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O2’s price rise ‘flies in the face of new rules’

We’ve been celebrating Ofcom’s new rules to protect consumers from mid-contract price rises. But O2 has found an opportunity to sting new customers with another price rise and we’re calling for action.

I will remember Thursday 23 January for two things; a big win for consumers as Ofcom’s rules kicked in, and a big groan as O2 unveiled a price rise.

You see, we came full circle with our Fixed Means Fixed campaign, which had the backing of 60,000 of you. Ofcom’s new rules now mean you can leave your phone or broadband provider penalty-free if it unexpectedly hikes prices mid-contract.

O2 announces a price rise

However, O2 announced a mid-contract price hike of 2.7% for its eight million pay-monthly customers, due to come into effect in March 2014. Unfortunately, the new rules permit price rises for existing customers and new customers as long as these new customers are told about this at the point of sale. Now O2’s using this loophole to hike prices for new customers who signed after 23 January 2014, as O2 says it will warn them that inflation-matching price rises will hit them on a yearly basis.

Plus, since these hikes will be measured by the rate of RPI (retail prices index) you won’t even know how much you’ll end up paying. And those who join O2 after Ofcom’s rules take effect still won’t be able to leave their contracts without penalty.

We don’t think that’s right or that O2 is following the spirit of Ofcom’s original announcement. We stand by the message of our Fixed Means Fixed campaign, and we’ve been in contact with O2 to tell them this. You can also help us up the ante by emailing O2’s chief exec to tell him to rethink O2’s approach.

Three won’t hike prices mid-contract

Thankfully Three Mobile has embraced Ofcom’s new rules:

‘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.’

We’ll be keeping a close eye on other providers to make sure they follow Ofcom’s rules, rather than following in the footsteps of O2.

[UPDATE 28/01/2014] Vodafone has confirmed that they will respect Ofcom’s new rules. You can see this in section 11 of Vodafone’s new contract T&Cs:

‘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.’

Are you an O2 customer? What do you think of O2’s latest price rise?

Comments

I am an O2 customer and have just received a text today that , as of March 2014 , my tariff will be increased by 2.7% which they claim is the RPI . This may be fair for NEW contract for a given year but NOT when a price has already been agreed
Time these devious creeps were stamped on
As soon as I can opt out I will leave O2 forever

Once again we are being ripped off. It’s only 45p per month to me but typical of o2. I will seriously think about leaving o2.

Simon Hughes says:
24 January 2014

Just got the news of the O2 price hike now. Ive been loyal for many years but it seems this doesn’t matter to O2 so I think it’s time for a new network

While I am not with 02 this has shocked me. How can a company do this? I mean, don’t they care about how they look to people like us?

We live in Rip Off Britain, we’re just cash cows to these companies, nothing more. 🙁

Not much of victory then. 🙁 And don’t forget ofcom have only issued guidance, and we all know that guidance counts for nought. The dept of Health issued guidance in 2006 for doctors to stop using premium rate numbers and still many do.

I for one am not surprised by this. I did try and warn of it last year.

Makes you wonder just how much leverage the phone companies have over ofcom. Maybe regulators should use Which? legal service to check over their documents before they publish them.

That is interesting, but I assume that it will not happen. If Ofcom did this I would have a great deal of respect for them.

Well for one they’d actually need to write the guidance correctly without any loopholes in it. I wonder how many people at ofcom and outside actually red what they were going to publish before they did and if anyone actually spotted or mentioned how poorly written it was.

I’m no lawyer and on my 1st read through it looked iffy.

“Although guidance, if it’s breached Ofcom can punish providers with a fine of up to 10% of their turnover. ”

Yeah. And you think that OFCOM will? OFCOM are the worst, most ineffectual regulator in the land. Not only is the guidance poorly drafted and weak in protecting consumer rights, it’s taken the lard-bottoms of OFCOM almost a year to implement. I’ll wager that no telco gets fined under these powers.

Carole says:
24 January 2014

2nd rise for me in 18 months, how and why should they get away with it!

Dave Hill says:
24 January 2014

Pleased to say my contract with O2 expires in April when I will move. It’s not the amount I can easily afford it, it is the principle. How O2 think they can treat their customers like this beggars belief.

15 years with what is now O2, last December they changed it such that your bundle so called ‘free” minutes could notbe used to call Channels Isles, Isle of Man etc… Which means I now have to pay to call my family. Asked to downgrade my contract to half the ‘free’ minutes and then use that £5 to block buy 30 mins to the said places…….”no, cannot change mid contract” Couldn’t leave, but now this hike, thanks to Which, I can now cancel, and get a better deal.
Customer loyalty, it’s a myth. As a lot of people don’t actually have a landline, mobile companies just cashing in where they can!!

