Uswitch.com calls for greater clarity around broadband contract end dates
Eight in ten broadband customers want information about when their contract ends to be communicated more clearly. With many in the dark, Uswitch.com is calling on Ofcom to help empower consumers by making providers send reminder letters and emails before contracts end and automatically display this vital information on customers’ online accounts:
80% of broadband customers want information about when their contract ends to be communicated more clearly
Almost half (46%) of those who are in a contract don’t know when it ends
Three in ten (31%) of those who weren’t happy with their provider, but didn’t switch when their contract ended, say it was because they didn’t know when they were free to leave
Almost a quarter (24%) of those who didn’t leave when their contract ended saw their bills go up
If contract end date information was displayed on their online account, 41% of consumers say they would feel more in control of their data and deals, while almost 6 in 10 (58%) would be more likely to shop around for a better deal if they got a reminder letter.
Broadband customers are crying out for better access to their own data, with 80% saying that they want information about when their contract ends to be communicated more clearly. Pointing to the energy market, where consumers receive a reminder letter a month before their fixed deal contracts end, Uswitch.com highlights that the telecoms market is off the pace when it comes to transparency and clarity over this information – and this could be a barrier to effective competition.
The independent price comparison and switching service is urging Ofcom to act on its own goal to promote effective choice for consumers by ensuring that clear and relevant information is readily available, by forcing all broadband providers to better inform customers about when their contracts end.
Of those demanding clearer information, a third (32%) favour a letter reminding them when their contract ends a month before it does. Three in ten (30%) prefer a reminder email and 14% would like the information displayed on their online account.
As a result, Uswitch.com is calling for providers to adopt all three methods to effectively communicate contract end date information to customers. The reminder letter, a month before their contract ends, should tell them that they are free to change deal and what their monthly bills will be going forward if they have been on an introductory offer. This information should also be emailed. The contract end date should also be clearly visible when customers log in to their online accounts. Consumers are being urged to support this by signing uSwitch.com’s ‘I want to be told when my broadband contract ends’ petition at: http://epetitions.direct.gov.uk/petitions/50015.
Enforcing these changes would help many consumers who are in the dark about when their contract ends. With new broadband contracts lasting up to 18 months, many consumers simply forget when it is due to expire. In fact, almost half of broadband customers (46%) who are currently in a contract have no idea when it ends.
This can cause consumers harm in two ways. It can prevent them from switching and it can cost them money. Those who want to switch often find it hard to get this information and are put off, while others simply forget about their contract. Almost a third (31%) of those who didn’t move to a new provider when their broadband contract ended, even though they were not happy, said it was because they didn’t know they were free to leave. A quarter (24%) of those who didn’t switch when they could saw their broadband bills increase.
Not knowing this information can cost consumers dear because many broadband deals are based on introductory offers. Amongst the top five deals of each of the five big providers today, 92% have a special short-term offer. This means that consumers can enjoy an initially competitive price, sometimes for the length of the contract, but then their monthly payments will go up. For some this increase kicks in on the day they’re free to leave.
Providing consumers with better and clearer information about when their contracts end can help consumers to feel empowered. This is key to getting them engaged with the market and helping them to save money on their bills. More than four in ten (41%) would feel more in control of their data and deals if information about when their contract ends was published in their online accounts. Almost six in ten (58%) would be more likely to shop around for a better deal if they got a reminder letter a month before their contract ended.
Marie-Louise Abretti, broadband expert at Uswitch.com, says: “This information is crucial if consumers are to get the best deals and not end up paying more than they need to. We urge Ofcom to drag broadband providers in line with energy suppliers and help consumers to feel empowered when it comes to their own bills. Reminder letters and emails and showing the information online would help arm them with the facts they need to get a better deal – as soon as they can.
“Apathy is huge in the broadband sector, even though there are big savings to be made – of around £120 a year – by switching once you’re out of contract. But many fall at the first hurdle – they don’t even know when they can leave their provider.
“Although most mobile networks call you about an upgrade, effectively telling you your contract is about to expire, it’s a lot harder to get this information about your broadband and home phone. Having to call or email may be a step too far for some – especially those already worried about the ‘hassle’ of switching.”
FOR MORE INFORMATION
Katherine Moss
Phone: 020 3021 5893
Email: katherine.moss@uswitch.com
Twitter: @uswitchPR
Notes to editors
All research was carried out online by OnePoll amongst 2,000 respondents in April 2013.
When asked “thinking about how your provider communicates your contract end date, which of the following would you like it to do?” 25.8% said ‘A reminder letter a month before your contract ends’; 23.7% said ‘A reminder email a month before your contract ends’; 9% said ‘A reminder call a month before your contract ends’; 10.4% said ‘The contract start and end date should be on all bills’; 11.5% said ‘The contract start and end date should be on my online account’; 19.8% said ‘Nothing - it's clear enough’.
Of those who are still in a contract, when asked “Are you aware of when your broadband contract runs out?” 38.9% said ‘Don’t know’; 6.9% said ‘Not aware whether I have a contract. In total this equates to 45.8% who don’t know when their contract ends.
When asked “Why didn't you switch broadband provider at the end of the contract?” 54.1% said ‘I was happy with the service’; 44.7% said ‘I was happy with the cost’; 24.5% said ‘It's too much effort to switch’; 11.2% said ‘I didn't/don't know when my contract ran out’ and 10.8% said ‘Other’. Of those who weren’t happy with the cost of service, 31% said it was because they didn’t know when their contract ran out.
When asked “Which of the following happened when your most recent contract ended?” of those who didn’t switch, 12.7% said ‘My monthly bill went up as I'd been on an introductory offer for the length of the contract’; 12.2% said ‘My monthly bill went up because there had been price rises I'd been protected from as a new customer’; 9.8% said ‘My monthly bill went up because I changed my deal’. In total, 24% of people saw their bills go up.
When asked “If information about your contract end date was easily displayed in your online account which of the following statements would apply to you?” 29.8% said ‘I would be more likely to shop around for a better deal as soon as I could’; 26.6% said ‘I would use my online account more and be more aware of my bills’; 40.9% said ‘I would feel more in control of my data and my deals’; 26.1% said ‘None of the above - it wouldn't make any difference’.
From further research carried out online by OnePoll amongst 2,000 respondents in May 2013: When asked “If your broadband provider sent you a reminder letter or email about your contract ending a month before it did, would any of the following statements apply to you?” 58.2% said ‘I would be more likely to shop around for a better deal as soon as I could’; 20.4% said ‘I would use my online account more and be more aware of my bills’; 27.5% said ‘I would feel more in control of my data and my deals’;18.3% said ‘None of the above - it wouldn't make any difference’.
Based on the top five deals from each of the following providers: BT, Plusnet, Sky, TalkTalk and Virgin Media. Correct as of 10th May 2013.
About us
It’s all about “U”!
Thank you for indulging us over the last 20 years by using a small ‘u’ and a big ‘S’ when writing about our brand in your articles.
We are delighted to let you know that you are now off the hook - it’s big U’s all the way (and small s’s) as we undertake our biggest ever rebrand - so let your autocorrect go wild!
About Uswitch
Uswitch is the UK’s top comparison website for home services switching. Launched in September 2000, we help consumers save money on their gas, electricity, broadband, mobile, TV, and financial services products and get more of what matters to them. Last year we saved consumers over £373 million on their energy bills alone.
Uswitch is part of RVU, a new business that also owns Money.co.uk and Bankrate.
If you would no longer like to receive our press releases please email prteam@uswitch.com with 'unsubscribe'.