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back to article Ofcom probe into telcos jacking-up charges halfway through contracts

Mid-contract price rises implemented by telcos are currently being scrutinised by Blighty's communications regulator Ofcom, after it found a number of problems with customer subscriptions to landline, broadband and mobile services. The watchdog said it was looking at ways to better protect punters from prices being jacked up …

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Anonymous Coward

WHAT ABOUT TV?

Sky, Virgin, BT et al, all stick you in a fixed term contract, but they still have the right to jack up the price.

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Re: WHAT ABOUT TV?

I'd like to know this too.

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Anonymous Coward

Re: WHAT ABOUT TV?

AFAIK , Sky contracts are for the initial 12 months, and are fixed for those 12 months. After that, you revert to a rolling contract, with 1 month opt out.

No idea about Virgin or BT though.

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It's hardly a "fixed contract" if one side can arbitrarily change the cost. Perhaps a change in nomenclature is called for. Shafting contract??

<looking at you, Orange>

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Vodafone are up to this as well, I have recently been contacted and informed that I too will be paying a more expensive tariff in future. I have until August for my contract to expire.

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Anonymous Coward

Whats to look into? its a one sided deal where they get to tie us to every comma and full stop but can vary their commitment at will. this stuff should have been looked at years ago.

Personally I dont need an i-shiney or anything expensive I have a budget smart on a sim only 30 day hitch as well as a payg sim in an old 6610 for those places that I suspect may flog my number to a data farmer.

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them im sure you wouldnt mind if you put £20 on your sim and they change the terms to add a daily charge etc. It is ok to say, stuff it i'll move but if ALL the companies are doing this then you are stuck really.

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Nasty trick from T-Mobile.

I have a contract with T-Mobile, which was initially a £20 a month contract. Due to changes in VAT rates it had been increased to something like £20.41 by the end of the contract. At the end of the contract I called to cancel it, but the customer retentions guy talked me out of it, telling me that he would reduce my monthly charge to "£5 a month" if I signed for another term without taking a handset. This was in fact very cheap, so I said yes.

My first bill on the new arrangement came, and I discovered that I was receiving a £15 a month "Loyalty credit" on bills, reducing the monthly charge to £5.41. Now this wasn't exactly the what I had been promised, so I grumbled a touch, but didn't formally complain.

About two months after this, I received a letter from T-Mobile telling me that they were increasing their tariffs for customers mid-contract, and that the terms and conditions allow them to increase tariffs by the rate of inflation. (They also stated that since I had just signed a new contract, they would give me a credit to the amount of the tariff increase for the next six months, just to complicate things further and hope I would not notice in six months, I guess).

However, when I got my first bill, what I discovered that they had done was increase the full amount of the tariff (ie £20.41) by the inflation rate, but my loyalty credit was still £15. So the monthly amount I will be paying at the end of the six months is actually £6.17. This is of course an increase of 14% in what I am paying, which is much more than the inflation rate. (It is also 23% more than the "£5 a month" I was paying). This is a fairly nasty trick, and it wouldn't surprise me if it was illegal. (On the other hand, what I am paying is still cheap for what I am getting).

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Hmmm

"As it stands, Ofcom's rules state that mobile, phone and broadband providers have to give their customers a minimum of one month's notice regarding any major change to contractual terms. Subscribers can then cut loose from the contract without being stung with a penalty for walking away early. "

So, if a mobile provider informs you it is raising prices you can end the contract without paying the fee?

That is interesting. Especially if they do it a couple of months into a contract you just got a really expensive phone with.

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Stop

Re: Hmmm

The important part, as with any contract, is that it has to be a "major change".

If the overall terms remain the same (minutes, data, texts) and the price increase is around inflation, you may get away with it after a lot of complaining.

If you got a new shiney phone, you would be expected to return it - the phone is "free" with an n period contract, if you want out of the contract it works both ways.

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Re: Hmmm

AFAIK sponsored contract are an exception to that rule. The least you'd have to do is pay the remainder of the price of the phone as incorporated in the contract, which can be a bit of a headache.

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Unhappy

Re: Hmmm

Well, the simple solution is to enforce fixed term, fixed price. That's fair. No wriggle room - they can't change *any* terms or costs without a papal dispensation and my permission as customer, and I have to pony up if I want to walk away early.

However, what's the chances of OFCOM sorting this out? Our most useless regulator, long in the industry's pocket, coming out on the side of the consumer? Fat chance.

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Vic
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Re: Hmmm

> the phone is "free" with an n period contract, if you want out of the contract it works both ways.

ITYF that's not the case.

The phone is "free"[1] with the contract. If the vendor breaks the contract, he has no right to reclaim the phone.

If they didn't do it like this, it would be HP, and they'd have a lot more hoops to jump through (and be regulated under CCA etc.)

Vic.

[1] For small values of "free"...

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Most consumer contracts and T&C's in a single sentence:

"We are big. You are little. Don't like it when we change the deal? Tough titties."

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I don't know about UK laws, but in my country (Norway), if the telco changes anything at all in the contract (including price), you have a right to end the contract there and then. The telco also has a legal obligation to give you a 30 day written notice to any changes.

The result is telcos having truly fixed prices on packages, and instead discontinuing packages when they want to alter prices. Those who already is on a package, can stay with it as long as they want (with the old prices), but are unable to put a new phone on that contract.

It works quite well in my experience.

