Telstra lays out true cost of service plans

Telstra has started providing customers with a "summary of offer" document laying out the true cost of taking a new telecommunications service, with at least two more telcos set to follow suit.

In a plan agreed to by industry and coordinated by the Communications Alliance, a summary document would be presented to new customers online or at the point of sale in lieu of fine print that was normally worked into advertisements.

Telcos argued that fine print was ineffective at educating the customer about the true costs of a plan.

The summary included information on the monthly access price, additional charges, plan inclusions and exclusions, contract length, exit fees, termination dates and eligibility requirements.

In public submissions to the Australian Communications and Media Authority's (ACMA) Reconnecting the Customer inquiry, Telstra said it provided the summary in-store, on its website and by mail to customers who requested more information.

Other telcos, including Primus and Vodafone Hutchison Australia, indicated they would release similar summaries in future.

However, telcos tussled over whether the summary would be presented at every customer interaction - including those over the phone - and whether it would lead to "disclosure fatigue" for the customer.

"In some cases, the customer may already have done their research online or gone in-store to obtain a summary of offer for the plan they are interested in taking up, but the supplier will not know definitively if this is the case," Telstra wrote in its submission.

The Communications Alliance proposed that a reference to the summary of offer be included in advertising of new telecommunications products.

"However, proposals to also include a reference to the Summary of Offer on bills do not appear appropriate: the revised Code already contains a number of additional inclusions on the bill, thereby further reducing space and ease of readability," it said.

Introduction of summaries came as one of several measures being presented by industry under increasing pressure from the ACMA, the telco ombudsman and the Federal Government to reform customer interactions and advertising practices.

Despite several submissions pointing to an ACCC undertaking with major telcos in 2009 over reforming advertising practices, the extent to which customers would go to read the fine print included in advertisements, on websites or in the proposed summaries had been dragged as arguments into several prominent Federal Court cases.