/ Technology

Mobile phone prices up again – is Three your unlucky number?

Three Mobile has increased its prices by 3.6% for existing customer’s monthly plans following Orange and T-Mobile before it. For fear of bastardising Lionel Richie’s lyrics… ‘Three times a price rise’.

Anyone who signed up to Three before 8 March 2012 will be hit by the price hike from 16 July.

Mobile and mobile broadband customers will have to swallow a 3.6% price rise. On a £25 monthly plan that will be around 90p extra a month, or another £11 per year.

Only contract prices will change, with calls and data remaining at their current levels. Pay-as-you-go customers will also be unaffected. If you’re going to be affected, Three will contact you by text, email or letter between 21 May and 1 June to let you know. Three said of the price rise:

‘We know that increases are never welcome, so it’s not a decision we’ve taken lightly and we’re confident that your plan still represents excellent value for money.’

It’s all in the terms and conditions

It’s a case of deja-vu – Orange and T-Mobile have previously increased their own contract prices. Each time this has happened, their customers have come to Which? Convo to vent.

It’s understandable really – if you signed up to a contract, whether 12 or 18 months, your expectation would be that the £25 or so monthly price would stay static. Not so, mobile companies have a clause in their T&Cs that allows them to increase contract prices on a yearly basis as long as they’re under the rate of inflation (retail prices index).

And when we’ve questioned the regulator Ofcom on this, it has told us that the price rises are ‘not likely to be a breach of current legislation’.

But when we actually ask mobile customers whether they know prices can go up, 94% of 1,036 people voted in our poll that they didn’t realise their contracts weren’t at a fixed price.

It might be legal, but it’s not a line of fine print that many people are aware of. And when customers are told that they can’t cancel their contracts early without charge, the red mist starts to descend.

Make price rise terms clearer

The key is making the fact that prices can rise by inflation clearer to new customers, instead of hiding this clause in reams of terms and conditions. Our principal advocate Mark McLaren said:

‘On the one hand, it seems consumers’ expectation is that a mobile phone contract is a fixed price for a fixed term. On the other hand, mobile companies are able to increase prices by RPI during the term of the contract. This is a contradiction that can only be solved by either regulatory intervention or, at a minimum, better information to consumers at the point of sale.

‘That’s why we welcome the fact that Ofcom’s priorities for 2013 include “promoting effective choice for consumers by ensuring clear information on service, price and quality is available”.’

Are you a Three customer who will be hit by this price rise? How do you feel about it? Did you know that mobile contracts aren’t strictly at a fixed price?

[UPDATE 25/05/2012] – As you know, we’ve been talking to Three. Which? doesn’t think it’s fair to increase prices in this way without giving consumers the ability to cancel as a result of the price increase. We think that when you sign up to a fixed rate deal, that’s what you expect it to be. Fixed, for the period you agreed to.

We think that Three should recognise this and do the right thing by allowing those customers who can’t stomach this increase to cancel their deal without penalty.

A spokesperson for Three responded to us as follows:

‘Despite costs increasing in a number of areas within our business, we have not passed on an RPI level rise to our contract handset customers in the nine years we have been in operation. Increasing our prices for existing customers is a decision we have not taken lightly. We know that increases are never welcome and we have tried to do this in the fairest way possible for all of our customers. We are confident our plans continue to offer the best possible value for money.’

Comments
Guest
MrXavia says:
19 October 2012

What I find funny is that when I took out a monthly plan with three through a CPW store, they pointed out that the rate could change, BUT when I took out a 2 year contract on the phone with three shortly after they neglected to tell me that important detail on the phone… BUT I don’t care! why? because I got a good deal and while I know the Customer Service is rubbish, their network is the ONLY network with good internet speeds I have used, even if their coverage is a bit p**s poor out in the sticks…

So for me, I got a good phone, on a good deal, when I wanted it, and i get unlimited internet, something no other provider gives!
I can teather my laptop and download a 3gb film in a couple of hours, try that with Vodafone/O2/EE!

So yes Three are wrong doing it, but they are not THAT bad a network to deal with!

Guest

That’s pretty much where I stand with 3 – I was determined to leave them when my contract was up, but their deals are unbeatable so I ended up staying. Hopefully I won’t regret it.

Guest
andrea de toni says:
21 October 2012

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Guest
derek c says:
21 October 2012

i recently terminated my contract with three mobile. it expired on the 23 sept, so i gave them the 30 day notice on the 31st august. i pay in advance and never exceed my contacted minutes. so after i gave notice they took payment out of my account on the 20 augest. i sent them email saying this was the last payment and cancelled my direct order shortly after. now i got a letter saying they want another months rental, this does not make sense, has anyone had this problem when termonating a contract.

Guest

What was the actual period (start date and end date) for line rental on the invoice for which they took payment on 20 August? By giving 30 days notice on 31st August, you are liable to line rental up to the 30th September (the fact that your contract ends on 23rd September is irrelevant). Have you already been billed for the full period up to 30 September? And did you mean 20th September rather than 20th August?

Guest
pete cuffe says:
11 May 2013

yes , there taking me to court for £10.86 for the 25th month of my contract , after i cancelled twice by phone and once by e-mail, its very hard to cancel with them, bunch of thieves, and have now put my daughters contract up aswell, i thought it was fixed rate.

Guest
David heath says:
21 October 2012

It sounds a lot like incompentant staff. Stand your ground, and complain to management. Why should you pay it?!

I have had very serious problems due to their failure to cancel 2 contracts. I would always record any conversations with 3, they will say one thing and do whatever is easiest in my experience.

Guest

Hi all, thought you might like to see our latest Conversation – we’ve worked out that mobile companies are on course to take an extra £104m from customers over a 12 month period due to these price rises.

It was also the 1 year anniversary of Orange announcing its price rise on fixed contracts – it passed £41m on to its customers, and we’ve worked out what that would look like – 78,000 iPhone 5’s, 137,000 years of a mobile phone contract… check out our infographic and join the latest debate here: https://conversation.which.co.uk/technology/orange-mobile-phone-price-rise-41m-fixed-means-fixed-campaign/