Appendix: Joint Ofcom and ICSTIS response
Introduction
1. Ofcom and ICSTIS welcome the Culture, Media and
Sport Committee's ("the Committee") report and are pleased
to be able to respond to the Committee.
2. Recent reports of malpractice in the premium rate
service ("PRS") industry highlight the importance of
the Committee's report, the regulators current rules and regulations
and the recent consultations concerning new rules in this sector.
The revelations about the operation of PRS have seriously damaged
the trust between the broadcaster and the audience and raises
serious concerns about consumer protection. Both Ofcom and ICSTIS,
working together, wish to emphasise as strongly as possible that
effective regulation of Call TV Quiz Services is of paramount
importance and that much work has already and continues to be
done to ensure robust protection for the public.
3. In addition to investigating specific cases, Ofcom
has recently announced an Inquiry into the apparent systematic
failures of compliance in this area. In particular, Ofcom is concerned
about the way that the structure of relationships between broadcaster,
producer and service provider can best be aligned to ensure the
greatest level of consumer protection.
4. This question is directly concerned with the issue
of trust between broadcaster and audience. As the sectoral regulator
for broadcasting - as identified by the Committee - Ofcom agrees
with the Committee that it bears the leading role in this issue.
Ofcom is therefore responsible for ensuring that all regulatory
responses are properly co-ordinated, and that there is an appropriate
range of both organisations and rules to protect consumers.
ICSTIS is responsible for the day to day regulation of the promotion
and operation of premium rate services (e.g. whether callers are
overcharged or whether the pricing of the call is free), while
Ofcom itself regulates the editorial standards in such programming
(e.g. investigations into fake winners). Ofcom also requires
all broadcasters to ensure that any material they broadcast which
uses PRS is fully compliant with ICSTIS's code. As a result of
this interlocking set of relationships, we believe that the necessary
measures and expertise are in place or in hand to achieve the
report's objective of fair, open and trustworthy quiz services.
However, as noted above this sector remains under close regulatory
scrutiny and conclusions to consultations on tighter regulation
is imminent.
5. Having suitable rules and mechanisms for effective
investigation and enforcement is of course crucial; and, as the
Committee rightly observed, good co-ordination is vital too.
We address the subject of co-ordination in detail later in this
response but would make the point here that this joint response
is itself a strong expression of the two regulators working together
and understanding clearly their respective roles and the leadership
framework that has been established under Ofcom's supervision.
6. Our response addresses those of the Committee's
conclusions and recommendations that are relevant to Ofcom's and
ICSTIS's roles, separately or jointly, in the order set out in
the report.
Responses to conclusions and recommendations
(1) We understand that ICSTIS's conclusions [from
its review of the sector] are imminent, and we urge the Gambling
Commission to publish its own findings as soon as possible.
(Paragraph 25)
7. ICSTIS published the results of its recent monitoring
and research into Call TV quiz shows on 29 January 2007. In the
light of its review, ICSTIS also launched a public consultation
addressing many of the concerns raised in the Committee's report
and aimed at strengthening the rules across the sector. The consultation
closed on 12 March 2007 and ICSTIS is expecting to publish its
proposals for action next month.
8. A copy of ICSTIS's Analysis and Consultation Document
is attached as an annex to this document.
9. ICSTIS also met with broadcasters on 8 March 2007
to discuss ongoing concerns regarding the use of Premium Rate
Services in all participation programming, not just Call TV quiz
shows. Following this meeting ICSTIS set out a range of actions
aimed at restoring public trust and confidence in these services
and ensuring consumers are protected. This included:-
- Asking all broadcasters and
their partners to carry out a review of their current and forthcoming
participation TV programming to ensure there is no risk of consumer
harm. Responses are to be provided to ICSTIS by 26 March 2007.
- The introduction of systematic monitoring by
ICSTIS and inspections to ensure services are being run as they
should.
- An expectation that providers would publish complete,
accurate and easily understood rules for all competition services.
