• January 29th, 2014
  • Darren Kingman

No penalty says OfcomOfcom, the regulatory body in the UK have said that people connected to any phone network can switch providers within 30 days of receiving a notice about an upcoming price hike. This is a law now in-place and will be music to the ears of the over 1000 people who had complained to Ofcom about price hikes after providers had signed them up on a fixed-price offer.

Hikes have become common practise in the industry (which includes TV companies), with Vodafone, BT, Sky and Virgin Media all having raised prices recently. The reason being that the companies are passing on the fact that their costs have changed onto the customers instead. However, this has been seen as unfair by Ofcom as the price hikes occur to people who are tied into a contract, with a penalty being enforced if that customer then wishes to leave.

However, now customers won’t incur this penalty if they decide that within the 30 day window, the prices are unreasonable and they’d like to leave. This not only directly benefits customers but will also make the companies involved think twice about pushing up prices in the first place or to what extent.

What isn’t determined, or at least what we can see, is what happens if a customer has a phone that is locked to the original network they’re choosing to cancel the contract with. The phone they have will likely have been subsidised at the time of purchase (often sold for “free” with a 24 month contract) but the value of the phone is then paid for over the course of the contract. With a contract now potentially being cancelled after 9 months for example, would the network then request the phone back?

To find out more, please do keep up to date with the blog and we’ll try to update you as and when we know.

Article By Darren Kingman and Image Source