Telco customers face 'information overload'

  • Consumers looking for broadband are overwhelmed by information
  • Staying put with current ISP seen as easiest option
  • Better information needed to help consumers choose an ISP

Customers looking for telecommunications services are suffering from "information overload" according to a study.

The report, funded by Deakin University and Australian Communications Consumer Action Network (ACCAN), found some consumers were so overwhelmed with decisions, they were relying solely on the recommendation of the salesperson or friends to avoid having to compare plans.

In some cases, consumers reported there was so much information from telcos it was just easier to stay with their current provider than switch.

Deakin University’s consumer behaviour expert, Dr Paul Harrison, carried out the study. Too much information will not increase understanding, Dr Harrison found, and can increase confusion instead. Unit pricing - breaking down the cost of a plan into units for easier comparison - was not found to be very successful in helping consumers decide between providers.

"Better – not more – information for customers is needed," Dr Harrison said as he presented the report at the ACCAN National Conference.

The report recommended less jargon, encouraging the use of comparison websites and further education for consumers on how to compare plans.

Scott Kennedy, General Manager of broadband comparison site Compare Broadband, said: "We provide the exact service Paul Harrison refers to and it is free. Even without 'unit pricing' we can guide the consumer to the right plan for their needs."

Comparison sites can offer independent, straightforward advice and enable consumers to compare plans for themselves. Customers with questions can call up and have the jargon explained by someone who is not trying to 'hard sell' a product at the same time.

The report also calls for an acknowledgement from policymakers that telecommunications are an essential utility, playing a central role in people’s lives and involving a significant financial commitment and stronger consumer protections.

The important information needed by consumers includes network coverage, contract termination fees and cooling off periods, the report advised.