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back to article Shops 'mislead punters' over phone contract prices

Many phone shop staff deceive customers over the potential for price rises during the length of contracts, it has been alleged. A whopping 82 per cent of sales staff in mobile outlets gave incorrect information about potential price rises when attempting to close a phone-contract sale, consumer information company Which? claimed …

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Anonymous Coward

Too right, this practise sucks. I signed up to a 2 year with Orange through CPW, 2 months in, my bills went up. I argued with CPW arguing a verbal agreement over the phone was a contract, they just said, it's Orange not us. Orange said our T&C's allow it.

Roll on May 2013, Orange will have lost my business, the wife's business and they've already lost my broadband/landline business.

I've learnt, from now on, I'll the buy the phone myself and get a 30 day rolling contract, I am not getting stung like this again. SCREW CPW & ORANGE.

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Go

"I've learnt, from now on, I'll the buy the phone myself and get a 30 day rolling contract, I am not getting stung like this again"

Almost always the cheapest option regardless.

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Agreed

Used to have a contract that i took over from an ex-employer, the teleco pulled the same shit so towards the end of the contract i checked out the compatition and evey one of them had a "we can fuck you clause", in fact every one of them had multiple "we can arse rape you sucker" clauses. Now im on PAYG with a diary containing the numbers of all the people I give a fuck about.

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Pint

Re: Agreed

I sense a lot of anger in you mr(s) a_been

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Anonymous Coward

"buy phone... almost always cheaper"

Except when it isn't.

Galaxy S3 handset £480 + cheap tariff £10 * 18 months = £660

Galaxy S3 on contract, better tariff £31 * 18 months = £558

Which is cheaper over the term again?

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FAIL

Re: "buy phone... almost always cheaper"

"Galaxy S3 on contract, better tariff £31 * 18 months = £558"

And where are you getting a free Galaxy S3 for £31 per month? I see O2 doing a £31 18 month contract, but they want £299 for the phone upfront. Three do a £31 contract, but for 24 months, and still want £99 for the phone.

So yeah, your way is cheaper if you ignore some of the costs.

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Meh

Technically

Technically it is an unfair contract term that puts the user at a disadvantage.

I'm surprised that it has never been tested in court because I am sure it would be winnable.

Class action starts here!

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Re: "buy phone... almost always cheaper"

Add the vat

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Anonymous Coward

@ Annihilator

Actually, I got it from buymobilephones.net . My friend who is sitting next to me got the same deal as a T-mo upgrade.

£299 upfront? ROFL.

You may also be aware that it is possible to go into a shop and TALK to someone? They are always prepared to do you a deal, that's how I have always had the top handset for free on an 18 month contract for as long as I can remember. In some cases there has even been cash back in it for me as well :)

24 month contracts - I thought only iPhone fans would be prepared to bend over that far.

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Facepalm

Re: @ Annihilator

Show me the link for your "deal" then on buymobilephones.net then?

http://www.buymobilephones.net/mobile-phones/Samsung/Samsung-Galaxy-S3/Vodafone/Vodafone-Choice-300-(18mths)-Internet/13732577 is all I can find. As for "upgrades" on existing networks, they take into account your mug-factor, i.e. how much you've (over)spent to date (compared with how much you actually got).

Even if all that were true, you can equally go into a shop and TALK to someone on a SIM-only deal to get cheaper than what you're quoting.

Mobile companies aren't charities, they're giving you nothing for "free".

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Misleading is wrong but...

This is an actual legally binding contract so it's really up to the punter to read it, and they should.

This isn't like a software EULA where no-one gives a crap.

I can't speak for all tariffs on all networks but my T-Mobile contract does specify that they can increase prices, but it also says if they do they will always contact me in writing and give me the opportunity to leave or change tariff with no penalty to me. They've done this on both occasions they've increased prices on me over the years though I've never actually chosen to leave.

Some people will likely disagree or downvote me for this but most increases mobile network makes are relatively minor, the last few times it's happened to me or people I know it's been a matter of £1 or less on a £20+ a month tariff.

My personal feeling on this is that if you can only barely afford your £20+ per month tariff and an increase of <£1 makes it unaffordable for you then you are not really in the position to be on a contract tariff anyway. (what if you called accidently or intentionally call/text numbers not included in your plan, how would you pay for those on your bill?)

