Tuesday, 28 September 2021 13:04

TIO Annual Report problems persist for small businesses Featured

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Complaints about phone and internet services decreased 6.1% in the last financial year ending 30 June 2021. During this period, residential consumers and small businesses made 119,400 complaints to the Telecommunications Industry Ombudsman (TIO), highlighted in the Annual Report 2020-21 published today.

The TIO says that while overall complaint volumes continued to decline for the third year running, escalated complaints remained high. Complaints from small businesses reached a three-year high and financial loss continued to be a problem for small businesses.

For all service types and consumers, poor customer service and problems with a bill were the most common complaints. Telcos being uncontactable remained a problem, particularly for small businesses. While this was primarily driven by COVID-19 impacts, consumers also complained about their struggle to navigate new or changed ways of contacting their telco, the TIO said.

The report showed that complaints from small businesses increased 6.6% to 19,689. This is the highest number of complaints from small businesses in the last three years, the TIO said. Complaints about financial loss resulting from phone and internet problems grew by 13.3%. Other increases were seen in complaints about failure to cancel a service and telcos being uncontactable. Complaints about a small business not having a working phone or internet service increased by 6.5%. In a positive development for small businesses, fewer complaints were made about problems with phone number loss, intermittent service, and telcos not delivering on agreements.

Internet continued to be the most complained about service type, accounting for 33.4% of complaints from residential consumers and small businesses. Internet complaints declined 7.1% against the previous financial year. Notable challenges faced by consumers during this period included problems contacting telcos, and telco’s failure to cancel a service. There were fewer complaints about telcos not agreeing to and following through with resolutions, and slow data speed.

The report showed that mobile phone services were the next most complained about service type at almost 33% of complaints. Mobile complaints declined 1.5% against the previous financial year. Complaints increased about problems contacting telcos, variations to contracts or plans, and failure to cancel a service. Complaints declined about misleading conduct when making a contract and delays establishing a service.

The proportion and volume of complaints about landline services reduced this year. Landline complaints decreased 18.3% and accounted for almost 11% of all complaints. Phone number problems due to connection, disconnection or transfer of a landline service dropped 26%, while complaints about being unable to contact a telco and failure to cancel a service increased, the annual report highlighted.

Fault and connection problems continue to make up a significant proportion of complaints, at 47.1%. Fault and connection complaints declined for internet and landline services, however problems for mobile services increased by 8%. The main driver of this increase was complaints about poor mobile coverage, the report showed.

Complaints about Telstra increased by 11.3%, accounting for 62.1% of all complaints, an increase of 7,523 complaints compared to the last year. Telstra recorded increases in complaints about internet, mobile and multiple phone services. Complaints also increased for Southern Phone Company (20.1%), Aussie Broadband (37.2%), Boost Tel (28.4%) and Foxtel (32.3%), all of these from relatively low bases and all but one representing less than 1% of total complaints. Significant declines were recorded for iiNet (-48.8%), TPG (-39.5%), Dodo (-32.5%), and Optus (-27.9%), the report showed.

Despite the drop in overall complaints, the number of complaints coming back unresolved and needing further work remained high at 16,607. This is likely to be due to the reliance on telecommunications services during the pandemic, and challenges faced by telcos in responding to consumers’ problems, the TIO concluded.

Commenting on the release of the Annual Report, Ombudsman Judi Jones said, “The complaints picture for this year is mixed. Overall complaint volumes are down 6% on last year and we have seen significant reductions in some of the problems faced by consumers. It’s been a challenging year for telcos and consumers, and we acknowledge industry efforts to reduce complaints.

“However, we saw an increase in the proportion of complaints returning to us as unresolved, which challenged our response times. This resulted in frustration for consumers wanting to have their phone or internet problems addressed quickly.

“The trend in small business complaints is concerning. Small businesses need reliable phone and internet services, and useful support when those services aren’t working as they should.

