Text-based promotions under government spotlight

Marketing messages may contravene Gambling Act, says Internal Affairs

The Internal Affairs department has sent out a reminder to businesses and mobile network operators to be careful about how they structure text message-based promotions.

The upshot is that if such promotions aren't run to ensure they comply with the Gambling Act, businesses and carriers could be fined.

A statement from the department advises anyone considering running a texting-based promotion to seek legal advice before doing so and outlines some of the do's and don'ts of promoting products via SMS.

Don'ts include raising the price of sending a text message beyond the norm and holding a contest where participants merely have to send a text message to go into a prize draw.

However, it's OK to automatically put text senders into a prize draw if the texts have been sent for legitimate reasons, ie business or calling friends.

The department says the reason for the reminder is that it's keen to protect young people, traditionally big users of texting services, from the dangers of gambling.

"Young people... are less likely to know how much money they're losing when it appears that no money is changing hands, ie the losses are charged to a telephone account or credit card."

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Tags smsTXTgamblingInternal Affairs

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