ACMA makes web marketing illegal

We received an Email from Hyarchis Company Ltd who are a provider in the SMS business. They were subject to a rather random decision by ACMA, issuing a "Formal Warning" for an alleged breach of the Spam Act. 

Not only that this Formal Warning is in relation to only ONE complainant (where is the public interest in that?) - the scary part is that ACMA obviously does not understand the businesses it regulates, as the warning was issued for the sending of an obligatory message.

Hyarchis sent out a confirmation message to a customer as it is required not only by carrier guidelines, but also by the so-called MPSI-Scheme - which has been designed by carriers, aggregators and ACMA themselves.

One also has to ask himself - is this the big issue they currently deal with? I mean, if a "Formal Warning" for the sending of one single message makes it into a government authority's Media Releases - what the hack are these guys doing all day?

Here's the mail we received from Hyarchis:

"We are a content provider in the MPSI. We are an active member of the Communications Alliance. We comply with all laws, industry codes and regulations in this country.

Despite all this, we were blamed publicly today by ACMA in a Media Release where we are accused of marketing spam. This is absolutely ridiculous, as all we were doing was following the industry guidelines.

Let us explain: When soneone in Australia surfs the web and in particular free sites, then these are - as you surely know - financed by advertising. WE do - as many players in the industry - spend a significant amount of our budget on web marketing to attract new customers to our services.

If a customer comes across our offer and is attracted, the MPSI industry guidelines request the folllowing steps:

(a) Customer has to enter phone number

(b) customer has to tick off Terms and Conditions

(c) Customer has to click on "send" button

Once that all has been fulfilled, the MPSI guidelines require that a message is sent to the customer to ask him to confirm the request. This step is compulsory to ensure that the real account holder received the compulsory message as described above.

Only once he confirms this by sending another message from his handset, or entering a unique code (which was sent to his handset) into the web marketing, he will be entered into the service.

In our case, obviously someone who was not the account holder though it was a funny idea to enter a random number (0411 111 111) into one of our web ads. Of course, the real account holder received the compulsory message as described above.

The customer immediately complained to ACMA. ACMA then started an investigation and obviously - after extensive correspondence - found us guilty of spam for sending this compulsory message. The reasoning was as follows:

"The unique nature of this electronic address (0411 111 111) however was not identified by Hyarchis as one which could be potentially entered by parties who are not the account holder of the electronic address."

We (Hyarchis) replied inter alia as follows:

"(...) It lies in the nature of the medium that abuse by persons using the website or web advertising cannot be entirely avoided by the advertising company, meaning it is impossible for advertisers to stop incorrect mobile phone numbers being entered into web advertising or web pages (by mistake or on purpose and by persons known or unknown).

The advertising company will, in accordance with the guidelines, send am essage to the number entered into the web ad. If and only if the customer then proceeds as instructed in the message, will the customer be entered into a service."

ACMA did not find this reasonable. The decision was furthermore based on "significant contact" ACMA had with the account holder - which we do not see as a legal foundation, but more as a factor that supports our view that the decision has not been made on an objective basis.

However, we are not surpised the account holder had "significant contact" with ACMA, as his mobile number is extremely "fancy" - and therefore would be frequently entered by "funny people" into web ads.

BOTTOM LINE: Everyone who wants to do web marketing in Australia from now on has to employ hundreds of thousands of staff out there to sit besides every soul surfing the web here 24/7/365. As soon as they enter a phone number into a web ad, they have to verify that that they are the account holder. The process is simple: They just have to ask for a photo ID and the customer's contract with the carrier, so the marketer can prove the person entering the number is the account holder."

We agree with Hyarchis - this is ridiculous.