“Telcos need to continue focusing on giving great customer service. This includes making it easy for customers to complain when there’s a problem and providing an effective complaints process to fix that problem.

“We will continue reporting on these complaint trends and working with the telcos to reduce these complaints and improve practices.”

FY2020-21 complaints summary follows:

Overall

  • 119,400 complaints were received in the last financial year, a decrease of 6.1%.

Residential consumers

  • 99,711 complaints (83.5%) were from residential consumers, a volume decrease of 8.2% against the previous year.
  • Most complaints received from residential consumers had to do with their internet and mobile phone services.
  • Problems with a bill and poor customer service recorded the largest volume of complaints.

Small businesses

  • 19,689 complaints (16.5%) were from small businesses, a 6.6% increase on the previous year and the highest volume of small business complaints in the last three years.
  • Complaints about multiple services accounted for 34.1% of complaints, an increase from 30.6% last year, with multiple services remaining the dominant service type for small business complaints.
  • Small businesses made 3,946 complaints about internet services, which made up 20% of small business complaints. the highest proportion and volume of internet complaints for small business in the last three years.
  • Complaints about business loss continue to be an issue for small businesses, growing by 13.3%.

Complaints about internet, mobile, multiple and landline services

  • Complaints about no or delayed action by provider increased most for mobile services (22.8%), but also increased for multiple (11.1%) and internet (7.2%) services. These complaints were mainly driven by consumers complaining about general delays in providers responding to COVID-19 related issues, delays in transferring their services to another provider, missed appointments, and delays in fixing billing issues.
  • Complaints about providers being uncontactable and failure to cancel a service increased across internet, mobile, multiple, and landline services. These two complaints were often related, with consumers complaining about providers not cancelling a service because they were not contactable. Complaints about providers being uncontactable reduced substantially by the fourth quarter, which is a positive development for consumers.
  • Complaints about missed appointments remained in the top 10 issues for internet services, increasing by 7% when compared to 2019-20. They were more of an issue in the later part of the year due to issues with the scheduling of NBN technician appointments.
  • Complaints about poor mobile coverage and equipment faults for mobile services increased by 9.3% and 7.3% respectively.

Complaint issues in phone and internet services

  • Poor customer service and problems with a bill were the most common problems reported by consumers. While these issues are frequently part of a complaint driven by other issues, complaints involving no or delayed action increased by 11.7% as consumers expressed frustration with their provider's failure to resolve their issues.
  • Complaints about providers being uncontactable increased by 88.4%. This issue was primarily driven by COVID-19 impacts, although changes by several providers to their consumer contact channels also impacted this issue, as some consumers struggled to navigate these.
  • Complaints about failure to cancel a service continued to increase in 2020-21 as a result of both COVID-19 processing delays and problems with porting. Complaints about enhanced or add-on features to a service increased by over 100% and were driven by a known problem with a single provider in the first half of the year.

Fault and connection complaints about services delivered over the NBN and other networks

  • Complaints involving fault and connection issues continue to be a significant proportion of our complaints at 47.1%. This was slightly lower compared to last year’s 49.2%.
  • Fault and connection complaints reduced by 10.1% across all service types, with noticeable volume reductions for internet services (9.1%), multiple services (13.8%), and landline services (22.3%) when compared to the previous year. Complaints about faults and connection problems for mobile services increased by 8%. Complaints about internet services delivered over the NBN also increased by 4.9%.
  • The main driver of the increase in faults and connection complaints about mobile services was an increase in complaints about poor mobile coverage. We also saw large increases in complaints about many other faults and connections keywords. However these did not reach the top 10 issues for mobile services.
  • There was an increase in the proportion of fault and connection complaints about internet, landline, and multiple services delivered over the NBN, but this is to be expected with most services moving to the NBN.

