Ofcom to Make Changes to Telecoms Contracts

Jan 4, 2013   //   by Daniel Morris   //   Technology  //  Comments Off on Ofcom to Make Changes to Telecoms Contracts

One of the most frustrating things that can happen to the thousands of us that take out a contract for our mobile phones and broadband, is when we suddenly get an email or text message saying that prices are going to go up. You’ve signed on for a price, why is that now going up?

It turns out that when you enter a fixed contract with a phone company, it doesn’t mean that the price is fixed – just the length of time you’re with them. So what can be done about this?

Ofcom Takes On Telecom

Right now, if your provider chooses to make a change to the amount that you are paying, there is nothing you can do but grit your teeth and pay the extra amount in order to keep your connection.

Ofcom, the telecommunications regulator, have proposed changes to the current system in the hope that this will give more power to the consumers should this happen mid-contract.

It has said that under these changes, providers will be allowed to make alterations to the prices that they are charging for their services, but must give consumers an opt-out option if they don’t want to accept the aforementioned changes to the pricing plan.

Between September 2011 and May of last year, Ofcom received over 1,600 complaints from consumers that felt this ability to change pricing was not clearly stated prior to taking out the contract.

Rising Cost of Broadband

This comes just a matter of days before BT customers will see a hike in their prices, with landline and broadband prices set to rise by 5.9 per cent – more than twice the rate of inflation – and BT Vision increasing 25 per cent in price.

These new prices will come into effect on 5th January 2013, and will be the fourth set of price hikes by the telecoms company in the last 2 years.

However, it is not only BT customers that will be feeling the pinch when it comes to their telecoms, with Virgin Media and O2 also set to up their prices in the coming months, making it even more costly to get your phone, broadband and television.

But this may change, should the new Ofcom policy come into effect, meaning consumers will have the opportunity to assess the changes to price and either carry on their contract or opt-out in search of a better deal with another provider – rather than being stuck with the new pricing structure until the end of their contract.

This would also require providers to be more transparent about the potential for prices to change during the term of contract so that consumers make an informed decision prior to signing on.

The consultation for these changes finish in March, with a decision due in June 2013, making the future look a little brighter for those that have taken out a long-term contract for the phone they got at Christmas.

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