Ruslan Kogan

Ruslan Kogan

Kogan Mobile has been under intense scrutiny this past week after some users reported they had been refused reconnection to the network when attempting to recharge. Today, Kogan Mobile has released an updated set of Terms and Conditions as well as the acceptable user policy to address these issues. EFTM has all the details.

This issue first came to my attention when I received emails from two listeners to my weekly Your Tech Life podcast – one of whom had been using excessive amounts of data (he’s a truck driver who downloads movies and streams music and videos regularly). The other wasn’t quite sure why he had been disconnected but it seemed to have something to do with the number of times he had tried to recharge his service.

On both occasions their account remained in use, only until they tried to recharge. At that time they were advised by email they were not longer “welcome” to recharge and should port their number to another network.

The founder and face of Kogan, Ruslan Kogan, is pretty clear how he feels about the issues of the last week: “It’s funny how a few “journalists” wanted to take the sensationalist angle on this one. The issues in the last couple of days have only affected 0.2% of Kogan Mobile customers” Kogan told EFTM.

“In the meantime, we’ve had a record week for Kogan Mobile signups. It shows that the average consumer understands what our offer is, wants the best deal in Australia, and rightfully has no concern about the same issue affecting them. The average user (even a heavy one) is not seeking to download torrents on their mobile connection or send thousands of SMS’ per day through a SIM Box.

“Most Aussie consumers understand that even at an “all you can eat” restaurant there are some limits in place, like the restaurant owner is allowed to politely ask Homer Simpson, who eats out the entire restaurant, not to come back for more the next day.

“We’re focused on delivering the absolute lowest price we can for the 99%+ of normal mobile users. In order to deliver for them, it means we need to make sure the 0.2% who are damaging the network can’t ruin it for everyone else.”

There can be ISP One

At the heart of the issue for Kogan Mobile is their indirect dealings with Telstra. Kogan buy the mobile network access through wholesaler ISP One. ISP One has done the core deal with Telstra to wholesale its services, including to the recently launched Aldi Mobile.

With ISP One operating almost every function of the Kogan Mobile operation, it’s actually not Kogan who makes the decision on who to “kick off” the network and what to say to them when that decision is made. It could be argued that is a fault of the business deal Kogan has put in place to get into this brave new world of telecommunications. Was it perhaps naive of Kogan to allow so much control of the customer relationship to be in the hands of another company?

Kogan will today send an email to all the customers directly affected by this “disconnection” stating:

Kogan Mobile procures and on-sells an Unlimited plan with 6GB of data from Telstra’s partner. Telstra’s partner administers the Acceptable Use Policy on behalf of Kogan Mobile.

Telstra’s partner is under significant pressure to limit excess usage on Telstra’s network. This pressure is not being applied by Kogan Mobile.

You were identified by Telstra’s partner, and Telstra’s partner prevented your Kogan Mobile service from being extended without warning to you. This was not done with the authority of Kogan Mobile.

EFTM understands that Kogan Mobile has had over 100,000 sign-ups since its December launch. Today, Kogan Mobile advise that up until this point, the issue of customers being refused reconnection affects around 200 people. It’s a pretty small number for a large amount of fuss. Those customers are being offered $50 vouchers for Kogan Mobile and being told they are welcome back to the network, under a new Acceptable Use Policy.

Kogan Mobile has today updated that policy to include some very clear details. This includes its “learnings” that 1% of the user base makes up the majority of the network utilisation. Most crucially an entire section dedicated to “Inappropriate use of resources” covers off as best they can the way under which the service should not be used. Some of the inclusions in that clause include “You must not:”

stay connected to the Service continuously for an unreasonable amount of time, or download or upload an unreasonable volume of data, given the purposes for which the Service is provided to you and the usage patterns of other users (for example, staying connected continuously for several days, or downloading gigabytes of data in a short period);h) download or upload more than 400MB of data on a single day on three or more occasions in a 30 day period;

download or upload more than 1GB of data on a single day;

recharge your prepaid mobile Service Data plan more than 2 times per 30 day period; or

recharge your prepaid mobile Service Access plan more than once per 30 day period.

These all seem quite common sense, but without them Kogan has caused some concern with users and possibly tarnished their reputation in this space. More likely though there will continue to be waves of people looking to spend a fraction of their standard contracted mobile bill and switch to these low cost providers like Kogan.

The upshot of this whole issue for mobile users across the country is that for 99% of users there is nothing to worry about, you can make loads of calls, send stacks of texts and use all your data… Just not too fast.