"Vodafone is set to feel the wrath of its pay as you go customers after it was revealed that they may pay significantly more for their calls under a new price initiative.

The operator had originally charged prepay calls by the second, but from 1 August it will charge by the minute and round up, meaning that users who talk for 61 seconds will pay 50p rather than 26p they paid originally – a 92% increase.

A concealed message on Vodafone’s official website announced the news as a benefit for customers. It said: ‘No more complicated pricing, just clear, straightforward per minute charges. That way, you’ll always know exactly how many minutes you have left.’

However, customers have taken to its PAYG services forum to register their disappointment with the changes. One comment said: ‘Please don’t patronise us.  This is being introduced to make more money for Vodafone and it doesn’t make things simpler.’

Vodafone was unavailable for comment."

http://www.mobiletoday.co.uk/News/25907/Vodafone_prepay_price_hike_leaves_customers_angry.aspx

This is yet another of the big operators pushing up the price of pay as you go calls outside of bundles. That said, Three recently launched pay as you go calls at 3 pence per minute, so it is going in the opposite direction.

There are also many virtual operators offering far lower call rates for those whose usage doesn't make a bundle worthwhile.


And of course this is another operator which is moving the goalposts so as to bill per whole minute rather than per second.

According to BBC News article: Vodafone under fire over per-minute charges change, O2 and Virgin Mobile still charge per second, but T-Mobile and Orange charge per whole minute.


Here's the announcement from Vodafone:

Pay as you go pricing just got simpler


Quote:

Pay as you go pricing just got simpler Pay by the minute – and always know how much credit you have left Calls on Pay as you go are getting simpler from 1 August 2013. No more complicated pricing by the second – just clear, straightforward per minute charges. So if your call is a minute and 37 seconds long, it’ll be charged as two minutes. That way, you’ll always know exactly how many minutes you have left. Which calls are charged by the minute? • UK landlines (starting 01,02,03) and mobiles • Channel Islands and Isle of Man mobile and landline calls • International landline and mobile calls • Voicemail

This begs the question: if charging per second was "complicated" for customers why did Vodafone do it in the first place?

It's the equivalent of fuel-filling stations saying that charging per one-hundredth of a litre is complicated for customers and that instead they will now be charged per whole litre.

If a call lasts 90 seconds at a call rate of 25 pence per minute with whole-minute billing this will cost 50 pence. So the actual cost (in this example) is 33 pence for each minute. The point being that 25 pence per minute is the least it will cost and that most calls will cost more. Only those calls whose durations are integer minutes will cost the minimum amount.

Rather than stating calls cost "25 pence per minute", the accurate description (so as to give the full picture) is that calls cost "between 25 pence per minute and 50 pence per minute".

This is just another one of those ways to increase their revenue but still make it sound like nothing has really gone up and of course it's all done for us, our benefit, rather than theirs.

I can see other mobile networks following eventually and may even spread to landlines.

bbb_uk wrote on Jul 11^th, 2013 at 4:56pm:

I can see other mobile networks following eventually and may even spread to landlines.

Customers with Orange or T-Mobile are already charged on a per-minute basis.

bbb_uk wrote on Jul 11^th, 2013 at 4:56pm:

This is just another one of those ways to increase their revenue but still make it sound like nothing has really gone up and of course it's all done for us, our benefit, rather than theirs. I can see other mobile networks following eventually and may even spread to landlines.

This isn't a new thing. The main landline providers definitely do it.

We've discussed whole-minute billing before. In Septemper 2008 I posted that Three ended per-second billing and the quoted article said that T-Mobile was the only mobile operator to have per-minute billing. I remarked this followed BT and Virgin Media making the switch, so it's being going on for at least five years.

I've just checked and Post Office Home Phone, Sky Talk and TalkTalk all round call durations up to the next whole minute for billing purposes.



Dave wrote on Jul 10^th, 2013 at 11:06am:

Rather than stating calls cost "25 pence per minute", the accurate description (so as to give the full picture) is that calls cost "between 25 pence per minute and 50 pence per minute".

Whilst the pricing text I put forward was offered a bit tongue-in-cheek it has helped me subsequently to come to the conclusion that the main issue is one of clarity, or rather lack of.

We have a situation where the cost of a call of a particular duration at a particular "per minute" rate can differ despite that headline rate being the same. The difference isn't usually a marginal one and so perhaps the charging method needs to be made clearer.

Dave wrote on Sep 12^th, 2008 at 10:43am:

...Imagine what would happen if meat was rounded up to the nearest 500g; I'm sure trading standards would have something to say.

I agree with this comment from the other thread you referred to.

However, past experience shows that Ofcom doesn't like doing anything that CPs may not like.

A switch from per-second billing to per-minute billing, without changing the rate, is a price increase. That cannot be denied.

The question is whether customers would prefer higher quoted rates and rounding to the second, or lower quoted rates and rounding to the minute, to produce the same revenue.

Except in cases where the amount of time rounded is disproportionate to the actual call duration (i.e. if durations are very short), I would personally opt for the clarity provided by the call charge being a multiple of the rate quoted.


There could be merit in Ofcom compelling consistency across the market, rather than allowing choice. That would however be unpopular.


(A mischievous suggestion is for a rule that demands rounding down to the nearest minute - so quoted rates would be even higher!)

http://www.dailymail.co.uk/money/bills/article-2383351/Vodafone-pay-costs-soar-starts-charging-minute.html



PUBLISHED: 12:01, 2 August 2013 | UPDATED: 12:46, 2 August 2013




Massive cost increase for 8m Vodafone pay-as-you-go customers as it moves from charging per second to by the minute


Millions of pay-as-you-go Vodafone customers will pay substantially more for their calls as the company moves from charging per second to charging per minute.

All new minutes will be rounded up so a call lasting one minute 10 seconds, previously costing 29p, will be treated as a two-minute call and customers will be charged 50p.

The change affects Vodafone’s 8million pay-as-you-go customers and the company said that it has notified them 30 days in advance. It added that ‘many of our competitors already offer price plans charged in this way'.

The change affects all calls to UK and international landlines and mobiles. The cost per minute for calls to national, local (01,02,03) and other Vodafone mobile numbers remains at 25p.



A spokesman from Vodafone said: ‘Many of our competitors already offer price plans charged in this way. We believe that by offering propositions with a generous allowance of minutes, we continue to offer our customers great value.’

The provider said it made the change because the ‘cost of providing services has risen’. A spokesman added: ‘No company likes to change the way they price but that is the reality of the market today.’

Pay monthly customers will continue to be charged by the second.
COSTS FOR VODAFONE PAY-AS-YOU-GO CUSTOMERS EXPLAINED

National, local (01, 02, 03) and other Vodafone mobile numbers - 25p a minute

Calls to any Channel Islands and Isle of Man mobile and landline (starting 01481, 01534 or 01624) - 36p a minute

International: Europe - 28p a minute, Asia Pacific 80p a minute, USA and Canada £1.35 a minute, rest of the world £1.65 a minute.