The Malta Communications Authority is considering fining Melita €4,000 and is also officially to express its concerns to the Consumer and Competition Division about the wording of promotional material Melita mailed to customers in May, The Times Business has learnt.
In a letter sent to subscribers, Melita invited customers to bundle TV, internet, fixed telephony and mobile services into a single package - the XL Big Savers package for €80 a month.
For an extra €0.89 a month, Melita said subscribers could enjoy "Malta's most comprehensive digital TV package". The extra charge came into effect on July 1 but customers were given 30 days to contact the company to opt out of the offer.
Alternatively, Melita offered to continue to service customers with the XL television package at €29.99 per month.
An MCA spokesman confirmed that rival company Go lodged a verbal complaint with the authority saying Melita was disguising a price hike under an offer, but no protests were received from Melita customers.
The MCA has warned Melita that it is considering imposing an administrative fine. The spokesman pointed out that the sanction did not relate to the change in tariffs for Melita's L and XL television packages but to an alleged breach in the 'Decision on the Modifications to Terms and Conditions of Subscriber Contracts'. Operators are obliged to inform the MCA a day before issuing a notice to subscribers which proposes changes to existing contracts of service. Melita could be fined €2,000 for two instances of non-compliance for each TV package.
The spokesman said the process was initiated before Go voiced its objections to the Melita offer.
Melita is still in time to argue its case with the MCA.
Asked for Melita's reaction, a company spokesman said the reason the MCA was considering imposing an administrative fine was unrelated to the wording of the letter.
"The contention lies between MCA and Melita and is completely unrelated to the wording which was sent out to clients. There is absolutely no contention between Melita and its customers," the spokesman stressed.
He added that the letters were sent to Melita's L and XL TV customers "as an explanation of a re-dimensioning process of the respective TV packages".
"As a matter of fact, a large portion of these customers are now enjoying more local and international channels. The channels were added a long time ago without any additional request for payment," the spokesman pointed out.
"The letters were also intended to show customers how to save more money on their home entertainment and communication services - substantial savings ranging from €123 to €314 every contract period and therefore eliminating the minor price increase introduced on certain TV packages. The letter explained that Melita customers will save substantial amounts of money when using two, three or all four Melita services as opposed to using only one service.
"In both letters, all customer safeguards were in place."
Last week, Melita said the MCA's annual report for 2008, published three weeks ago, confirmed that the company was the preferred provider for television and broadband internet services. The MCA statistics also confirmed the fast growth rate of Melita's fixed telephony services, citing competitive prices and consumer-friendly offers as the main factor pushing prices down and usage up, Melita said.