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Sounds great

Unfortunately, the role of the UK consumer is to be preyed on by large oligopolies. Making a fool of the customer has become the norm, especially with banks and utility companies. Corporations lobby the government 24 hours a day so that this can continue. They even give politicians highly paid executive "jobs", in order to ensure slack regulation and toothless "watchdogs".

It wasn't always so. It has happened gradually over the last 25 years.

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FAIL

Weasel Words.....

"As it stands, Ofcom's rules state that mobile, phone and broadband providers have to give their customers a minimum of one month's notice regarding any major change to contractual terms. Subscribers can then cut loose from the contract without being stung with a penalty for walking away early"

"Raising Prices in Line with Inflation" must fall outside the definition of a "major change" if Three can include the following paragraph in their advisory on price changes earlier this year.

"Our terms and conditions allow us to raise prices in line with inflation so that we can cover our business costs. This means that you won't be able to leave your contract early as a result of this change."

Vodafone did something similar shortly after.

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Unhappy

You brits are a bunch of sissies

In Spain the Law says that a service company can change the contract at their whim without previous notification to the user, as long as they show the updated contract in their website for a month. Now beat that!

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Devil

Re: You brits are a bunch of sissies

It's a good thing for you Spansies that they still have to follow European contract law too then, isn't it!

Regardless of what Ofcom, or the contract terms say, the definition of contract in law means that if anything in the contract changes, the contract has been terminated, and a new one offered. Technically, you don't have to accept the new one, and you don't really have to accept the termination of the old one either, the other party has to either honour the original contract or buy you out of it. You ARE within your rights to say "no thanks, and - as it was you that cancelled the contract, not me - thanks for this shiny new phone". Ignore the intimidation, stick to your rights, and these companies will stop trying it on. They only do it because 99% of people take it lying down.

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Unhappy

Re: You brits are a bunch of sissies

Yes, I'm aware of that. The trick here is that they define 'showing the modified contract in the company's website' as a valid notification, which means that the user learns about the change of contract when he gets the next bill, and it's usually too late to do anything. Don't get me wrong, I'm also aware of the fact that if these cases ever go before a judge, the judge will rule in favour of the user, for the reasons you listed in your post. That's why said cases will never go to court, as the companies will accept a user's complaint if they feel that the user is serious about it, i.e. if they receive a little nastygram from the user's lawyer. Problem is, said nastygram usually costs the user as much as the disputed amount, so most people just don't bother.

I also read in some forum that this law closes the way of the small claims courts. Contrary to appearances, this law does just what it was designed to do. Sigh...

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Anonymous Coward

Networks wouldn't need to jack up prices if they concentrated on providing good coverage and service instead of experimenting with pet projects like social media and cloud services.

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Anonymous Coward

I've had Sky put the price of TV package up by £1.50 a month within 12 month contract, then shortly after saying the phone line is going up a few quid too and also Vodafone putting the price up of both my contract phones. One is a sim only package which I don't even use as I took out a new contract to get a new phone.

Result is my 30 days notice goes in with Sky TV in two days and shortly after i'll be leaving their phone and broadband package too. I also cancelled my direct debit with Vodafone and moved to 3. They can take me to court for all I care i'll fight it to the death.

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FAIL

This is actually about whether OFCOM can be bothered to do its job or not

The Unfair Terms in Consumer Contract Regulations and in the General Conditions are supposed to implement EU directives which are very clear that this kind of behaviour is unacceptable and illegal - and the telecoms firms have certainly not been giving customers one month's notice *and* telling customers that they can leave if the customer believes the changes are to their detriment - which makes the price hikes null and void. In a cosy stitch up between OFCOM and the major telecoms firms, the firms have been blatantly breaking the law and OFCOM hasn't been bothered to do anything about protecting the consumer. CISAS, etc. is a joke. If OFCOM doesn't do anything, what is the point of the £115 million budget for all of its bureaucrats? I just went to the County Court and took T-Mobile to the cleaners. The judges, at least in my experience, actually read the relevant regulations, understand contract law, weren't looking for jobs with the firms they are supposed to regulate, weren't having lunch bought by telecoms lobbyists, saw their jobs as protecting the consumer and forced T-Mobile to write me a cheque for £430. Only belatedly, years and millions of pounds later, does any lazy bastard at OFCOM get off their arses to do something about the abuse - maybe. Very maybe.

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Re: This is actually about whether OFCOM can be bothered to do its job or not

I still enjoy looking at the image of this T-Mobile cheque I very much enjoyed cashing courtesy of the nice judge in the County Court. I'm so pleased I scanned it first...

http://img21.imageshack.us/img21/5681/cheque.jpg

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Vic
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Re: This is actually about whether OFCOM can be bothered to do its job or not

> I just went to the County Court and took T-Mobile to the cleaners.

Good for you.

If more people took the same approach, we might not get shafted quite so blatantly, quite so often...

Vic.

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Happy

Re: This is actually about whether OFCOM can be bothered to do its job or not

Ahhhh.

A thing of great beauty.

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Stop

But prices aren't part of the contract

I'm sure it was on the BBC a while back but prices aren't mentioned in the contract at all and therefore don't form part of the contract. When they put the prices up they aren't changing the contract.

And that I believe is the real rub.

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There is only one contract between consumer and provider in terms of consumer protection and European legislation, whatever the telecoms companies try to claim.

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Anonymous Coward

Re: But prices aren't part of the contract

Just because the prices do not appear in the T&C's does not mean they are not part of the Contract.

The price is the Consideration in the contract and is a very fundemental, material part of the contract.

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