- The introduction of a licensing regime for all
premium rate service providers operating participation TV services
within three months. Such a licensing system will define where
responsibility for compliance with the ICSTIS Code of Practice
lies so that viewers can have absolute confidence in services.
As part of establishing a licensing regime, ICSTIS will explore
with the industry the benefit of introducing a trust mark or quality
standard to build long-term public confidence in services.
(7) We commend the operators who have voluntarily
introduced practices intended to help viewers who make repeated
premium rate calls appreciate how much they are spending. We recommend
that ICSTIS commission or carry out research into the effectiveness
of alerts and limits on the number of calls, particularly (in
co-operation with consumer bodies) among individuals who have
got into debt. ICSTIS should consider making it a requirement
for quiz show operators to take steps to ensure that callers are
aware of how much they are spending. (Paragraph 38)
10. The ICSTIS review, published on 29 January 2007,
included details of recent research and monitoring undertaken
into the operation of Call TV Quiz Services. As a result of this
review ICSTIS has consulted on proposals to impose a requirement
on operators to provide announcements to callers at each £10
step they spend to ensure that they are aware of their overall
spend.
(9) We welcome Ofcom's finding, in response to
a complaint, that ITV had conducted a competition unfairly and
had been in breach of Rule 2.11 of the Broadcasting Code.
(Paragraph 43)
11. Ofcom investigates all complaints that raise
issues under the Broadcasting Code where there are specific rules
and guidance to ensure fairness in broadcast competitions. Ofcom
believes that publicly highlighting cases of inappropriate question-setting
or other irregular practice in the arrangement of competitions
plays a significant role in letting audiences and broadcasters
know what is and is not acceptable. The publicity that is generated
for the broadcaster acts as a further, powerful deterrent.
12. Ofcom also has the power to impose statutory
sanctions (including fines and revocation of licences) against
broadcasters for repeated and serious breaches of its codes.
ICSTIS can also fine telephone operators of PRS up to £250,000.
Both regulators stress that they are quite prepared to use the
full range of sanctions should it be warranted.
(10) Some methodologies used for puzzles on Call
TV quiz shows are not obvious. We believe that this is tolerable
as long as viewers are made aware there is a cryptic element:
but this is currently not made clear. Guidance from Ofcom on the
issue is sound but does not go far enough. We recommend that Ofcom
should require broadcasters to inform viewers that puzzle solutions
may not be as simple as they seem. We believe that checks by an
independent third party on proposals for new puzzle types and
on each puzzle for conformity with agreed rules are valuable in
building confidence in the propriety of the games. They are also
in the industry's own interests. If there is continued evidence
of abuse and significant numbers of complaints about games methodologies,
Ofcom should consider making it obligatory for all broadcasters
of Call TV quiz shows to verify games with a third party and lodge
solutions with them to prevent underhand changes being made while
the show is on air. We recommend that Ofcom should consider carefully
whether operators should be required to broadcast not just the
solutions but also a brief explanation as to how they are arrived
at. (Paragraph 48)
13. Ofcom currently requires broadcasters not to
mislead viewers about the difficulty or cryptic nature of a competition.
That seems to us to be the right approach. In practice, the
description and layout of a game will generally alert the audience
to what sort of puzzle to expect - word searches, 'word tower'
games, number puzzles and so on - and only where programming actively
misdirects viewers about the ease or method of solution can we
reasonably bring rules to bear. Considerations of fairness will
apply here too: if a game is wrongly conducted for any reason,
including misrepresentation of complexity, Ofcom's rules and guidance
on fairness operate. Importantly, therefore, by operating a general
rule on fairness Ofcom is able to intervene where a game might
entail an absurdly contrived or perverse solution, for example,
whether or not some indication is given about its being cryptic
or irregular.
14. Ofcom requires broadcasters to reveal on air
the answer to all quizzes. It does not require that the actual
methodology behind an answer is revealed, since it may be commercially
sensitive and ultimately make such games impossible to run. However,
when Ofcom receives a complaint concerning this issue, it insists
that the broadcaster provide it with the methodology, so it can,
as an independent regulator, verify the answer and validation
process.
