From: Sex Money
Date: March 19 2004

Global News Update: Are Dialers Dead

(Ft. Lauderdale, FL) - March 19, 2004 - Some webmasters and sponsors are still making good money with dialers outside the USA - but this scenario will change.  More and more legislations throughout Europe are going to ensure that the dialer and premium rate numbers will become an enemy to be vanquished.

This situation will affect…

Switzerland
Beginning April 1st, 2004 - all dialers will be prohibited in Switzerland.  This new law will ban all dialers.
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 first thing when 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 to be confirmed with a special confirmation by the caller.  The caller will have to press a key to confirm that he knows he will be charged this high rate.

Germany
The New Dialer Law
The new German law - Gesetzes zur Bekämpfung des Missbrauchs von Mehrwertdiensterufnummern or "The Law to Combat Abuse of Premium Rate Numbers" - became effective at the end of 2003, requires the following rules:
"       Increase user rights
"       Every single dialer must be registered with the RegTP (German Telecommunication Commission)
"       User can easily obtain information about the dialer company (name, address, telephone contact)
"       A maximum charge of 30 EUR (approximately $37 USD) per call, maximum of EUR 2 per minute (approximately $2.40/minute USD)
"       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
"       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) a drastic fall of revenue and b) massive charge backs.  As the former Government Telco (Deutsche Telekom) will no longer guarantee payouts for these transactions, there will be a massive problem receiving monies due.

Ruling from the German Supreme Court (Bundescgerichtshof BGH)
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." (File Number: BGH III ZR 96/03, March 4th, 2004)
This will lead to a drastic rise in charge backs.

Spain
There is a new law in Spain as well.  "The Modem Law" which effectively makes Premium Data almost dead.  Among other reasons, this new law will provide that the client will not be billed for the first 20 seconds of each connection.

The Overall Effects…
Sponsors and webmasters who were enjoying increased revenues from dialers will get less money from these alternative methods.  It is no longer a good and long-lasting source of income from European traffic.  Webmasters should re-think their current business model and use a sign-up or membership program in order to generate income on a long-term scale.

Affiliate programs like SexMoney.com, offers webmasters who are working in the aforementioned markets, a diverse payment program.  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%.  

It is time to re-create your global business strategy and think about how you will conduct your business abroad in order to continue generating income from your traffic in the future.

Visit www.sexmoney.com for more information on how you can better target and convert your global traffic with our multi-language, multi-country and multi-payment processing programs.

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