If you're not in a position to handle potential additional charges on your contract don't get a contract tariff, PAYG exists for a reason.

If you're finances are so tight

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Re: Misleading is wrong but...

"it also says if they do they will always contact me in writing and give me the opportunity to leave or change tariff with no penalty to me."

Does it? You surprise me, since that's one of the things people are demanding.

Yes it is a legally binding contract, so people should be aware of what it says. However, giving the service provider all of the rights and none of the liabilities is hardly a fair deal. Just look at what happened when O2 went tits-up a month or so ago. They didn't have to give any kind of compensation despite people paying for a service they were no longer receiving. That fact that O2 _chose_ to do the sensible thing, from a PR point of view, and gave people nominal compensation is neither hear nor there. I'm not even sure if people on Tesco Mobile or its ilk got any kind of compensation at all.

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WTF?

Re: Misleading is wrong but...

My finances are my business and not the networks. Also, contracts are not legally binding if they are unfair - this practice should be deemed unfair.

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Re: Misleading is wrong but...

Good point. A contract can say more or less anything. If it's found, legally, to be unfair it gets voided.

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Re: Misleading is wrong but...

Richard,

I'll back Phil here, when T-Mobile want to increase my tarrif they have written to me and given options in the manner Phil describes. My brother is on Orange though and he doesn't ever recall being told in advance of a price increase with them.

I do agree with your second paragraph, it does seem like they hold all the cards when it comes to the contract.

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Coat

Re: Misleading is wrong but...

"My personal feeling on this is that if you can only barely afford your £20+ per month tariff"

Its not about the actual cost, its about being fair. If they advertise a contract at £25 per month on a 2 year contract, that's what I expect to pay.

now here's a thing, If the company or its agent vary that contract, for example tell you that it wont go up, and you have that in writing or a verbal agreement, (record the phone call) then they have varied the terms and conditions and need to give you it in writing within 14 days or the whole T&C becomes null and void. If the carphone warehouse sales person admits he told you it wouldn’t go up, but then says afterwards it was a mistake, it may even be a honest mistake, then that contract has been miss sold and you can get out of it.

I am on three, and according to the coverage map I should get very good signal indoors, fact is I dont, and after a lot of calls and arguing I accepted an offer of a reduction in the price of my price-plan over getting out the contract. I currently pay £4 per month for 500 cross network minutes, unlimited texts and 3GB data.... there is no way I am going to upgrade, Iwill just buy a new phone as and when I want one. If you time it right, you can sell your old one and not take too much of a hit.... I will replace my old phone with a new one every 8 to 10 months and loose out on less than £100 quid.... over the year, it costs me around 15 to £20 per month for the latest and greatest phone where everyone else is paying £35 to £45 for the same deal.... even without the reduction it would still cost less and I dont have to wait 2 years to get a new phone, an added bonus if I hate the handset got...

now where is me keys and where is me phone !!

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Re: Misleading is wrong but...

"This is an actual legally binding contract so it's really up to the punter to read it, and they should."

Whilst true, the fact that phone companies own employee's are stating that no price increases are possible when they know they are, is misleading, dishonest and should render the contract invalid.

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Re: Misleading is wrong but...

"My finances are my business and not the networks."

Actually no, they are the networks business.

They become the networks business when you agree to the credit check prior to signing the contract.

This is nearly as silly as saying when taking out a loan or mortgage that your finances are none of the banks business. Your agreeing to pay for something under a monthly contract, so they expect to be reasonably certain that you can afford to pay for it.

As for it being an unfair contract term. It's not really that unfair to increase the cost of a service if the cost of providing it goes up (not saying that is why they increases prices but anyway) and personally I don't think it's unfair to do it when it's clearly stated in a contract you've agreed to.

If you find it so unfair stop taking out contracts, if enough people stop signing them perhaps they'll change the terms.

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@Churro Joe

*My finances are my business and not the networks*

Actually, as you are entering into a credit agreement with the network your finances _are_ their business...

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Re: Misleading is wrong but...