15. Ofcom currently requires that broadcasters are
able to demonstrate to it that an answer has not been changed
in the course of a competition. Lodging answers with a third
party is one obvious means of doing so, as the guidance indicates.
But it is a licensee's responsibility to comply with the requirement;
the burden of proof lies with the broadcaster. However a broadcaster
goes about it, Ofcom expects unambiguous evidence of compliance.
It is satisfied that at present the application of this guidance
offers a suitable degree of regulation while allowing flexibility
for broadcasters in fulfilling it. Nevertheless, if Ofcom became
aware of systematic problems in this area, it would not hesitate
to create rules that effectively protect the viewer.
16. More generally, Ofcom's view is that detailed
prescriptive rules are generally not well suited to matters of
content regulation. In applying the general standards set out
in the Communications Act 2003, Ofcom's focus is primarily on
outcomes - what is broadcast - rather than the process of achieving
that outcome. Rules based on process may not be applicable in
all cases: compliance with a set of rules, no matter how detailed,
may still not achieve the desired outcome. The burden of compliance,
including the editorial processes involved, should rest unambiguously
with the broadcaster.
17. Even so, Ofcom agrees with the Committee that
if systematic abuse becomes apparent it should consider tightening
this area, including exploring whether some closely defined process
requirements should be established.
(11) We are surprised that there have been so
few complaints in Ofcom's Broadcast Bulletins about games methodology
or about the obscurity of answers. On balance, unless there is
a significant drop in confidence in the integrity of Call TV quiz
programmes, we accept that Ofcom's role in ensuring fairness should
continue to be primarily one of responding to complaints rather
than taking a proactive stance. We recommend, however, that Ofcom
should publish periodic reports on the findings of its exercises
in monitoring Call TV quiz programmes. Ofcom should in particular
watch for any sign that top prizes are consistently going unclaimed
because they are associated with puzzles which are so obscure
that no viewers solve them. (Paragraph 50)
18. Ofcom agrees with the Committee that at present
responding to complaints is the appropriate stance for Ofcom to
take. Ofcom would like to re-emphasise that the process of investigating
complaints does lead to many hours of programming being examined
and in effect monitored.
19. It is important to bear in mind that in the area
of Call TV Quiz Services, as in all of Ofcom's content work, it
is the viewing audience that provides the biggest and most effective
monitoring operation.
20. Problems with the operation of behind-the-scenes
PRS systems and studio procedures, however, are not easily detected
or exposed by viewers; monitoring in that respect would be valuable.
ICSTIS is therefore pleased to able to confirm that as part of
its recent research it undertook extensive monitoring of the way
Call TV Quiz shows operate. ICSTIS also undertakes monitoring
as part of the general regulatory process and will be conducting
systematic inspections of operating premises to ensure compliance.
21. Ofcom is not aware of any evidence that top prizes
are regularly going unclaimed. However, Ofcom's Inquiry will
examine this matter carefully.
(12) We signal our strong view that any practice
of misleading viewers about call volumes or of blocking calls
would be more than unfair: it would be fraudulent and should be
punished under criminal law. It would also be a disgrace to the
Call TV quiz industry. (Paragraph 52)
22. ICSTIS has made clear, publicly, that where evidence
of fraud or other criminal practice comes to light, it will not
hesitate to pass on that information to the police. ICSTIS has
an excellent relationship with the City of London Police, who
have already investigated one case of alleged fraud by a call
TV Quiz Service. As a result of that Police investigation it was
decided by the CPS that there were insufficient grounds on which
to bring charges.
23. Since the publication of the Committee's report,
other issues have come to light which suggest that audiences may
have been misled in other ways - for instance, about the existence
of winners. Ofcom is investigating a number of such cases, and
will publish its findings in due course.
