TIO thinks it’s okay for telcos to sell consoles, but not help with repairs

A five-year independent review of the practices of the Australian Telecommunications Industry Ombudsman by Queen Margaret University Dr. Gavin McBurnie and Jane Williams have revealed some interesting findings regarding telecommunications carriers and video game hardware.

The TIO is, of course, the independent body set up to help the average Australian make more serious complaints when dealing with domestic telecom providers. If you believe your telephone company has treated you wrongly or unfairly, you can take the matter to the TIO and, if your issue is within their jurisdiction, ask them to fight the telephone company on your behalf.

The findings we will discuss are presented under Equipment, beginning on page 94. The third in a list of issues related to changes to the TIO mandate concernsthe dthe extent to which the TIO should be able to investigate complaints about equipment sold or supplied by telecommunications companies.“This is important because the way we interact with our telecommunications providers has changed significantly. Today, telcos don’t just sign people up for phone plans, they take care of all kinds of internet-enabled devices. Modems and routers, smartphones, tablets, TVs and streaming boxes, and, yes, even game consoles.

According to the report’s findings, the TIO’s recently revised terms of reference clarify the types of complaints that the TIO would consider assisting. According to the report, this should help you if you have “a problem with member-provided telecommunications equipment, or member infrastructure, that affects consumer access to a telecommunications service provided or offered. by a member”. This wording would suggest that the TIO is expanding the range of equipment under its jurisdiction under the revised terms of reference.

Consumer groups thought it was great, saying they felt “that it is the deputies who are make the decision to enter the retail market for such equipment and that Members should be responsible for the equipment they sell.” The members (aka telcos) disagreed, suggesting that the TIO was going well beyond its remit. In the opinion of the members, the TIO “should have limited skill on equipment,” and “suggested that the TIO was attempting a “land grab”, “being everything for everyone”.

The report sums up the impasse pretty well:

The question at the heart of this debate between MEPs and consumer groups is where if the boundary lies. That is, for which equipment sold or provided by Members whether the TIO is able to accept complaints. Members want the limit to be quite tight while consumer groups want the boundary to be quite loose.

Now here’s the part where it gets really interesting: it looks like the telcos got what they wanted. On page 97, the report shows exactly which devices TIO is ready to help you with. According to the report, “the equipment falls under the jurisdiction of the TIO if purchased from a ser telecomvice.” When they say “telecommunications service”, they mean “mobile phone plan” or “home internet plan” – any service that cannot be used without specialized equipment such as a smartphone or modem.

“If no associated telecommunications service has been purchased but the equipment was a handset, mobile phone, tablet, modem or router, then a claim will be reviewed by the TIO if the issue affects the consumer’s ability to access the telecommunications service,” the report continues. “Smart hCertain devices, smartwatches, drones, accessories such as earphones or headphones, game consoles and laptops are specifically listed as items of equipment that the TIO will not expect to consider.

This, of course, opens a kettle of worms because nowadays telecom operators in Australia are sell video game consoles on a contract that you could theoretically pair with an internet plan, if you wish.

For example, Telstra is Microsoft’s official partner in its Xbox All Access program. The idea is that you can get an Xbox Series X or Series S console on a contract, much like you would a cellphone handset. You pay a monthly fee ($33 for Series S, $44 for Series X) over 24 months, and you get an Xbox Game Pass Ultimate membership for the duration. The idea, or at least what the idea has been before the pandemic was badly marred by electronics manufacturing and supply chains, was that Xbox All Access users would either keep their console at the end of the 24-month contract, after paying for it, or upgrade to the latest version of hardware, which should have arrived by then (it doesn’t).

But what if that Xbox breaks down? Who is responsible for repairing or replacing it? According to the Xbox All Access FAQ, it’s on Xbox, not Telstra. Bad or defective Xboxes, even those under contract with a major telecommunications carrier, are still subject to the same limited Microsoft warranty as those purchased directly. “Please note,” reads the fine print, unnecessarily, “monthly payments will continue until the remaining balance on your Telstra account for Xbox All Access is paid in full, even if your Xbox console is not working.

Gif: NBCUniversal

So not only will neither Telstra nor the TIO help you if your Xbox is a lemon, Telstra is free to keep charging you while you wait for it to come back from the store – which could also be out of your own pocket if its the issues are not covered by Microsoft’s limited warranty. And the TIO agrees with that because telecom operators like Telstra pushed it to think that everything was fine, against the advice of consumer groups.

To sum up: We live in a bureaucratic hell.

I’m going to let McBurnie and Williams summarize:

The review team is concerned about the current position taken by the TIO regarding these prproducts. The limit of what does or does not come under its jurisdiction appears be determined by what the industry was prepared to accept. Given the importance the power imbalances that exist between Members and individual consumers is disappointing.

You can read the full report here.

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