Virgin Media's £240 early exit fee may be unlawful,

[Chloé Palmas]

Originally Posted by Kushan

The issue isn't anything to do with paying to end a contract early, the issue is that people are being forced to pay too much.

By whose standard? Nobody made anyone else arbitrator / arbiter of all this.

In fact, it is not even a court that has ruled this, just a regulator with binding power.

Hopefully if this is the way that the decision goes, VM will take this to court.

Of course Virgin eats installation costs, etc. when a user signs up, that's why minimum contract terms exist, but if you end a contract 10 months early, that's 10 months of service Virgin doesn't have to provide you.

No minimum terms exist so that you commit to the length and duration of the contract.

The only reason that Virgin doesn't have to provide the service, is because the customer cancelled the contract!

Charging people for it is wrong.

They agreed to the fees when they took out the contract though. (Early termination fees etc). They shouldn't have taken the contract if they couldn't honor it, should they?

---------- Post added at 21:54 ---------- Previous post was at 20:53 ----------

Originally Posted by nomadking

What will happen is that there will be large upfront fees and no discounts for renewal of contract. How is the customer winning?

Could be even worse - as it is VM charge for installation and keep equipment, right?

In the end, they could make you pay 6 to 12 months up front (just to be on the safe side) and then guarantee service for that time period. Even BT allow for upfront plans to pay line rental - VM will start doing the same.

---------- Post added at 21:59 ---------- Previous post was at 21:54 ----------

Originally Posted by Mr K

Well, the telecoms watchdog disagrees and thinks it unfair. Tough luck VM.

Not quite - they said the fees were excessive. A simple way for VM to get round this, is only charge the entire amount of duration for the remainder of the contract, which you agree to in the T&C. They may need to make them clearer though, like Telefonica does. (You are being this amount of credit etc etc - though it does work slightly different for phones, as you get to keep them).

The 240 sounds like a summary / default sum and that seems to be what Ofcom says is going too far but even at that they say that the terms are unclear. If VM spells it out a lot better than things will be difficult to dispute.

[RobboEdin]

The 240 figure is a cap.
The actual number is based on the number of months left and which services you have. It is well documented.
http://www.virginmedia.com/shop/the-...tion-fees.html

[Mr K]

People move house, it happens. If they move house just to get out of a VM contract I would call that a bit extreme. As far as I'm concerned the contract is with the customer, as long as they are staying in the UK, and VM can't provide a service at a new location, then its VM that are breaking the contract. The telecoms watchdog obviously agrees and looks like VM will have to change their ways. I've been a customer for 22 years, I'd be a bit miffed if VM charged me an early disconnection fee, which they could do with the current set up !

Originally Posted by Mr K

People move house, it happens. If they move house just to get out of a VM contract I would call that a bit extreme. As far as I'm concerned the contract is with the customer, as long as they are staying in the UK, and VM can't provide a service at a new location, then its VM that are breaking the contract. The telecoms watchdog obviously agrees and looks like VM will have to change their ways. I've been a customer for 22 years, I'd be a bit miffed if VM charged me an early disconnection fee, which they could do with the current set up !

That’s an "interesting" viewpoint.

The contract states they are providing a service to the customer at that specific location, and also states if the customer terminates the contract early (for whatever reason) there will be a penalty charge (depending on the time left on the contract). There is an upfront cost to the supplier for the equipment and installation, which is amortised over the contract period - if this ruling is upheld, I would expect the up-front costs to increase.

If you rent accommodation on a fixed term lease and decide to leave early, you have to pay the remaining rent - what’s the difference?

[Mr K]

Originally Posted by Hugh

That’s an "interesting" viewpoint.

The contract states they are providing a service to the customer at that specific location, and also states if the customer terminates the contract early (for whatever reason) there will be a penalty charge (depending on the time left on the contract). There is an upfront cost to the supplier for the equipment and installation, which is amortised over the contract period - if this ruling is upheld, I would expect the up-front costs to increase.