Complaints about service providers

  • Complaints about Telstra accounted for 62.1% of all complaints, increasing from 52.4% in the previous year. Telstra’s complaint volumes increased by 11.3% in the year.
  • Complaints also increased for Southern Phone Company Ltd, and new top 10 entrants Aussie Broadband Limited, Boost Tel Ptd Ltd, and Foxtel Management Pty Ltd replacing M2 Commander, Exetel and MyRepublic.
  • Optus accounted for 15.8% of complaints, with Optus complaint numbers falling by 27.9% in 2020-21. Declines were also recorded against TPG (down 39.5%), iiNet (down 48.8%), and Dodo (down 32.5%).

Complaints by State

  • The Northern Territory and Tasmania were the only two states or territories to record increases in the reporting period. NT consumers made 707 complaints, a year-on-year increase of 5.4%, and in TAS consumers made 1905 complaints, an increase of 4.7%.
  • Complaint decreases were recorded in ACT (down 8.3%), NSW (down 6.1%), QLD (down 4.3%), SA (down 7.2%), Vic (down 4.9%), and WA (down 14.9%).

What the industry had to say about the TIO Annual Report

The industry has responded to the TIO Annual Report release. Optus is very happy with their performance to reduce complaints by 27.9%. Macquarie Telecom disappointed with the industry's performance with respect to small business blaming too much off-shoring by major Telcos. Aussie Broadband, who's complaint performance worsened, said the reasons were due to the NBN HFC stop-sell and NBN connect and assure issues.

ACCAN pointed out that there was a 115% increase in complaints about the service providers being uncontactable. Something that shouldn't happen today particularly with everyone so reliant on telecommunications during the pandemic.

Telstra had a total of 74,135 complaints up 11.3% on the 66,612 complaints last year representing 62.1% of all complaints to the TIO. Telstra said that their performance for the first half had been disappointing, mainly due to COVID, but they had improved so much so that the last quarter was their best since 2015.

Optus customer success MD Maurice McCarthy said, "Optus is raising the bar on service with first-class customer experience our priority.

"Whilst no complaint is satisfactory, we are pleased with the results in the TIO’s annual report for FY 20-21, as they continue to build our momentum of reducing complaint volumes and in this instance, we have done so with a 27.9% reduction compared to last year.

"Across Optus, we are focused on building lasting customer relationships and a most loved everyday brand. Optus has implemented key initiatives which address customer complaints and improve our customers’ experience, such as our new contact centre operating model the Community of Experts . It’s the single largest transformation our customer care teams have experienced, which involved reinventing our contact centres end-to-end, from the technology we use, to the way we reward our people, to the way we bring digital to life in every interaction. This is unique to Optus and is core to us creating lasting customer relationships.

"It really is the future of building lasting and trusted customer relationships. Optus has remained committed to keeping customers connected and supported as they continue to face challenging circumstances.

"We continue to focus on building amazing digital experiences with our highly rated My Optus App at the core of everything we do including access to our messaging experts 24/7 and so much more.

"We remain committed to providing positive experiences to all our customers. What is important, is that we continue to listen to our customers and resolve their queries, simply & efficiently.

"We will continue to produce better outcomes and more timely resolutions to customer requests. We will continually challenge ourselves to continue this level of improvement to achieve our vision of being a truly loved everyday brand that creates lasting customer relationships," McCarthy concluded.

Macquarie Telecom group executive Luke Clifton said, “The combination of the Telecommunications Industry Ombudsman Annual Report and Consumer Policy Research Centre Sector Scorecard paints a worrying picture for customer service failure in Australia’s telecoms sector. It couldn’t come at a worse time, when we’ve never depended more on telco services to live, work, study, and help children keep up with school.

“The CPRC ranks telcos below mortgage providers and insurance providers, with extremely poor user experience, accessibility, payment support, and overall customer experience major pain points for consumers. The TIO shows complaints by small businesses – more reliant on telco services to operate during lockdowns – have reached a three-year high, while systemic issues such as poor service, billing issues, and the baffling inability to even contact telcos continue to go unfixed.

