Three and Vodafone back Ofcom ruling on mid-term price rises

Three and Vodafone back Ofcom ruling on mid-term price rises

Three and Vodafone will not be following O2’s move to add mid-term price rises to new and upgrading customers’ contracts.

Both operators clarified their policies to customers this week following O2’s decision to add a clause in customers' contracts allowing them to increase new and upgrading customers' monthly phone bills in line with RPI from 23 January.

O2’s decision to maintain mid-term price rises is seen as controversial within the industry because it closely follows Ofcom guidance aimed at preventing such rises in mobile phone contract price rises .

O2 insists their price hikes do not contravene Ofcom’s guidance since customers are clearly informed of the price rises before signing up for the contract.

Three said today it will protect its customers from price rises for the length of the contract, in support of Ofcom’s new guidance.

The operator said: ‘Your fixed monthly recurring fee from Three will not go up in the minimum term of your contract.

‘We support Ofcom’s approach to fixing the price for pay monthly contracts for their duration. We think it’s only fair that customers should have clarity around costs when they sign up to a contract.’

Vodafone also said it would follow Ofcom’s guidance. In a statement the operator said: ‘We will respect Ofcom’s guidance on mid-contract price rises. We will continue to notify customers of increases to out-of-bundle call prices a month in advance, with significant variations also potentially allowing a customer to leave their agreement.’

EE has yet to confirm its policy on mid term hikes to contracts.

Analysts said O2's strategy could be driven by Telefonica's current financial problems.

Phil Kendall, global wireless director at Strategy Analytics said: 'It has to be a contributory factor. The challenging group situation puts pressure on subsidiaries to eek as much profit out of their markets.'


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