Dave wrote on Jan 30
th, 2014 at 12:38am:
Contrast this with the situation before the Ofcom Guidance. Telcos were free to increase prices without any requirement for customers to exit without penalty which in-turn meant that they never had to write any increases into contracts.
If someone challenged it enough I believe they could still exit a contract because it wasn't wrote into the contract that a price rise would happen thereby implying the contract is fixed.
Quote:Thus, as SilentCallsVictim says, the Guidance has introduced clarity.
That's all they have done but that still doesn't explain Ofcom's first paragraph (as I quoted) which implies no price rises now.
Quote:In other markets, such as financial services, and gas and electricity, there are different types of contracts. For example, fixed and variable savings interest rates. Why should telecommunications be any different?
I thought likes of fixed rate saving and fixed gas/electricity is actually fixed as I've never known them to then change rates mid way through a contract, unless it's variable rate which then isn't generally a contract so can switch anytime and they have names like "variable rate" to make it clearer.
Now compare this to teleco's that never openly admitted contracts would rise mid way (with some not evening mentioning they would rise in t&c) but yet they still wanted to raise it anyhow.
It's unfair to omit something (like prices will increase) when selling a mobile contract for example but still increase it anyhow.
I personally don't think sales persons are going to draw attention to the fact that prices will rise mid contract before the contract is signed by us customers.
There is also the issue that customers that are aware prices will rise still wont know by how much by so that creates uncertainty which Ofcom claimed they were trying to avoid!!
Yes, I agree inflation has to be taken into account but be upfront and honest and not just increase it without warning consumers in advance of them signing a contract.
Gas and electricity fixed prices are generally higher the longer the contract so they take into account inflation, etc.
Basically what would be fair is that sales persons inform potential customers that prices aren't fixed and may rise by an unknown amount (which it technically is) BEFORE a contract is signed thereby stopping the misleading practice of consumers thinking the price quoted is for the life of the contract.