Orange UK Issues Bill 500 Times More Than Normal; fights customer for payment

Alan and Carolyn Mazkouri run a small business. For 15 years they were loyal customers of Orange UK, who provided them with 10 phones. Their average bill was GBP300 (USD450) per month. So when they received a bill for GBP163,179 (USD247,559) they had no intention of paying. Who would? They are running a small electrical business, not a multinational conglomerate. However, Orange UK showed once again how too many telcos fail their customers and lack adequate controls relating to high usage, bill shock, and potentially fraudulent behaviour. And instead of learning their lesson and apologizing immediately, they pursued payment over a 9 month period, only backing down when the Mazkouri’s called both their lawyers and the BBC. Here is the story as presented on the BBC’s Watchdog consumer protection show:

There is also a short written version of the story at the BBC’s website here and the transcript of this video is available here.

So what was Orange’s final response? After being shamed by bad publicity, a company spokesperson finally proffered this meek apology:

We apologise to the Mazkouri’s for the inconvenience. We have fully refunded all charges from this exceptionally high bill and offered a further gesture of goodwill. We look forward to hearing from them.

The ‘gesture of goodwill’ was reportedly a GBP250 compensation payment. Not surprisingly, the Mazkouri’s are taking their business to another provider. My concern is that lessons are not being learned by disjointed and dysfunctional telcos, and this story raises so many questions that I must be brief when spelling them all out:

  • These people were customers for 15 years. Their average bill was 0.2% of the bill that prompts this story. The usage on one particular phone was sky high over a three week period. The usage on that phone was undoubtedly far higher than the usage on the other 9 phones covered by their contract. How much data does a telco need before its fraud monitoring spots something unusual? How long does it take to intervene proactively to contact a customer and, if necessary, cut off their phone?
  • When something is so obviously wrong, why does it take 9 months and negative TV publicity before the telco says sorry and tries to make redress? Why are the human beings that work for Orange not empowered to take more action to bring this kind of complaint to a swift resolution? Are Orange’s processes too rigid?
  • The victims ran a small business. These people rely on phones to stay in business and to service their customers. Like banks, telcos have a responsibility to the wider business community and the economy as a whole. With that in mind, why were Orange so slow to offer compensation, given that the inconvenience of a disconnected phone means this customer may have lost business?
  • There is probably a report somewhere in Orange that says they ‘lost’ £163,179. That report is incorrect. Orange never had a hope of getting that money, so they could never have lost it. Those numbers are the kind of rubbish that pump up leakage reports but are divorced from economic reality. What Orange has lost are loyal customers they were regularly earning a profit from. And Orange has also lost an immeasurable amount of business from other potential customers who watched this BBC show and decided to use another provider instead. What is the total loss? We cannot measure it with certainty, but it should be estimated and reported for what it really is. Unless a monetary value is applied when assessing damage to reputation, then reputation is always treated as worthless.
  • A newly-purchased smartphone was constantly downloading data. Either the problem was caused by a bug, or by malware. If it was a bug, has anyone followed up to determine how many buggy handsets are out there, and how many customers may be affected? Is the handset manufacturer at fault? If the fault was malware, where did it come from? Were there lax security protocols at the store which sold the handset? Or maybe with the manufacturer? Or did the customer download the malware himself, in which case Orange has been too meek in defending themselves, and they should have pointed out the dangers to other customers? In short, what does the telco do to protect themselves, and their customers, from network usage which the customer does not instigate and does not want?
  • Telcos are concerned about network capacity and how the rapid growth in data usage may overwhelm their infrastructure and constrained capital spending. They use this logic to justify bandwidth management, sometimes in ways that interfere with the customer’s experience. So what happened in this case? Should Orange be doing more to manage bandwidth in cases like this, or did they get lucky because the bill might have been even higher were it not for their existing approach to limiting bandwidth?
Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Chief Executive of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.

2 Comments on "Orange UK Issues Bill 500 Times More Than Normal; fights customer for payment"

  1. Avatar David Leshem | 24 Jun 2013 at 1:00 pm |
  2. “Why are the human beings that work for Orange not empowered to take more action to bring this kind of complaint to a swift resolution?”

    There are RA professional not empowered to install software on their own PC with the support from IT…. Telco’s unfortunately are not these tech savvy, innovative, pioneering companies – sad but true

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