(13) We accept the statement by ITV that the number
of callers being charged for calls made after they have exceeded
call limits set by broadcasters and who therefore cannot participate
is very small. Nonetheless, it is unacceptable in principle that
such callers should continue to be charged, particularly when
they do not understand the futility of such calls. We welcome
the undertaking by ICSTIS that it will investigate the practice
of continuing to charge. We find it difficult to believe that
there is no suitable way of preventing such calls from being charged,
and we urge BT to assist in finding a solution. In the meantime,
customers should be refunded the cost of any calls made which
have been blocked from entering the competition. (Paragraph
56)
24. ICSTIS' consultation on Call TV Quiz Services
identifies the technological problems that are associated with
resolving this issue. ICSTIS have sought more information about
the actual nature and size of this problem overall as well information
about how this problem could be resolved. ICSTIS is committed
to keeping this issue under review, recognising that technical
solutions may not be straightforward. However, both Ofcom and
ICSTIS agree with the Committee that it is unacceptable for callers
who have been barred entering a competition, because they have
spent too much money, to be charged.
(14) We believe that there is scope for raising
the standards which broadcasters should meet in presenting information
on the cost of participation on-screen, possibly by prescribing
the balance to be maintained between that information and the
premium rate number. (Paragraph 62)
25. The current ICSTIS Statement of Expectations
sets out rules requiring operators to provide spoken and on-screen
information about the cost of participation. However, the ICSTIS
consultation proposed to strengthen these rules by mandating operators
to provide cost information, verbally, at intervals of no more
than 10 minutes to ensure viewers fully understand the cost of
participating in a Call TV quiz show. This is in addition to
the current requirement to display the cost of a call every minute.
Given the broad support for this proposal from consultation, ICSTIS
expects to bring forward, as a matter of priority, strengthened
rules for pricing information to be provided verbally
(15) We accept that there may be practical difficulties
for operators in displaying a figure purporting to show the odds
of any viewer getting through to the studio by making a call at
that particular moment, but we believe that they are not insurmountable.
We are firmly of the view that there should be more transparency
about the factual information on which a calculation of the odds
would be based. (Paragraph 65)
26. ICSTIS, with Ofcom's support, acknowledges that
improved transparency to consumers about the chances involved
in participating in Call TV Quiz Services is critical and essential
to consumer trust, understanding and confidence in these services.
The recent ICSTIS consultation therefore sought views on practical
ways in which this might be achieved. The result of this consultation
and any new rules is expected to be published next month. The
consultation demonstrated broad support for the need for improved
transparency in this area and ICSTIS expects to bring forward,
as a matter of priority, strengthened rules in this area.
(16) We recommend that broadcasters should be
required to display some recent historical information about volume
of incoming calls, with an indication of the odds of being connected
to the studio. The operators and regulators should together devise
a model for prescribing what information should be provided and
how often. We acknowledge that considerable care will need to
be taken to ensure that the information given to viewers will
indeed increase transparency. (Paragraph 68)
27. As noted above, ICSTIS is considering the responses
to its recent consultation on practical ways to increase transparency
to consumers about the chances of getting through to the studio.
(17) While it is right and proper that operators
should be able to ban participants caught cheating from further
participation, we believe that any participant who has been banned
should be given full information on the reasons why the ban has
been imposed. (Paragraph 69)
28. Ofcom requires that licensees make clear to viewers
if exclusions apply to entry - age requirements for example.
The problem in the case presented to the Committee showed the
need for participants to be clear about the Terms and Conditions
which apply, and specifically whether a large win would lead to
a ban on participation. Ofcom agrees that the Broadcasting Code's
guidance note, which covers TV competitions, might be strengthened
to require that any participant barred from entry be given full
reasons by the licensee. ICSTIS has also made clear that all
providers will review their Terms and Conditions to ensure they
are complete, accurate and easily understood.
(18) We welcome the recognition by regulators
that close co-operation is needed in the Call TV quiz sector.
Given the distinct areas of expertise of each of the regulators,
we believe there should continue to be a regulatory role for each.
