Portugal’s National Communications Authority (Anacom) said it has recently received a significant number of complaints about a campaign by the operator Meo offering subscribers an additional 2 GB of mobile data at no cost, for use until 31 August. The regulator’s preliminary conclusion is that the campaign is harmful to subscribers’ interest and against the country’s Electronic Communication Law.

Under the terms of the offer, after the end of the promotional period, customers will automatically start paying for the extra traffic, at a cost of €3.98 (US $4.69). Those who do not wish to assume these additional costs starting on 1 September must contact Meo to request that the extra data be discontinued. Anacom said that Meo has been ordered to stop the campaign immediately but will make a final ruling on the matter after hearing from the operator.

Tarifica’s Take

Last week the Portuguese consumer association Deco filed a complaint with Anacom about Meo’s campaign, describing it as “illegal.” Deco’s Ana Sofia Ferreira told the Lusa news agency that the association has received dozens of complaints after Meo sent an SMS to customers saying it would provide them with an additional 2 GB of internet until 31 August, and that if the customer “prefers not to benefit from these advantages” he or she should call a toll-free number.

Deco stated that customers do not bear the responsibility for canceling an unsolicited service, that Portuguese law prohibits operators from charging for any unsolicited service, and that the absence of a consumer response does not count as consent.

While we are not experts in Portuguese law, we believe that however the matter is resolved, there is a universal lesson for operators here: Attempting to generate revenue by means of offers of this nature is not worth the revenue generated. The world of e-commerce is full of tricky or mildly deceptive offers of this nature, in which free or low-cost goods and services are available through a certain date, after which costs kick in and the onus for cancellation lies with the consumer. Counting on consumer forgetfulness as a revenue stream is, in our view, a misguided strategy. Whatever amount of revenue is created by this means—and we suspect that it will not be very great, in the final analysis—the potential for damage to the operator in terms of customer confidence and ultimately, loyalty can be expected to far outweigh it. Operators will do much better to be up-front with customers about expected costs and to offer promotions that make their customers want to actively purchase more services in the future.