Which? calls for an end to confusing mobile phone charges that leave hard-pressed consumers paying more than they should, as our new research shows that people who resort to haggling are getting a much better deal.
As the Government hosts a summit with mobile phone providers, Which? is calling on ministers to get tough with an industry that has been allowed to confuse consumers for too long.
New Which? research reveals that four in ten consumers (39%) have resorted to haggling to get a better mobile phone deal. Nearly nine in ten (86%) of them were able to negotiate a better deal, saving over £100 a year or getting extras like a new phone or free minutes.
A recent Which? survey also found that a quarter of people (25%) tried to leave a landline, mobile, broadband or pay TV contract early in the last five years. Only seven in ten (70%) were successful and four in ten (42%) mobile phone customers who left had to pay a penalty charge.
We want the mobile providers and Government to introduce without further delay, and without waiting for possible new EU regulations:
- Easier switching with your SIM unlocked for free once the handset is paid off, and no penalties for leaving a contract after six months.
- Simpler mobile tariffs with handset and service charges separated, and the handset costs automatically dropped once paid off, so consumers are not overpaying.
- Caps on bills set by consumers to give them control over how much they spend and prevent bill shock.
Following the success of our Fixed Means Fixed campaign, Ofcom recently announced that consumers can exit their mobile phone contract if their provider hikes the price, without paying extortionate exit fees. However, we think consumers should be able to leave their contract after six months to put competitive pressure on providers to offer customers the best possible deal.
Which? executive director Richard Lloyd said:
“The Government must get tough with telecoms providers and help put millions of consumers, who are struggling with the cost of living, in control of their mobile bills.
“We found that mobile providers are offering much better deals to customers who are savvy enough to haggle, which begs the question why they can’t offer more transparent, competitive deals to everyone all the time. It needs to be much easier and free for people to switch and leave their contract.”
Our new research found:
- Nearly nine in ten (86%) consumers were able to negotiate a better deal and seven in ten (71%) said the process was ‘easy’.
- Those willing to haggle were able to secure an average saving of £8.81 per month, or extras like a new phone, more minutes or an increased data allowance.
- For those that haggled, Orange (93%) are the most likely to offer you a deal, followed by Vodafone (89%) and Virgin Mobile (88%).
- Across all providers, more than four in ten (42%) people were offered a permanent discount on their mobile deal.
- A third were offered more minutes (35%) and more texts (32%).
In a separate investigation, we found that selling your old mobile phone on eBay could be significantly more profitable than selling it to a phone recycling website. The highest price our researchers got offered from a recycling company for an iPhone 4 16GB was £105.37, but the same make of phone was sold on eBay for an average of £164.84.
Research from Billmonitor last year suggests that three quarters of people (74%) on pay monthly contracts are on the wrong contract wasting a collective £5.98 billion per year.
Notes to editors:
1. Which? surveyed 765 members of the public about their mobile phone haggling successes and failures between 27th September and 3rd October 2013. 298 (39%) of them said they had tried to exit their mobile deal and 255 were offered a better deal on at least one occasion. For a full copy of the articles contact firstname.lastname@example.org or 020 7770 7562.
2. Populus, on behalf of Which?, interviewed 2093 UK adults online between 11th and 13th October 2013. Data were weighted to be representative of the UK population.
3. Billmonitor National Mobile Report 2012, p17.
4. Consumers should be able to leave a contract after six months without paying a penalty. They would still have to pay off the residual value of any subsidised equipment or promotions but this would allow them leave a contract that doesn’t deliver what they expect rather than stay locked in.
5. EC proposals in the pipeline include:
- Consumers will have the right to terminate any electronic communication contract once the first six months have elapsed. Consumers would not be required to pay any compensation other than the residual value of subsidised equipment/devices or promotional offers.
- Consumers will have the right to set financial caps at the level of their choice, for free, to ensure their bills never go over this amount without their consent.
- Consumers will have the right to port any phone number from a national telephone numbering plan within the same member state, for free, with activation happening within one working day of the switch.
- Receiving calls while roaming will be free as of 1 July 2014.
6. Top tips to secure a better mobile phone deal:
- Before you make the call check your latest bill to work out how many minutes, texts and data you use and the search the market for the best deal according to your needs.
- Open the negotiations by telling the operator that you don’t think you’re getting the best deal and let them know about any better deals you have found.
- At this stage the call handler may offer you something. But if it’s not what you want, don’t be afraid to push a bit harder.
- If you’re happy with the deal, you can either sign up then and there or you can ask them to put a note on your account so that you can sign up later after you’ve shopped around a bit more