CATHERINE McLEAN
From Thursday's Globe and Mail Last updated on Tuesday, Mar. 31, 2009 10:12PM EDT
When customer complaints first started rolling in about Telus Corp.'s new wireless porn service, the company viewed it as a passing phase.
The Western Canadian telephone giant started with an "education" campaign to address the concerns. Throughout February, it repeatedly pointed out that adult content can already be accessed on wireless devices through Web browsers, and that its service was legal and had controls to prevent kids from viewing nude pictures.
But top executives, who started holding conference calls a few times a week to discuss what was quickly becoming a lightning rod for controversy, could see the strategy wasn't exactly working.
"Yes, they knew and understood what we were saying, but that didn't change their view as to whether or not we should continue to offer the service," said Janet Yale, executive vice-president of corporate affairs at the Vancouver-based company.
Faced with snowballing complaints from both consumers and corporate subscribers, along with a very public rebuke from the Roman Catholic archbishop of Vancouver, Telus chief executive officer Darren Entwistle bowed to the pressure on Monday. In an hour-long call, a handful of Telus executives, including Ms. Yale and Mr. Entwistle, discussed the logistics, including timing and a communications plan.
On Tuesday evening, the company with the cuddly spokesanimals killed the service without fanfare. But word soon leaked out that the first adult-content service offered by a wireless carrier in Canada and the United States was no more.
"We heard from a broad range of customers . . . who made it clear they were not supportive of this initiative," Ms. Yale said yesterday. "We listened to our customers."
Several hundred consumers and corporate clients complained about the service, a handful cancelled their Telus service, and one client even filed a lawsuit.
The decision to pull the service met with approval from different sources, including Vancouver Archbishop Raymond Roussin, who last week called for Catholic churches and schools to stop buying wireless services from Telus. "I am pleased and grateful that Telus has decided to remove itself from the business of profiting from pornography," he said in a statement.
Calgary's influential Catholic Bishop Fred Henry, who also publicly criticized Telus and was poised this weekend to issue a pastoral letter urging parishioners to show their displeasure, was satisfied with Telus's decision.
"I think it's just time we stood up and said enough and so they've heard us," he said yesterday.
However, he added "it's a little disconcerting that it takes some consumers reacting to a business decision rather than it being an ethically motivated decision on behalf of the company itself."
Nita Vammus, a 61-year-old grandmother of three who lives in Mississauga, said she was encouraged Telus responded to the public's concerns. She sold her Telus shares -- worth $11,000 -- last week as a response to the porn service.
"It's in your face," Ms. Vammus said. "People can be right beside a person sitting on the subway who's doing it. It's not like someone sitting in the privacy of their own home."
The outcry wasn't surprising, said Kaan Yigit, president of Toronto research consulting firm Solutions Research Group Consultants Inc.
The youth market is the fastest-growing segment of the wireless industry, according to Mr. Yigit. Since it's a private device, it's harder for parents to keep control over the content their kids access on cellphones than on the Internet or television, he explained.
"It was a decision waiting for a backlash," Mr. Yigit said.
Cultural differences also likely played a role. North America, including parts of Telus's home base in Alberta and British Columbia, tends to be more socially conservative than Europe, where cellphone porn is a big business.
Telus, which sells its wireless services across the country, said several thousand subscribers used the adult-content service, which cost between $3 and $4 for a photo or short video clip with partial or full nudity of men and women.
A spokesman for Telus wouldn't comment on the revenue targets. But porn on wireless devices is a booming market, expected to generate billions in revenue worldwide in coming years.
For Telus, it was part of a strategy to further expand the content offered to its customers on different screens, whether it's the Internet, TV or cellphones, Ms. Yale said.
"It was a business decision that was taken in an informed and careful way," she said, conceding that it was "the nature of the reaction that we didn't anticipate."
She wouldn't close the door on ever offering a wireless porn service again. "It's not appropriate for any business to say never means never."
At least one customer still doesn't think Telus is doing enough. Gordon Keast, a 54-year-old public-relations executive from White Rock, B.C., launched a lawsuit against Telus last week for $3,000, alleging breach of his wireless contract.
While Mr. Keast approves of Telus's decision to drop the service, he's going ahead with the suit. (A Telus spokesman said the company will contest it.)
He believes wireless companies must do more to prevent children from accessing porn on cellphones' Web browsers.
But Ms. Yale said blocking access to websites is a "contentious issue," although Telus does so in some cases like child pornography. Telus does let parents turn off the Web browser on their kids' cellphones.
With a report by Dawn Walton
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