May 26, 2005, 10:06 AM — Two U.S.-based mobile industry groups are trying to rein in a Wild West market for cell-phone downloads, publishing a set of "best practices" for selling content such as ringtones, daily messages and screen backgrounds.
Some mobile phone users have lashed out against advertising and sales methods for mobile content sold via text messages, saying they ended up subscribed to ongoing services without knowing it. Earlier this year, a consumer who used VeriSign Inc.'s Jamster content download service sued the company for alleged fraud and false advertising.
On Tuesday, the Mobile Marketing Association (MMA) and Cellular Telecommunications and Internet Association (CTIA) laid down guidelines they said were written by a committee that represented the five biggest U.S. mobile operators as well as content providers and aggregators. The groups created the document so carriers would have a consistent set of rules for evaluating how potential partners do business, said Soren Schafft, vice president of products and operations at The Mobile Media Co. AS, a content aggregator in Oslo, Norway, who was on the committee.
"It says you're not allowed to provide services to people who don't want those services. And there's a set of methods for getting people to understand what the terms are and to agree to those terms," Schafft said.
The voluntary guidelines cover several topics, including the following:
- companies have to get subscribers' approval before sending them commercial text messages or other content
- ads and promotions have to clearly state all terms of the program, including pricing and whether it is a subscription service
- a service can't be called "free" if there are charges for "a reasonable level of participation"
- the service needs to have "opt-in" mechanisms that require the customer to do something such as send a specific text message
- users have to be told how to "opt out" when they sign up and later be able to find information on the "opt-out" procedure
The rules should make it easier for content providers to do business, according to Schafft. Up until now, each carrier has had its own guidelines for how content providers on its network should treat customers, he said.
"To be compliant with all the various standards was extremely difficult, and the standards were changing all the time, and it wasn't always clear what would be in compliance with one carrier or another," Schafft said.