- The Consumer Council welcomes OFTA's efforts in addressing this issue of consumer concern.
- The Council notes that OFTA's report on this matter states that competitors are unable to compete on a level playing field because of the lack of a more open tender process, and because the bundling of telecommunications services with management fees effectively raises the price of competitors' services vis a vis the prices being offered by the bundled service provider (paragraph 4 of OFTA's Executive Summary refers).
- OFTA also noted that 'although the conferment of the advantages had arguably placed other operators at a significant disadvantage, OFTA has no jurisdiction under the Telecommunications Ordinance over the conduct of non-telecommunications licensees' (paragraph 6 refers). The report has therefore raised issues regarding possible limitations of the sector specific nature of telecommunications regulations, which may suggest that a broader regulatory framework would be beneficial to the economy (paragraph 70 refers).
- The Consumer Council shares OFTA's concerns. It also notes that Banyan Garden is a new development and purchasers of units who have previously acquired telecommunications services from another operator will be bound by those existing contracts. Hence, they will have to pay for another telecommunications service pre-determined for them and charged through the bundled management fee.
- The Council has also received complaints from consumers regarding management companies bundling telecommunications services with management services under one management fee in estates other than Banyan Garden. Accordingly, it would stress that the issue of bundling telecommunications services with management fees needs further detailed scrutiny not merely within one estate.
- The immediate and crucial question that arises is what impact bundling has on consumers and on the competitive environment that consumers currently face in regard to the choices they have for the subject telecommunications services.
- The report also highlighted section 19B of the Telecommunications Ordinance which would have the effect of voiding any contractual terms that unreasonably restrict the right of residents to have access to the telecom services of their choices. While unable to take direct action himself under this provision, the Telecommunications Authority has described in the report what he considers to be relevant considerations in this respect (paragraph 110 refers). The Council finds this to be very useful.
- The Council is also concerned that purchasers might not fully understand the statements made by developers in their sales brochures with regard to arrangements for access to telecommunications services. They might be under the impression that the property development only offers a portal for internet/broadband service to facilitate the purchasers' own choice of suppliers.
- Given the complexity of OFTA's report, the Council will examine these and other issues closely and produce a more detailed response for public consideration.
- Consultation Papers
- 2004.08.11
