Case president backs customers' complaints about StarHub's billing changes

CONSUMER advocate Lim Biow Chuan is backing StarHub customers who have complained about the company's move to change the way it charges for mobile talk time.

Previously, its charges were on a per-second basis, at a rate of 0.2675 cent per second.

But from this month, the telco is charging 16.05 cents for the first minute, followed by the 0.2675 cent per second rate.

The new pricing structure for voice and video calls applies to its 1.1 million subscribers who pay their bills monthly.

Customers complained that it will affect those who bought bundled talk time in blocks of minutes, because even a 25-second chat will be counted as one whole minute.

Mr Lim, president of the Consumers Association of Singapore, said: "It is not a significant increase, but it is a matter of principle."

He admitted that telcos have the right to change terms as these rights have been worked into contracts, but said that "as a matter of good business practice, they should apply the new conditions to consumers only at the point of contract renewal".

StarHub has charged on a per-second basis for 13 years and its move has sparked complaints to The Straits Times Forum Page. One reader wrote: "Shouldn't the new way of billing apply only to customers who renew their contracts, so they have the option of switching to another service provider if they are unhappy with the new terms?"

Nomura Securities managing director Sachin Gupta said companies regularly review pricing policies because customer behaviour and business needs evolve constantly. "Businesses have to watch their bottom lines too, so pricing policy changes are inevitable," he said.

But senior analyst Clement Teo from research firm Forrester said surprising customers with changes mid-contract may detract from any goodwill created.

"Customers need time to understand the implications of major contractual revisions, and forewarning them, for example, at least three months prior to the changes kicking in, could be one approach," he said.

Ms Cassie Fong, senior manager of corporate communications at StarHub, said the billing policy change will help the telco manage rising business costs, but she would not provide details of cost savings.

"The majority of our customers do not exceed their bundled minutes so most of them will not see a significant change in their call charges," she added.

SingTel has a similar billing structure but after the first minute - which costs 16.05 cents - customers are charged in blocks of six seconds.

M1 is the only telco that still charges on a per-second basis of 0.2675 cent per second.

itham@sph.com.sg