at least 10 broadband providers, it said.

Gilbertson acknowledged smaller internet providers might have concerns about being excluded from the dashboards, particularly if they were seeking to differentiate their offering from larger competitors through superior customer service.

But he said the commission needed to start somewhere.

“One thing we are asking for in the consultations is for views, particularly from smaller operators who might have those sorts of concerns, about ways in which their data could be folded into the programme over time.”

The commission also wanted telcos and internet providers to provide it with the key customer-service metrics they gathered, such as their call waiting times, Gilbertson said.

It would use that information, the customer survey, and complaints data to publish separate reports every six months that would complement the customer service dashboards.

Those reports would give consumers the ability “if they want, to lift the lid and look at individual performance in specific areas at a much more granular level”, Gilbertson said.

The commission would start off with a voluntary request to telcos to supply that information, he said.

It is inviting submissions on the proposals by February 28.