Chris Collins says:
24 January 2014

I’ve been a loyal supporter of O2 for 14 years. Received the final e-mail I’ll ever need to receive from them today about the mandatory greedy price hike. Not tied in to any contract, so this has made me decide that enough is enough. Goodbye O2…hello Three! Better deals, upgrade you to 4G for free and lower upfront costs for the phones. When I rang O2 for my MAC code, they even admitted they don’t price match Three deals and didn’t try to keep me. They’ won’t be so smug if everyone decides to leave O2 out of protest!

Just had a thought, all too often regulators and its not just ofcom, they all do it. They’ll all blame the guidance set out by government that they have to follow, and yet not once have I heard we’ll be lobbying government to improve our powers. That’s jobs worths for you.

Maybe Which should offer to step in between government and the regulators. Take the spirit of what government wants and give the regulators the power to do what we the end user need.

Cos at the moment regulators don’t seem to be up to the job.

A resounding YES . . . William is exactly right, almost every field in which there has been a scandal or repetitive scandals over recent years is one where the Regulator or Ombudsman/ men/ women, paid for by us through taxes or levies on the price of service, has been complacent / incompetent / asleep on the job.

Energy, telecommunications, legal services, the Police, local government, the ‘Care and health industries’, the list goes on. The only ones who seem brave and competent from my personal experience in the last couple of decades are the Information Commissioner and the Office of Fair Trading.

It is time we either campaigned to ‘ginger up’ there jobsworths or, alternatively, rid ourselves of the cost and drag effect of their sloth and ineffectiveness by sweeping them away and putting Which there instead . . . Which?, CAG and charities seem to get more result, faster than a lifetime of these placemen!

I had a price hike last year, 15 months into my ‘fixed’ contract. I have been with O2 for over 16 years but will be leaving now as my contract is up for renewal.
Seems they think that they do what they like to their customers and the only way to change their attitude is our footfall! Lets all change suppliers – they can’t survive without us.

Kathryn Barrow says:
25 January 2014

Just taken a new contract before Xmas. They offered me 4G for the price of 3G. However just received an email saying the price is going up. Wish I had never bothered feeling duped

All comes about because foreign countries effectively run so many of our utilities of all sorts. Am sick and tired of Banks, Utilities, Transport Services . Communication Companies etc., altering contracts and agreements to suit themselves and yet we can do nothing. These are not contracts in any sense of the word, not even true agreements. O2 jumping on the bandwagon is no surprise at all but I shall never be using them again.

The reply from O2 said “Sorry – as you’ve not contacted us through our website, we’ll not be
able to reply to your email.”, which sounds to me like a polite way of saying they are ignoring my message.

I asked a Live Chat advisor how to contact the CEO, and was told to use complaintreviewservice@o2.com so I sent a copy to that address as well. I wonder whether Which should be directing our comments there?

Sarah says:
25 January 2014

I received a text 2 days ago about the rise and am not happy at all as I have been with 02 for years without complaint. As a pensioner I got an affordable montly rate as I only wanted a flip
top mobile phone not a touch screen or the like. I need it for emergency but now I feel that as
I was not informed from the start about any possible price increasest I have been conned and
I am upset because I have only just sadly signed up again for another 24 month contract !

So you’re getting people to bombarded the charirman of O2 with emails, will you also be bombarding ofcom suggesting they re-issue their guidance without easily exploitable loopholes.

Sigh says:
25 January 2014

Good point. Perhaps next time you also check the guidance for loopholes so it does’t have some and then you can say you have really done your job and made the change.

Paul says:
25 January 2014

Had the email from 02 about the inflation rate increases. When speaking to 02, they give the same stock response with the same links to the prices page and the terms and conditions clause. I signed a contract in June 2013 and the clause regarding inflation rate price increase was never mentioned to me explicitly.I am disgusted that O2 are not allowing termination mid contract despite the OFCOM guidance

I have informed 02 that i will not be looking to renew my contract next year,

I believe that this is a major PR mistake by O2 which will backfire. As much as i hate price increases in the engery sector, at least you are able to switch tariffs upon receiving a price rise announce and be refunded if they increase your prices if you have told them you will switch

I wouldn’t be surprised if their corporate accounts make them more money than all the little individual accounts combined. So I doubt they care what we think.

piperdog123 says:
26 January 2014

Another example of a toothless regulator.

On the day Ofcom celebrates o2 stick two fingers up at them and say get stuffed. Ofcom got it wrong. Didn’t do their homework. Left loopholes. O2 went in and said thank you very much.

