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TalkTalk and Tiscali UK refund customers
Thursday 3rd March 2011, by Daniel King
Problems with TalkTalk and Tiscali UK's billing systems could provide broadband customers with an incentive to switch.
An Ofcom investigation followed more than 1,000 complaints from customers who were billed for services they had cancelled.
Last July's investigation has resulted in the two broadband providers paying out almost £2.5 million in refunds and goodwill payments, the communications watchdog has revealed.
The companies were given a deadline of December 2nd to comply with telecommunications rules that prohibit companies to bill customers for services that have not been provided.
In addition, Ofcom ordered the providers to remedy the breach of telecoms regulations by paying refunds to customers affected by the billing error.
A total of 62,000 customers were compensated, and Ofcom are satisified that both TalkTalk and Tiscali have taken action to comply with regulations.
Ofcom cannot impose fines on companies that take action to rectify breaches under its current legal powers.
However, the law may be changed to give the watchdog more authority, allowing fines to be issued to companies in breach of regulations, regardless of subsequent action to address the error.
If approved by government, Ofcom's powers would be extended from May 25th.
Despite TalkTalk and Tiscali's actions to rectify the billing issue, Ofcom have reported that complaints are still being made.
The investigation into the two providers will continue, with the potential for further regulation enforcement, including a financial penalty.
A recent Ofcom report could change the way that broadband providers are allowed to advertise connection speeds to customers.
Research has revealed that broadband customers in the UK receive on average only half of the advertised speed.
To prevent consumers being misled, the watchdog recommends speeds used in marketing to be based on a Typical Speed Range (TSR) to give customers a clearer idea of what speeds they can achieve.
In addition, maximum speeds should only be used in advertisements if they are achievable by a substantial number of users.