However, we recommend that there should be one regulator, in our
view Ofcom, taking the lead and orchestrating oversight. We believe
that members of the public have no clear idea which body they
should complain to if they have concerns, and we recommend that
a single body should take responsibility for registering all complaints
and forwarding them, as necessary, to the appropriate body. This
would allow regulators and broadcasters alike to gain a clearer
picture of where concerns lie. (Paragraph 76)
29. Ofcom and ICSTIS are pleased that the report
acknowledges the regulators' recognition of the need for close
co-operation. And we readily agree with the Committee's view
that one regulator - Ofcom - should take the lead and orchestrate
oversight.
30. It is important to stress that Ofcom already
has general oversight of ICSTIS's activities. ICSTIS regulates
premium rate services (PRS) under a Memorandum of Understanding
with Ofcom, which approves its Code of Practice, budget and annual
activity plan, including an assessment of its performance and
the prioritisation of its strategic direction. On a day to day
basis, therefore, there are well established arrangements between
the two regulators that cover such matters as broadcasting, telecoms
investigations and general strategy.
31. In the light of its overall responsibility for
the broadcasting sector, Ofcom is separately starting an inquiry
into the apparent systematic failures of compliance in this area.
In particular it will examine the structure of relationships between
broadcaster, producer and service provider, examining how they
can best be aligned to ensure the greatest level of consumer protection.
32. Separately, Ofcom is currently undertaking a
broad review of the scope of regulation of premium rate services.
The aim of the review is to consider whether current PRS regulation
meets the needs of consumers while supporting an innovative and
growing PRS industry. Both regulators are keen to ensure the most
effective regulation of PRS in the converging media landscape.
33. Ofcom and ICSTIS recognise the need, clearly
articulated in the Committee's report, to ensure that the public
are clear about their respective roles in the regulation of quiz
TV and to ensure the most effective regime exists for detecting
and acting against abuses.
34. However, we do not share the Committee's view
that a single point of complaint would be in the best interest
of consumers. We believe that all complaints should be accepted
irrespective of where they are lodged, and redirected by the regulators
themselves to the most appropriate respondent. Ofcom and ICSTIS
have well-organised and easily accessed procedures for the registration
of complaints. Complainants to either body may write, call, email
or use web-based facilities. Both bodies' identities and contact
details are widely publicised including in ICSTIS's case on the
back of telephone bills and in many phone directories. And of
course both bodies' complaint handling machinery is well-tested
and efficient.
35. Ensuring that any transfer of complaints (or
aspects of complaints) is done by the regulators themselves is
consistent with the way in which both regulators have processed
all other broadcasting complaints that involve PRS, high profile
examples of which have included public concern about the recent
Five Brainteaser programme (where it is alleged that the names
of winners were fabricated) and the current "You Say, We
Pay" competition on Channel 4's Richard and Judy. Of course,
both regulators will continue to explain fully to complainants
who is considering their complaint and why.
36. Ofcom is leading in the co-ordination of work
on investigations, sanctions and general policy in this area.
Ofcom is currently acting as the hub for Call TV Quiz Services
regulation, ensuring, among other things, that decisions about
ICSTIS and Ofcom rules - including reviews of them - and their
application complement each other and maximise consumer protection.
Similarly, Ofcom is active in gathering to the centre any information
about Call TV Quiz Services that might influence the regulatory
position, including close contact with the Gambling Commission.
Distributing that information and co-ordinating responses to
it is of course another part of the leadership role.
37. A further, important illustration of Ofcom's
leadership in this area is its Participation TV project. That
project has already issued a discussion paper and, underpinned
with powers of compulsion, sought very detailed information from
licensees. Since Call TV Quiz Services is the largest and much
the highest profile type of Participation TV, a substantial part
of the forthcoming consultation will be given over to it. Consumer
protection concerns figure prominently in the work. In considering
the most appropriate way to regulate this sector, Ofcom will look
at a number of options, including the introduction of new rules.
ANNEX
ICSTIS Call TV Quiz Services Review: Analysis and
Consultation Document
(Not printed here)
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