Most o2 customers will be annoyed but will do nowt about it. A few will leave.

But o2 doesn’t care. It doesn’t care about customers. It lies on its website about how good coverage is. It’s pricing is shown for what it is. Three, who are eyeing up a takeover of o2 if the reports are true, must be delighted. Why buy the business when you can pinch their customers much more cheaply.

Rip Off Britain continues. Sack the regulator.

Why would they want to sack the Regulator? He / She / It is doing a great job for them, long consultations that give them months to plan their evasion tactics, loosely worded ‘guidance’ and regulations, reluctance to act and even greater reluctance to use sanctions that would meaningfully deter . . .

I would imagine that they are lobbying their mates hard to have more of the same!

It’s quite clear that the role of Ofcom as Ofcom sees it is like that of a referee on the field, referees are part of the game and only have a distant relationship with the spectators (consumers). The EU is doing a tougher job of telecoms regulation than our ‘wet lettuce’ placemen and that’s saying something when most of the EU still has rudimentary levels of competition many with government owned or favoured quasi-monopolists still in control – and buying up UK telcos when they get the opportunity and importing their culture of impunity.

Margaret says:
26 January 2014

Sent my email off to the CEO of O2 and received following reply

“Sorry – as you’ve not contacted us through our website, we’ll not be able to reply to your email. Just to let you know we’re due to shut down out email help service within the next few weeks”.

Any contract should be adhered to by both parties and a fixed amount for the period they insist a contract is for should stay as a fixed amount for that contract period or they should reintroduce annual contracts.

Wonder if they’ve forgotten about … Electronic Commerce (EC Directive) Regulations 2002

which amoungst other things states:

“The following checklist of information that must be included on your website includes items that are required by other legislation as well as those that will aid compliance with the above Regulations:

full company details – name, a UK geographic address and an email address
…”

piperdog123 says:
26 January 2014

These details are on the website on the contact us link.

Inaccurate comments do not help the cause.

I’ve just looked at their contact us page and there’s nothing obvious on there.

In fact I did a view source on the page and there’s no 02 dot com listed. So it must be well and truly hidden which would certainly not be following the spirit of the regulations.

And don’t forget O2 saying “as you’ve not contacted us through our website we’ll not be able to reply to your email” must surely be a breach of the Electronic Commerce (EC Directive) Regulations 2002
as why force companies to display one ? It’s certainly not so you’re forced to use some web based form.

. . . So whos job is it to effectively police those regulations . . . ?

the berr guide (http://www.berr.gov.uk/files/file14640.pdf) says:

Who enforces the Regulations?

The definition of enforcement authorities in the Regulations includes any body able to
impose a sanction for failure to observe or comply with any provision of UK law.
Examples include Trading Standards Departments, the Office of Fair Trading and the
Independent Committee for the Supervision of Standards of Telephone Information
Services (ICSTIS).

So, not a lot of clarity there, each will say ‘someone else mate’, and who is going to waste half a lifetime prodding them?

piperdog123 Can you give us the email address you have said is on the Contact Us page? Like William, I cannot see one.

piperdog123 says:
30 January 2014

To answer your took just 4 seconds. You asked for their address. I went to http://www.o2.co.uk at the bottom of the page I clicked on contact us and on the next page half way down is o2’s correspondence address.

http://www.o2.co.uk/mobile/contactus

Suggests to me just looking to moan instead of actually looking and doing something about it.

piperdog123 says:
30 January 2014

Again inaccurate comments do not help.

I went to http://www.o2.com and up came the corporate website for Telefonica Europe. On the right hand side you select your country and then that takes you to the ensure for the country you have chosen.

Suggest you edit your posts as the information is there, where it should be in common with most company websites and is easily located.

I asked with their email address not postal address. And try using a web browser and not a mobile device, you end up at a completely different page which doesn’t have the details you can see nicely laid out (apart from the email address) on the page for mobile devices

Its here http://www.o2.co.uk/contactus btw

And before you come back with another invalid assumption. If emailed Ofcom about their missing email address on their own website asking if they think they are in breach of the Ecommerce Regulations (EC Directive) 2002 and depending on a) if I actually get a response and b) what it is. I’ll then go on to accuse O2 of actually breaking a law, where as their hiking of prices sadly does not.

piperdog123@gmail.com says:
30 January 2014

Again this is clear.

Almost no company will provide information on a customers account via an email. This is due to Data Protection principles. Would you really want your personal information given out on the back of an email that could come from anyone?

