ASA agrees that O2 ad is misleading – what does this mean?

Contracts, of any kind, can be a minefield and this was especially so for mobile phones. So we launched our Fixed Means Fixed campaign to address this. Well we’ve had a long awaited win today for this campaign. So how could this help you?

Things were so different in 2013. Selfies were everywhere, Chelsea were a decent football team and mobile phone providers were hiking mobile phone bills mid-contract without telling us before we took out a contract. How things have changed, well, apart from selfies.

Back in 2013 we had a win for our Fixed Means Fixed campaign. With your help we saw a change to the rules on mobile phone contracts after thousands of you helped us put pressure on the regulator and industry.

Together we convinced Ofcom to issue new rules so providers couldn’t hike prices mid-contract whenever they felt like it. But it wasn’t all as rosy as we’d hoped for.

Mobile malpractice

You might remember that to our great disappointment, O2 decided to go against the spirit of the new Ofcom rules by writing into customers’ contracts that they definitely would increase prices annually. Nearly 8,000 of you joined us asking O2 not to go ahead but they continued on that course, followed closely by EE.

We then complained to the Advertising Standards Authority (ASA) about an O2 advert which claimed customers could get a £14 a month fixed mobile contract, despite the price only applying for one month of a two-year contract. The small print however, stated that prices would rise by the rate of inflation so a customer would only get one month at £14 before their bill went up.

We thought this was outrageous, you shouldn’t have to scrutinise the small print to figure out whether the advertised price of a mobile contract is in fact the price you’ll pay.

ASA win

Now, almost two years later the ASA has published their final decision.

The ASA has said that the O2 advert was likely to mislead because:

‘The monthly price of a contract was likely to be of significance to consumers when deciding on a mobile phone contract, the monthly increase within the term amounts to a significant term, which should be made clear to a consumer.’

And has concluded that:

‘The ad failed to make clear the RPI (Retail Price Index) price rise to airtime plans and was misleading.’

This important decision means that telecoms companies should be much clearer upfront about any intended price rises during the term of a contract and can’t hide mid-contract price hikes in the small print.

Featured Comment

sootysmum says:

3 February 2016

I am glad that ASA agreed that the ad was unfair. My sons take out contracts and do read the wording but still found themselves locked into long term expensive contracts. Part of the issue is the lack of competition and I would like to see more companies following suit charging less. Another issue is obtaining expensive phones through a contract. I have a pay as you go for emergencies and use my landline for the majority of my calls. When I say thing I am looked at with complete disbelief but it works and I have control over my costs. Perhaps this is the way that mobiles should go then the costs really would be easier to compare.

See full comment

We are of course continuing to campaign for fairer mobile deals. But we’d like to know your thoughts on this ASA ruling. Is this welcomed news for you? Or do you think it’s just a small step towards fairer practice?

dieseltaylor says:

I am impressed by the speed that the ASA made their decision. And so encouraging that such a difficult point was discerned as being misleading.

malcolm r says:

Do I detect a note of sarcasm DT? I hope so. It only (only?) took 2 years (by which time the “fixed contract” has finished)? And “fixed” and “rise” created a difficult point to discern?

I do not know, unless I have missed something crucial, why such a matter could take so long to decide. On the basis of the intro common sense should give the answer in about 2 minutes.

Do all those affected subscribers get a rebate?

wavechange says:

Well done Which?

This is an important victory because if we had put up with mobile service providers increasing monthly payments during contracts we might see monthly payments start to rise during the duration of contracts for other goods and services. The important parts of the small print need to be in large print!

Mrs T Bradford says:

Well done ASA a long overdue victory for all mobile users!

Bernie says:

As I see it O2 are still gong to increase prices every April, the only difference is they will have to say so in their advertising. Hope I have misinterpreted the announcement because what we need is for O2 to really fix the 24 months contract cost. At the moment with RPI relatively low it’s just a few pence increase but compounded each year.

Captain Quandary says:

I thought the ASA were a body that is paid for by the tv companies. It is the ASA who think they’re better at assessing whether something is decent honest and truthful even when thousands complain . In other words, they’re biased and irrelevant. I would have thought a higher (government) body should have been approached to achieve a more watertight and timely ruling on this.

Stephen Biggs says:

They are so long and full of lawyer speak you just give up. They need to be in plain language.

Bernarda Frayne says:

Time , bodies like ASA & Ofcom shortened their time in making decisions which affect the general public’s interest.. Afterall, this is outright theft from the general public by private companies. It’s as if the ASA & Ofcom are almost saying that it is okay and we will make out to be seen as though we are doing something about the situation. Who are these people sitting on these boards & being paid astronomical salaries to be non-biased and make honest opinions & decisions. Sorry my mistake I should say dishonest, lying and cheating talking in gobbledy good to the hard working British public Bernarda Frayne

John H says:

4 February 2016

I think that we need still more regulation to make mobile phone companies unable to charge anything above their advertised headline price. And if they do so even if it a few pence this should give victims – customers the right to cancel and keep the handset along with the right to get a free unlocking so that they can go to any other network offering a better deal.

Frank Pycroft says:

Brilliant win!! Well done Which?

BUT there is another area where mobile phone companies trick people all the time. If you live in a dead-signal spot, they don’t tell you this when you sign the contract. With me, I was told that their computer said my signal was normal at my home address. BUT it never was for a single day! I complained for all of the two years of the contract. I consulted Which? Legal team, who said the contract permitted no-signal conditions. I was advised to go to the Ombudsman, who agreed with this. I have since been told that the Ombudsman had agreed the contract was OK in the first place.
What a mess.
Solution: Which? Should start a campaign to have the following clause put into every mobile-phone contract:
‘Any contract is null and void if the user of the phone cannot get a home signal at any time during a three-day period. All fees are to be refunded. If the company says there is a home signal, they must send out a team to check the signal themselves when the user is at home. If they still refuse to refund fees, the Ombudsman must send out a representative to check the signal situation.
After all, if you sign a contract for water, gas or electricity, non-supply would mean no bills. It should be the same for no mobile signals. It’s as simple as that!!

Frank Pycroft
04.02.2016

Frank – This must be very frustrating and it is high time the mobile service providers shared network access, as they do for emergency calls. That would offer the maximum chance of having a usable signal and would be beneficial to everyone, especially those of us who visit rural areas.

I feel strongly that the cost of the phone and the service should be separated. If we pay for our phone service on a monthly basis we could simply switch to another supplier if there is a problem with the signal. Obviously it would be necessary need to buy a handset (either outright or by monthly payments) that is not locked to a particular network.

kevin says:

6 February 2016

I agree. Exactly the same thing happened to my wife she took out a two year contract with EE and couldn’t get a signal at home or where she works in London. We had to pay the contract even though EE did not supply the service. When we changed to another provider coverage was fine.

A says:

Is there any chance of those of us affected by this price hike getting a refund?

At the time when phone companies were putting up their monthly payments mid-contract, I asked for written confirmation that the price would not rise during the following year, the duration of the contract. Some months later the service provider said publicly that it would not be raising prices mid-contract.

J. Laird says:

The ASA have as usual taken an extraordinary long time in making what to most of us was an obvious and logical decision. While I welcome their decision I would like to see recompence for customers to give amessage out to other mobile companies

Maurice Jones says:

25 February 2016

Another increase of 19p each month from March. Multiply this be “X” customers amounts to many many pounds. I was told it is legal as its in the contact small print. How do these people sleep at night?

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