If you rent accommodation on a fixed term lease and decide to leave early, you have to pay the remaining rent - what’s the difference?

That's an "interesting" post Hugh

There obviously is a problem or VM wouldn't be in trouble with the watchdog.

Its not VMs interest anyway, if customers feel unfairly treated they could lose their custom for life (not temporarily) and that of anyone they tell. This issue has been raised a few times now in consumer columns/programmes, all bad publicity.
https://www.telegraph.co.uk/bills-an...ovide-service/
https://www.thesun.co.uk/money/53615...h-no-coverage/
https://www.theguardian.com/media/20...ncellation-fee

So why don’t the customers do what VM suggested in the article?

"We make it clear to customers that early disconnection fees can apply and we also offer 30-day rolling contracts for those that do not want to sign up for a minimum period, such as 12 months, and need more flexibility."

Because OFCOM made it clear it wasn’t about people moving home, it was about switching providers.

This is largely because the fees charged are too high and will have deterred customers from switching providers.

People want the best of both worlds without paying for it.

Originally Posted by Mr K

https://www.telegraph.co.uk/news/201...les-customers/


Oh dear, VM in the dock again. Always thought it was unfair that they charged customers just because VM can't provide a service at a new property. Its VM that are breaking the contract. They are going to have to review that policy and cough up some compensation.

btw, OFCOM haven’t said the Early Termination Charges are unfair, just that they are too high.

https://www.ofcom.org.uk/about-ofcom...cases/cw_01198

The fairness of terms within Virgin’s consumer contracts which require customers who move home outside of Virgin’s network (and are therefore unable to continue to take Virgin services) to pay ETCs does not fall within the scope of GC 9.3. We are continuing to consider whether these terms raise concerns under the Consumer Rights Act, and if so what action might be appropriate, and we will provide an update in due course.

[Kushan]

Originally Posted by Chloé Palmas

By whose standard? Nobody made anyone else arbitrator / arbiter of all this.

Well....by OFCOM's standard, apparently.

Originally Posted by Chloé Palmas

No minimum terms exist so that you commit to the length and duration of the contract.

The only reason that Virgin doesn't have to provide the service, is because the customer cancelled the contract!

And? That doesn't detract from the fact that Virgin no longer has to supply anything to the property - the customer no longer "costs" them anything, so why should the customer pay the full amount for the service?

Originally Posted by Hugh

That’s an "interesting" viewpoint.

The contract states they are providing a service to the customer at that specific location, and also states if the customer terminates the contract early (for whatever reason) there will be a penalty charge (depending on the time left on the contract). There is an upfront cost to the supplier for the equipment and installation, which is amortised over the contract period - if this ruling is upheld, I would expect the up-front costs to increase.

If you rent accommodation on a fixed term lease and decide to leave early, you have to pay the remaining rent - what’s the difference?

The point is if you're going to have to pay the full amount, why bother to cancel the contract at all? In both cases, the supplier can supply service to another person in your place, the accommodation can be rented out. I am not saying contracts should be worthless, I am simply saying there has to be a limit on penalty exit fees. If that means higher sign-up fees then so be it.

Not everyone knows their circumstances 18 months from now.

[RobboEdin]

As said earlier, there is a limit on the penalty of £240.

[Stephen]

You create a contract with the supplier for services to that address for a minimum term. Likelihood is that the company will only start making money off you after so many months. There for if you break that for any reason you are liable for the remaining term. This is the same for Sky or BT or añy mobile contract.

I've heard people calling to try and get out of paying after trying to break a contract early. IE no or poor signal, broke their phone, not being allowed fixed services in rented accommodation. Fire that means they won't be staying at the property for months.

Yes there are sometime really valid reasons but it's something that may be considered whether the early termination charges will be charged or not.

At least VM set limits. Mobile ETFs can be very expensive, as there is no limit and the cost of a handset will need to be recovered.

