Apr 4, 2004 2:55 PM PDT
While some Webmasters and sponsors are still making good money with dialers outside of the USA, this scenario may change, as more and more legislatures throughout Europe are restricting dialer and premium rate number operators.
For instance, beginning on April 1st, 2004, dialers will be prohibited in Switzerland. This new law will ban all dialers, and Premium Rate Numbers (0900) are affected by the law as well. All numbers that cost at least SFR 2 per minute (approximately $1.56/minute USD), will have to announce the price once the connection is established.
Premium numbers which charge more than SFR 5 per minute (approximately $3.90/minute USD) will require that the disclosure of the price/rate be confirmed with a confirmation by the caller. The caller will have to press a certain key to confirm that he knows he will be charged this high rate.
Becoming effective at the end of 2003, the new German dialer law, Gesetzes zur Bekämpfung des Missbrauchs von Mehrwertdiensterufnummern or "The Law to Combat Abuse of Premium Rate Numbers," requires that every single dialer be registered with the RegTP (German Telecommunication Commission), and that users can easily obtain contact information about the dialer company (name, address, telephone number).
A maximum of 30 EUR (approximately $37 USD) per call, and a maximum of EUR 2 per minute (approximately $2.40/minute USD) can now be charged. 0190 numbers are now forbidden for dialers (all dialers previously used this number). These old numbers are now considered illegal, and all old customers must be cut off. The new acceptable dialer number is 0909, and the connection to dialer calls will be cut off after 60 minutes (1 hour) of use. Companies that don't follow the new law can be fined up to 100.000 EUR (approximately $125,000 USD)
The new German dialer law will lead to a drastic fall of revenue and massive charge backs. As the former Government Telco (Deutsche Telekom) will no longer guarantee payouts for these transactions, there may be a massive problem receiving monies due.
In a recent ruling, the German Supreme Court said, "If a user is not informed of the rate for the dialer, or if the dialer just established connections without the knowledge of the user, then there is no legal basis to get the money from the user. That means that users only have to pay if the knew exactly what the costs were and if they confirmed all connections." (BGH III ZR 96/03, March 4th, 2004). This will lead to a drastic rise in charge backs.
There is a new law in Spain as well. "The Modem Law" which effectively makes Premium Data almost dead. Among other reasons for the dismal speculation, this new law provides that the client will not be billed for the first 20 seconds of each connection.
These types of legal challenges are leading many Webmasters to re-create their global business strategy and think about how they will conduct business abroad in the future, and turning to affiliate programs like SEXMoney.com who offer Webmasters working in the aforementioned markets a diverse payment program. According to Matthew "Chipmunk" Sclier, Marketing & Webmaster Relations North America, "Direct Debit is currently the most popular mode of payment, due to the fact that Credit Card penetration in Germany and other countries is only at about 22%."