Potential increases are prevalent in most mobile contracts, but only to the rate of inflation (and capped at 10%). To sample O2s:

"5.3 You can end this Agreement without having to pay the Monthly Subscription Charges up to the end of any Minimum Period you have left, if:

(a) we increase your Monthly Subscription Charges by more than the Retail Price Index (RPI) annual inflation rate at the date we notify you of the applicable price increase; or

(b) we increase any of our Charges (apart from for Additional Services) in such a way that would have increased your total bill for the immediately previous month by more than 10% (if the increase(s) had applied for the whole of that month)."

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Coat

Re: Misleading is wrong but...

Yes Tesco mobile is giving compensation - I believe it is going to be shown on the billing cycle in Sept.

One more reason I am glad I dumped contracts with handsets years ago and decided to buy my own and head for a 30 day roller...

I know a young guy who has been in hock to the big networks since he was 18 because of his lust for the latest shiny shiny... he must love being screwed!

Mine is the coat WITHOUT the networks hand deeply inside the pocket

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Re: Misleading is wrong but...

"As for it being an unfair contract term. It's not really that unfair to increase the cost of a service if the cost of providing it goes up"

Oh, but it is. In return for signing their lives away for 18-24 months at a time, it's not unreasonable for a customer to expect that the price they agreed to pay at the start of that term will be the price they're still paying at the end of the term - especially if that's what they've been told by a salesdroid... If the telcos want the flexibility of changing their prices on a yearly/half-yearly/quarterly etc. basis, then that should be the maximum contract length on offer.

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Re: Misleading is wrong but...

I love it, shit loads of down votes for saying that a company has every right to be interested in your finances if you're entering into a monthly contract with them.

No wonder this country is in a fucking state it's in if the citizens haven't got the slightest clue about finance.

"So long and thanks for all the fish"

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Flame

And this is new!

This shit has been going on from at least the 80's, I remember when I went into a shop to buy a BBC model B with my mother, they tried to sell us some POS saying it was the same as a model B because it could run BBC software which changed to "it runs BASIC".

PROTIP : BBC didn't produce software at that time.

Seen the same when a friend wanted to buy an iPhone and the shop tried to sell her a "Galaxy iPhone" that was better because "It could run Android as well". I used to think this shit was down to poor trainning but it's not, it's down to commisions and companies making it clear that they dont give a fuck if the sales people lie.

The only way this shit will stop is when directores have to pay out of their own pocket for the fines their companies get charged when comitting fraud and when insurance companies do not have to pay out when they can prove "on the balence of evidance" that the directors didn't give a shit about making sure their sales staff where honest. At the moment, lieing is a "cost of business" and if you get fined, no problem as only the shareholders get fucked and the directors are insured as part of the job contract. It's fucking pathetic.

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30 day rolling Sim only contacts and buying your own device is the way ahead

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YEP

Works for me and it seems most everyone I know does the same unless they use a company phone. Oh and local Govenmeant phones, that seems to be the gold standard for getting other people to pay for your phone.

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Anonymous Coward

Are you sure?

Every time I've looked at getting a new phone in the last 10+ years, I've shopped around and found a contract including the phone that once you total the line rental over the duration, the overall cost is less than buying the phone outright... normally about £20 cheaper, but it varies enormously... and you get all your usage included.

So, for me that is the way ahead... OK, it opens me up to being screwed by the network, but if they did that heavily enough, I would pay off the remaining months and still be quids-in, having spent less than buying the phone initially anyway (just not get the benefit of the usage etc).

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Re: Are you sure?

This is the thing - every time someone compares the price of contract vs. PAYG they never seem to take into account the 'free' call minutes, texts and data allowance that come with the contract plan or the value of up-front cash outlay. When looking at the pros and cons of contract vs. PAYG earlier this year I found a clear advantage for contract deals for someone in my position*.

To really see how much each costs you need to add up:

- The up-front price (usually free for contract vs. cost of handset for PAYG)

- How much interest you pay / lose over the period (i.e. How much more than the price of the handset are you paying over the course of a contract vs. how much interest you are paying your credit card company / interest you would have earned in the bank on the up-front cost over the course of the same PAYG period)

- The monthly charge (for either the contract or the PAYG rolling 30 day over the entire contract length)

- The 'value' of included time/text/data (how much it would cost you to get the same deal by each method)

As can be seen, a couple of these vary significantly for different purchaser circumstances:

- Those with plenty of ready cash will lose much less in interest over the comparison period than those buying up-front via credit (low bank savings interest rates mean keeping the up-front cash in the bank instead of buying up-front means that you are not really losing out on much interest whereas a high rate of interest on credit card payment would soon eat up any saving over the contract period)

- You need to have a contract who's 'free' allowance closely matches your actual usage rates - there's no saving to be made against PAYG if you are only using 10% of the 'free' stuff in your contract.

