Price increases to 'fixed' contracts: a year onVodafone makes up to £10.5m from price rise
22 September 2012
Mobile phone operators could have already made up to £53m after increasing prices on supposedly 'fixed' contracts, as Utility Warehouse backs Which?'s Fixed Means Fixed campaign.
Which? estimates Vodafone - the first provider to announce a price increase a year ago - has made up to £10.5m from the rise. On 23 September 2011 Vodafone announced it would be rounding up the price of its 'fixed' contracts to the nearest 50p, potentially affecting nearly 3.7 million Vodafone customers who may have been tied into contracts.
Since then another three major phone operators - Orange, T-Mobile and Three Mobile - have increased prices on 'fixed' contracts. Which? estimates that this practice has already netted the four companies up to £53m and sets the industry on course to make a combined £90m over a 12 month period.
Utility Warehouse backs our campaign
Which? launched the 'Fixed Means Fixed' campaign in July 2012. We want the price and all other aspects of fixed deals to remain the same for the contract period when consumers are also tied in. If there is a chance that prices may rise, operators must be more up front about this in their advertising and allow people to switch providers without penalty. Which? has submitted an official complaint to Ofcom about the practice.
Mobile phone company Utility Warehouse has become the first mobile provider to publicly back the 'Fixed Means Fixed' campaign.
Utility Warehouse executive chairman, Charles Wigoder, says:
'We have never increased prices for customers on fixed contracts and have amended our terms and conditions to clarify that this will not happen in the future.'
The mobile price rises in numbers
Other operators have so far rejected calls for change. Which? estimates that recent price increases on 'fixed' contracts could so far have made phone operators the following:
- Vodafone - up to £10.5m from rounding bills to the nearest 50p (introduced 11 October 2011)
- Orange - up to £32.5m from a 4.34% price increase (introduced 8 January 2012)
- T Mobile - up to £7.5m from a 3.7% price increase (introduced 9 May 2012)
- Three Mobile - up to £2.5m from a 3.6% price increase (introduced 16 July 2012)
Which? executive director, Richard Lloyd, says:
'Customers tied into 'fixed' phone contracts are being forced to cough up while the companies make millions.
'There should be no nasty surprises after signing a mobile contract. People must be confident that fixed really does mean fixed.'