“What kind of wake-up call does the sector need to meet even the most basic levels of service Australians are calling for? Major telcos like Telstra should be leading the charge for better service, not be culpable for an 11.3 per cent rise in their own staggering level of complaints.

“I have been vocal for many years of the short-sighted but long-term negative impact of outsourcing and offshoring Australian technical skills abroad. This appalling lack of leadership shows that Australia is being left behind with quite simply a lack of skilled Australians available to connect technology to the needs of customers. These results prove it,” Clifton concluded.

ACCAN deputy CEO Andrew Williams said, “Phone and internet services have never been more essential for people in Australia, with much of the country working and learning from home during rolling lockdowns throughout the last financial year.

“While it’s positive to see that the overall level of complaints has fallen, we can’t lose sight of the fact that over 100,000 people have had to escalate a phone or internet problem to the TIO because they weren’t able to have their problem resolved by their telco."

Commenting on the fact that a provider being uncontactable increased a substantial 115.0% from the previous year, Williams said, "When you have an issue with your phone or internet connection, it is up to your provider to fix the problem. It’s very frustrating to hear that people are being left without a working connection while they hear little to nothing from their provider about what will be done to solve the issue.”

Williams said the growing number of complaints from the small business community likely reflected the pivot to ecommerce that many businesses have adopted over the past year, and the respective increasing importance of connectivity.

“Whether you’re a fitness instructor who has shifted to delivering classes over Zoom or a florist who takes orders over the phone or online, having access to reliable phone and internet services is vital to keep your business up and running in today’s age,” Williams said.

“We thank the TIO for their ongoing efforts to provide fair, independent, and accessible dispute resolution services. We look forward to continuing to work with the TIO and the telcos to advocate for communications services that are trusted, inclusive, and available for all,” Williams concluded.

Aussie Broadband managing director Phillip Britt said, "Unfortunately, we’ve seen an increase in the number of TIO complaints per 10,000 services in operation for the period April-June 2021 from 6.3 to 6.9 (9.5%). The reason for the majority of these issues relate to NBN’s HFC Stop Sell, NBN appointment issues and the impact of severe weather events.

"We take every customer complaint seriously, whether the responsibility lies with us or not. During this time, we worked with NBN on a daily basis to help resolve the situation and achieve the best outcome for our customers.

"We’re the fastest growing telco in Australia, therefore unlike other telcos, we’ve been severely impacted by the NBN connect and assurance issues. However, we’ve already seen a significant decrease in the number of complaints for July and August so far, and we anticipate things to return to normal levels in the next quarter.

"It is worth noting that our customer satisfaction at 8 weeks after connection is currently sitting at 8/10, despite ongoing challenges such as NBN HFC stop-sell and NBN appointment issues. We also consistently receive high scores from independent ratings systems like Roy Morgan, Choice Magazine and Mozo," Britt concluded.

A Telstra spokesperson said, "We know our customer service through the first half of the financial year was not where it needed to be, mainly due to the impact of COVID lockdowns in Australia and overseas. Pleasingly we have seen TIO complaints drop by more than a third from the first quarter to the last quarter of the year and they are now at their lowest point since 2015.

"We continue to move customers onto our new simpler plans and service system which is improving the customer experience and in turn reducing complaint volumes. We're also bringing our call centres back to Australia and our retail stores back in house.

"We remain focused on continuing to improve for our customers and as part of our new T25 strategy have pledged to further reduce complaints by a third in the next two years and by half in the next four," the Telstra spokesperson concluded.

This first appeared in the subscription newsletter CommsWire on 22 September 2021.


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Chris Coughlan

A versatile technology executive with extensive experience in most disciplines and technologies in the Information and Communications Technologies sector. Roles have encompassed general management, product management, business development, sales management, industry marketing, operations management, research and development, business case development, market research and forecasting, regulatory, strategy management, solution development, major project construction, process design and management, technology and management consulting, and engineering.

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