Phone shop staff misleading customers over ‘fixed’ mobile phone contracts

Guest post by Which? the consumer rights campaigner. Consumer mystery shopping carried out by Which? shows sales staff giving inaccurate information about the possibility of price increases.

 

Do you think fixed mobile contracts should be at a fixed price? Pledge your support at www.which.co.uk/fixed

New undercover research carried out by Which? revealed that the vast majority (82 %) of staff in mobile phone shops we visited gave incorrect information about potential price rises on ‘fixed’ phone contracts at the point of sale.

Astonishingly, 82% of shop assistants maintained that the price was fixed even when asked if it would stay the same throughout the length of the contract. All shop assistants, when prompted, claimed that the features will stay the same throughout the contract.

Which? recently launched the ‘Fixed Means Fixed’ campaign, which has already received almost 20,000 pledges of support from consumers, calling on phone companies to ensure that the price, and all aspects of fixed deals, remain the same for the full length of mobile phone contracts.

In the past year, four out of the five main phone operators have taken advantage of a hidden clause that allows them to increase prices on contracts that appear to be ‘fixed’, a practice potentially netting the industry up to £90m in a year.

Which? executive director, Richard Lloyd, says:

"It's totally unacceptable that people aren’t being told the full story about potential price rises when signing up to contracts in mobile phone shops. Shockingly, even when we asked directly about price increases, the vast majority of staff denied this could happen."


"There should be no nasty surprises after signing a mobile contract. People must be confident that fixed really does mean fixed."

Which? research found that 70% of people on fixed contracts did not know that mobile phone companies could increase prices during the length of their contract. Recent price rises by mobile phone operators:

• Vodafone: 11 Oct 2011 - rounded up contracts to nearest 50p; doubled out of bundle internet rates
• Orange: 8 Jan 2012 - 4.34% price rise
• T-Mobile: 9 May 2012 - 3.7% price rise
• Three: 16 July 2012 - 3.6% price rise

Mystery shopping was conducted by Which? in July 2012, in 39 phone shops in the Midlands, North West, South, North East, South East. The shops were from the five biggest network providers – O2, Orange, Three, T-Mobile and Vodafone – as well as the two biggest independent chains, Phones4U and Carphone Warehouse. Sample conversations between mystery shoppers and shop assistants:

Mystery Shopper: Will it stay that way for 2 years? 
Assistant: ‘Everything will stay exactly the same the whole two years’ (when pressed on whether the price is fixed) ‘Yes, It’s fully guaranteed’.

Mystery Shopper said they’d seen news about some of providers putting their prices up. 
Assistant: (looked confused) ‘We’d never do that!’

Assistant: ‘We legally can’t [raise the price] because you sign up for that contract for 24 months’

Assistant: the contract should give ‘total peace of mind’ because the price can ‘never change’.

The Which? Fixed Means Fixed campaign is calling on operators to advertise upfront the possibility of price rises and, if prices do increase, to allow people to switch contracts without penalty. Which? has also complained to the regulator, Ofcom.

Do you think fixed mobile contracts should be at a fixed price? Pledge your support at www.which.co.uk/fixed