O2 like MANY other companies use a WEB FORM where you provide some data that confirms you are the account holder. I personally am grateful that o2 (and other suppliers to me) protect my information so well.

I would have thought this is pretty obvious. If it isn’t then expect someone to steal your identity one day and then deal with the hassle that follows.

O2 use Web Forms for a reason. To PROTECT YOU. The Customer.

Time to follow the correct procedures. Put up or shut up I believe is the phrase.

piperdog123 says:
30 January 2014

And this shows your nievity. OFCOM do not deal with the public. They will receive your information and log it. They will wait to see how many complaints of a similar ilk they receive and if they reach a certain quota then they may choose to look into the overall issue.

OFCOM will not look into your complain in isolation nor will they respond with anything other than an acknowledgement of receipt.

If you want your complaint to be looked at you have to send your complaint to o2 first at complaintreviewservice@o2.com

Once you have done that o2 will investigate your complaint and will then give you their final response. Once you have the FINAL RESPONSE then if you remain unhappy you can refer your complaint to the ombudsman service. O2 will provide you with details of how to refer your complaint with their final response.

So again sorry but posting factually incorrect information doesn’t help anyone and makes the poster look silly.

Follow the correct process. Good luck and I hope you get your desired outcome.

The Ecommerce Regulations require companies to display an email address, if they required companies to use a web based form I’d agree with you, but they don’t, so I can’t, no matter how logical your last statement maybe.

As I quoted above: “full company details – name, a UK geographic address and an email address”

You and O2 can’t pick and choose which laws you follow and which ones you don’t simply on the basis of some make sense and other don’t.

piperdog123@gmail.com says:
30 January 2014

I think you will find in law that a Web Form is considered as email and therefore o2 will be complying with the regulations you refer to.

I would also add what does this have to do with a price increase? There are lots of ways to contact o2 but you are just looking for anything to fight over instead of following the correct procedure.

I have provided you with the email address you need for the department you need. If you don’t want to go down that route then your complaint is over.

For the record I too TOTALLY DISAGREE with mid term price increases and I also AGREE that o2 have failed to honour the spirit of the regulations even if they are within the requirements of contract law (something I have studied – have you?). O2 are within the law. Accept it. You have a choice when your contract ends.

This is my final post on the subject. You have the correct access route for your complaint. Follow it. Don’t follow it. It is up to you. The correct route is available for you. I wish you well.

I had a reply from Ofcom, the content of which wasn’t that much of a surprise …

“In relation to the Ecommerce Regulations (EC Directive) 2002 you mention, I should explain that these are relevant for online businesses and Ofcom operates as a statutory authority.”

piperdog123 says:
3 February 2014

@William

Your comments about the reply from OFCOM are EXACTLY why I have stated that inaccurate comments and posts do not help.

I have posted on here already the correct procedure to complain. There is absolutely no point going to OFCOM and expecting them to investigate your complaint because they won’t. They WILL log it and if they get enough similar complaints then they MAY look at the industry so for that it may be worth writing. I did privately question your logic regarding the legislation you referred to but not having studied it I chose not to comment in any depth.

Now that you have your answer if you want to complain then please follow my post via Jim on the correct procedure. THE POST GIVES FULL INSTRUCTIONS ON THE COMPLAINTS PROCEDURE THROUGH TO THE OMBUDSMAN. Please not though that you cannot go direct to the Ombudsman. You must follow o2’s complaints process first otherwise the Ombudsman will automatically reject the complaint.

For the record I COMPLETELY AGREE that what o2 have done is IMMORAL. I checked my contract and the potential for price increase sadly is shown. So I am stuck with it under the rules as they stand. I don’t like it. Neither does anyone else. But I and we are stuck with it. The best option for those unhappy with it is to change networks when you can I guess but watch their contracts and also of course check their signal using prepay sims NOT their online coverage checkers.

Please please accept the advice even if you don’t like it. It is the correct procedure and if nothing else it will cost o2 £300 and if enough do it maybe they will think better of it, maybe not this time but in future.

I wish you all luck. I am on your side even if you don’t think via my posts that I am.

John O says:
26 January 2014

my current bill will increase by 87p per month – not a lot but about £20 over the course of a 24month contract. I went into Carphone Warehouse today (where I took out my contract) and spoke to staff there who are very helpful, but didn’t really know anything about the increase. They put me on the line to O2 customer services who were dismissive and read of a script – putting the increase down to “government legislation” and Ofcom – as though Ofcom had introduced the increase! I am really furious about this increase being introduced to an agreed contract (regardless of frankly ridiculous “prices may change” clauses which the Ofcom ruling is designed to end) I wonder what more can be done?