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    Mar 17, 2016

    MDA revamp of pay-TV contracts: No exit penalty if fees are raised by provider

    PAY-TV consumers will soon be given the choice of shorter, 12-month contracts for packages or bundles.

    They will also be able to cancel their contracts early without paying a penalty if the service provider increases subscription fees or removes important content.

    These are some of the changes recommended to the Media Market Conduct Code that the Media Development Authority announced yesterday to guard against unfair pay-TV practices.

    The changes, which are expected to take effect next month, address three areas of consumer concerns: unilateral contract changes, forced upgrades of non pay-TV services and lack of awareness of the contracts' terms and conditions.

    The proposed changes will make it possible for consumers to exit their contracts within 30 days of the operators making changes to pricing or programming.

    This applies to increased subscription fees or "material" content being removed - especially if it is a factor in persuading consumers to sign up for pay-TV, such as English Premier League coverage.

    Consumers will also get the option of a shorter, one-year contract period.

    Housewife Maria Tan, 48, said the shorter contract period will give her greater flexibility in her choice of channels. "This way, I won't have to spend money on another year if I decide to stop watching channels in the package," she added.

    These changes follow a public consultation held from September to November 2014 with pay-TV operators, content providers, consumer and industry associations, and members of the public.

    The last time changes were made to the Code for pay-TV consumer protection was in 2011, when early-termination charges were pro-rated to the time left on the contract.

    Under new proposals, pay-TV operators will also not be allowed to force subscribers to upgrade non pay-TV services, such as Internet broadband or phone service contracts, to make changes to pay-TV services.

    Consumers will also be better informed as operators will be required to provide them with a critical information summary that highlights important terms and conditions clearly and accurately. The operators will also need to send a written copy of the contract and summary within 14 days of contracting to them.

    Operators will also have to obtain consumers' consent to continue with any trial or complimentary service before they can start charging, as opposed to automatically charging them if they fail to opt out.

    Pay-TV operators here say they are reviewing how to implement these changes into their offerings.

    A StarHub spokesman said: "We are studying the decision and are reviewing the implementation issues it may raise."