To summarise - people with the means to buy up front without resort to credit and who have low-ish usage rates are better off going down the up-front handset purchase with cheap PAYG rates, whilst those with lesser means who would otherwise resort to credit to fund up-front costs and have higher usage rates are better getting a contract with a free handset.

* Usually missionary but occasional '69' for birthdays and christmas.

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Anonymous Coward

T&C

That's right - a reasonably clear statement of this (courtesy of CNET);

"We all have the right to get out of contracts if they're changed in a way that will cost us more. It's all thanks to the Unfair Terms in Consumer Contracts Regulations 1999, which governs contracts that the customer isn't able to freely negotiate.

In the T-Mobile case, for example, although the network said it wasn't going to charge you if you go over its new 500MB-per-month cap, it would throttle some services on your phone. And people who spoke to the network said they were advised to buy a more expensive deal if they tend to go over the cap often.

That means if you use bags of data, the service you receive from T-Mobile would change, or you'd have to pay more. In the lawyering business, that's what they call 'material detriment' -- and that's the key to breaking your contract under the Consumer Contracts Regulations."

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Re: T&C

"In the lawyering business, that's what they call 'material detriment' -- and that's the key to breaking your contract under the Consumer Contracts Regulations."

Do you know of any basis where that claim can be back-dated?

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Old joke

What's the difference between a car salesman and a computer salesman?"

Ans; The car salesmanperson knows when they're lying.

The problem is that the minimum wage, "straight out of school and into a shiny suit" yoof that you find in phone shops¹ hasn't really got much of a clue. They'll say pretty much anything to (a) gain a sale and (b) maximise its value.

Going into a shop, or engaging with a tele-sales person to any greater level than "I want THAT ONE" will lead to disappointment and possibly bitter recriminations.

[1] and in most other sales emporiums where the products use electricity

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Re: Old joke

Some people are just clueless.

When I signed up with Orange France, I asked if my phone's internet would support ssh and sftp among other weird stuff. The girl I spoke to said "it is a phone, it has a web browser" (I guess failing to understand how email arrives). As it turns out, that stuff does work.

When I renewed my phone, the new contract was the same as the old except Deezer was no longer a freebie. I queried getting Deezer, and Orange's own POS machine said that Deezer was incompatible with my phone (Xperia Mini Pro). Oh well. Went home, turned on the phone, saw the Deezer app, and signed in and used the service to the remaining days of my previous contract.

Obviously it might suck to be somebody feeling hoodwinked by a salesbod, but the fact is... many of them are either stupid or simply don't know. This doesn't make it right, but there's a difference between being malicious and being stupid.

Here's my favourite anecdote. "PC World" in Guildford. Circa Y2K. I was looking for a smallish (~0.5Gb) harddisc for my Acorn RiscPC. I asked the guy at the counter because all the stuff on display was ~2Gb and I didn't need anything that large. The response was astonishing. I was told, by an official uniformed salesperson, that if I needed to add an additional harddisc to my Amiga, to buy one of the original Creative Soundblaster cards because it has an IDE port on it. I thanked the guy and left.

Debugging: Let's see. First, he means SoundBlaster Pro, not the original. Second, it is a proprietory interface of some sort, not IDE. Third, the Amiga doesn't have an ISA bus (without some sort of Zorro-to-ISA hack). Fourthly, Acorn and Amiga are very definitely not the same thing. Finally: I asked if there was a smaller size harddisc, a question never answered. Hmmm... Really, five glaring errors in one short discussion. I wonder if he had to go on a course to learn how to be that stupid (remember, he is selling computer bits, and he gave an authorative (if totally moronic) response). I'd have been tempted to shout "FAIL!" and walk out, only we didn't have that word back then.

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Price rises or service cuts

Are the having to raise prices because last time they effectively did the same by cutting data allowences to useless limits?

"I've learnt, from now on, I'll the buy the phone myself and get a 30 day rolling contract, I am not getting stung like this again"

"Almost always the cheapest option regardless."

