Mobile companies overcharging customers after contracts end

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Vodafone, EE and Three are continuing to charge customers for the mobile phones they buy as part of a contract, even after the cost of the handset has been paid off, research suggests.

Citizens Advice found that customers who do not take out a new contract are paying an average £22 extra a month.

The government said the mobile firms needed to inform customers when they had paid for their handsets… More at the BBC.

I’m not convinced the word ‘overcharging’ should be used here. Is there no emphasis on an adult working this out for themselves?

3 thoughts on “Mobile companies overcharging customers after contracts end

  1. I have more sympathy. For one thing, have you ever tried to really read a click through *contract*? Has anyone?

    Even beyond that, at the level of how much we *can* expect people to have a macro level understanding of their financial engagements– as a guy who does some UX and UI, I understand that people don’t always approach these issues with the analytical mind you imply they should. Carriers don’t go out of their way to explain why a minimum contract length would be what it is, in terms of paying for the phone, or clearly set out options of “pay for the phone and get a cheaper plan, or pay this bundled price, but as long as you remember to shift gears at the end of 2 years you can pay less”

    In general 2 years is a hell of a long time to set a reminder of “oh I will have met a minimum contract length so I should check to make sure those cheeky bastards get me on cheaper, bring your own device plan” – even beyond understanding such plans are likely to exist that implies every such person has a reliable 2-year-ahead calendar system (for non-techies, aren’t they more likely to use a paper datebook that only covers at most a year ahead anyway? But a clear win for us PDA-happy old timers who have been using electronic calendars with decades of look ahead for years).

    Aside from the tracking challenge, for people more attuned to gadgets, and who have been looking forward to the 2 year upgrade cycle with baited breath, that’s an advantage that they’re motivated to set that reminder, but for non-techies who have a more gently used phone that could still suit them for a while, this is an abuse by the providers.

    So I’m surprised you two are so harsh about it, maybe I’m just a bleeding heart 😀

    In general I do think the trend of splitting cell service from the provider from buying (or payment plans for) the hardware from the manufacturer is a good thing, especially in terms of creating less lock-in and more flexibility + awareness for consumers. (It was weird when I used Apple’s program for my latest phone – I was thinking of it less as a ‘phew I don’t have to pay this big chunk up front’ and more ‘here’s a crisp upgrade plan if I want to do this on a closer to annual basis, that doesn’t cost much more overall if I stick it out’ So when I realized I was shunted through an automated 3rd party bank loan process, it felt a bit seedy- I wanted to say “I could have payed for this really!” – I didn’t have that same feeling when the phone was rolled into the general contract. Maybe like car manufacturers used to Apple should get into being its own loaning bank/finance company)

  2. In Canada, we pay some of the highest wireless rates in the world. Mainly because the industry is run by 3 companies and there’s little or no competition. It’s amazing how fast a change by one company is reflected by the others. Coverage is roughly the same. Of course it depends where you live. And two of the companies share their LTE network.

    I’m one of those who do keep track of when plans and phones were purchased. It’s often easier to pay out the phone over 2 years. And the difference is minimal. However, rate plans change almost monthly it seems, and if you change anything on your plan, you need a new plan.

    My iPhone 6S is paid up as of November this year. Of course I had a reminder. So I call my provider and ask about a reduced rate since I’ve now paid for my phone. He tells me that I’m already on a discounted plan and that any change would require a new plan. And of course they don’t have a plan that reflects exactly what I have now. As for the discounted plan, I was not aware that it was discounted and I don’t remember any savings. Usually you see a decline in price with a discount. I didn’t.

    Usually, bring your own phone plans are $20Cdn cheaper per month. After 2 years I didn’t expect it to still be $20. After all, by removing the phone from the plan, I’d need a new plan. But I did expect some rate reduction.

    Monday I will call them again. I find that things change if you get a different person. And I’ll use the “switch providers” card so maybe I can get them to send me over to customer retention or customer loyalty or whatever they call it. Unfortunately where I live my wireless provider is not my Internet and TV provider. That provider has been terrific over the years, but they don’t have wireless.

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