Insights

The mobile network bundling headache continues

BILLMONITOR | OCTOBER 19, 2018

Issues with over-charging by mobile phone networks, particularly EE, Three and Vodafone, have been highlighted yet again, this time by independent research conducted by the Citizens Advice Bureau (CAB).

Echoing concerns raised by Billmonitor MD Klaus Henke in an interview with BBC’s You & Yours show in August of this year, the CAB research results reveal that around 4-million people have been over-charged an estimated £490-million for phones they already own.

The research, which was drawn from an online survey of 3,030 adults in Great Britain in July, shows that more than 1 in 3 consumers go beyond their minimum contract period.Research conducted by Citizens Advice Bureau This somewhat alarming figure confirms analysis already undertaken by, among others, Billmonitor and once again points a finger at the mobile networks and the unacceptable practice of routinely charging customers extra for handsets that have already been paid off. 

Earlier this year, Ofcom opened consultation on end-of-contract and out-of-contract notifications, with the regulator calling for communications providers to send a notification to their customers when they approach the end of their minimum contract period. However, while CAB and Ofcom agree that the status quo is unacceptable, CAB believes that Ofcom’s current proposal of sending a single notification is not enough and more robust measures need to be implemented. 

Quoted in CAB’s recent press release, Gillian Guy, Chief Executive of Citizens Advice, said:

It is unacceptable that mobile providers are knowingly overcharging customers for phones they already own. We’ve heard a lot of talk from government and the regulator but now we need action. Other companies have already stopped doing this so we’re looking for these three major providers to follow suit…

This sentiment was echoed by Digital Economy Minister Margot James during a Westminster Hall debate earlier this year.

The issue with mobile network bundling

Only GiffGaff, Tesco, Virgin Media and, to some degree, O2 offer a clear separation of the handset costs from the voice and data tariff. This conclusion was based on evidence compiled from mystery shoppers visiting the relevant websites and high street stores. Further, EE, Vodafone and Three do not seem to offer this as a service. However, they do offer different, less transparent options to address this issue.

Commenting on the issue with bundling, Henke said:

Based on our research, we can see that only one of the three big incumbents - O2 - offers a tariff that separates airtime costs and handset costs. However, O2 Refresh is only one of many other O2 tariffs, most of which do not offer this level of transparency. It is a disgrace and something that needs to be regulated as market force alone is unlikely to push the big players to become more transparent and customer friendly.

While the mobile networks are not being held to account, it is necessary for the consumer to remain vigilant.Mobile network contract Billmonitor advises users to set up a calendar reminder for the contract renewal as we strongly believe that the networks have no incentives to look out for the user – all they would do is reduce their own revenues and profits. Therefore, until mandated by law, alternate systems need to be utilised to safeguard against overspending. 

As always, The Billmonitor software is free to use for consumers and our analysis will always show the user’s contract end date. If a user has a contract with Vodafone, EE, O2 or Three, they can obtain a free assessment on the Billmonitor consumer site here.

CAB article here
Earlier Billmonitor article here


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