So glad I am out of all that bollocks now. Also, to anyone hoping to get some joy through OFCOM - save yourself the bother, they are a bunch of toothless idiots who are easily bamboozled by the phone companies' circular arguments.

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Err

Am I the only one that thinks a single increase in line with CPI is fair?

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Re: Err

Yes, because you agreed to a certain price for the term of your contract. Now if after the contract ends they want to put the price up in line with CPI, or the phases of the moon - that's fine.

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Anonymous Coward

Re: Err

No, I think all these whiners need to stop quibbling about a few pennies.

My contract went up. It will cost me about £15 more over its life. Big whoop.

Still saved over £100 compared to buying the handset up front, and I get a superior tariff and 0% credit.

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Re: Err

"Still saved over £100 compared to buying the handset up front"

Did they explain exactly what they are charging you for the phone and what they are charging for the service out of the amount you pay?

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Anonymous Coward

Re: Err

The tariff is the same no matter what handset you take. If you have your own handset I believe they knock £5 off.

I'm not sure what you're trying to point out anyway. I am in general frugal; I have done phones this way for 14 years; I am confident it is the best deal for me. I have always had the latest handset and never longer than 18 months contract. Over an 18 month term it works out about £100 cheaper and I get interest free credit. No-brainer.

Usually I get a deal by going into a shop and talking to someone. You don't need to be pushy to get a deal. One time I got everything I wanted, plus accessories and £70 cash back.

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Hardly surprising - staff in many mobile phone shops are woefully lacking in even basic knowledge. My mother was recently told by the "salesperson" in carphone warehouse that there was no way for to keep her number when changing networks. I was gobsmacked.

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Rolling contracts. These days, the only way to fly. If the operator does something scummy or if a better deal comes along you can bail with the minimum of fuss. Therefore it's in the operator's best interest to not do anything scummy.

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MrT
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They should also...

... send at least a text or email (preferably letter) to confirm the details of any new contract - even the basics, like the monthly costs, discounts, out-of-contract tariffs etc. Otherwise you end up relying on the recording of the phone call, kept for training purposes of course, if that was now the new contract was arranged.

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Obligatory Giffgaff mention

And if they do treat me badly, I can just leave.

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Re: Obligatory Giffgaff mention

Only one change I've noticed in the 10 months I've been with them, and that was ...

shock, horror ... brace yourself ...

an 8p/min reduction in the cost of calling 0845 and 0870 numbers.

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Re: Obligatory Giffgaff mention

Can't understand why anyone would downvote my post there. I wasn't saying "Giffgaff > * loosers \o/" or anything.

Anyway, you just reminded me of another + point for GG. Free 0800 and 0808 calls. Saves me a fortune calling into conf calls. (I have no desk phone at work and no company mobe) I use it for hours at the moment.

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Anonymous Coward

Colour me surprised

I know of a member of staff at one mobile phone shop (Not reseller, official store) that sold a broadband contract to an old lady who didn't even have a computer and certainly didn't know what Broadband was.

So no, I'm not at all surprised that the misleading extends to all areas of their business.

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Trollface

If it was a loan...

Time for the mis selling compensation bandwagon to strike again?

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Re: If it was a loan...

I bet the networks would pull their fingers out and filter that SMS spam...

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They learn from the best

That best (or worst) being BT, who reward customer loyalty by invariably imposing ridiculous tariff hikes part-way through the discounted term - and invariably screw up the discount itself, but that's another issue.

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Devil

T-mobile

Tried to screw me over recently offering a retention deal. Quoted a 250MB/month data deal as "unlimited internet" when in actual fact once you hit the limit the only thing they dont choke is web and email.

Hit the limit with one decent trip with Google navigation on Satellite view the next day - rang straight back up and cancelled and jumped to GiffGaff.

Bastards, the lot of them!

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Simple...

The price per month should have an asterisk and on the price ticket it should say '* operator may increase costs during the term'. Or it should just say "30ppm variable" or similar. Anything less visible, especially burying it deep in the contract legalese should not be considered fair - and therefore should not be binding.

Let's face it, to really understand most of the contracts we sign, we would probably need to pay a lawyer 500 quid or so to read it. When one is arranging a mortgage, that's reasonable. When purchasing a 500 quid phone it is completely out of the question.

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