[Chloé Palmas]

Originally Posted by Kushan

And? That doesn't detract from the fact that Virgin no longer has to supply anything to the property - the customer no longer "costs" them anything, so why should the customer pay the full amount for the service?

Because the customer agreed to do so, in the first place...(for the duration of the contract).

[richard s]

All 18 Month contracts should be banned across all devices and platforms a 12 month rule should be the norm.

[djfunkdup]

Originally Posted by jcm193

Perhaps ofcom should also look at virgin`s policy of putting you on a fresh 12 month contract when you also change your tv/broadband packages etc sky don't do this

They don't put you on a fresh 12 month contract when you change packages.i went from Vivid200 to Vivid350 and i never had to re-contract with VM.The only thing that changed was the increase in £ each mnth with the tier upgrade.



.

[jb66]

Originally Posted by djfunkdup

They don't put you on a fresh 12 month contract when you change packages.i went from Vivid200 to Vivid350 and i never had to re-contract with VM.The only thing that changed was the increase in £ each mnth with the tier upgrade.



.

That should have been free

[Arthurgray50@blu]

I would like to jump in this conversation.

When my wife and l joined cable TV many years ago. I accepted what the sales advisor told me and my wife.
The Cable Corperation came down out street. We fell for the sucker punch. We were told that we would get 500 channels plus radio channels. Got it installed. And found out that we would NOT get that amount of channels and the sales advisor should not have said that. Cable Corps was gone within 24 hours. They told me that we were in breach of contract - l stated that l would go to court. They stopped from there.

We then went onto Telewest. We were told nearer enough the same about channels etc. They then started to take off channels that we watched. We got told that they can do that. I cancelled the contract. As they failed to supply me those channels that we watched.

Niow with VM. We have the same problem. Despite the sales staff, and there silly town centre sales staff. I have spoken with them several times about what is coming up. They have told me that we will get new channels this year. Where ? I read on this forum that new channels will ONLY appear when deals are up.

We now only have the basic channels, because of the cheap phone system on VM. Because we were told they were cheaper.

The contract l get told about - l keep the company to it. If they don't live up to that contract, l will cancel it. And we are legal entitled to do it.

I have don't this several time before, and l will do it again.

If a VM sales rep tells me that l will get (for example - 700 channels, top BB and FREE phone. FREE BT sport) and l don't get it - that is a breach of contract as it has been verbally given.

Even if you sign a contract, l would suggest that people read there contracts. As in the contract, as we get it in all the literature we get through the door. Such as VM supply top quality channels and BT Sport. And you don't get it. That is a breach of contract.

So just read the contract properly. Even an installation connection. This is just a way of making money. As the live cables are still there, whether its Sky, VM or any other supplier.

[Chloé Palmas]

Originally Posted by richard s

All 18 Month contracts should be banned across all devices and platforms a 12 month rule should be the norm.

Why? That seems like one of those rather "plucked out of _____" (insert your own word here), kind of comment.

So let's say "thin air" are the words. Why does thin air = 12 months, only?

Why is that the standard bearer?

---------- Post added at 01:50 ---------- Previous post was at 01:49 ----------

Originally Posted by jb66

That should have been free

Are you sure that it wasn't?

---------- Post added at 01:51 ---------- Previous post was at 01:50 ----------

Originally Posted by jcm193

Perhaps ofcom should also look at virgin`s policy of putting you on a fresh 12 month contract when you also change your tv/broadband packages etc sky don't do this

If you get an introductory offer, Sky absolutely do. Minimum 12 to 18 (to take advantage of the offer, for the period of the contract you signed up for).

---------- Post added at 02:00 ---------- Previous post was at 01:51 ----------

Originally Posted by Arthurgray50@blu

Even if you sign a contract, l would suggest that people read there contracts. As in the contract, as we get it in all the literature we get through the door. Such as VM supply top quality channels and BT Sport. And you don't get it. That is a breach of contract.

Even if it is just a promise on the phone, calls are recorded so I would say that is a way to hold an advisor / sales Rep to the deal.

Though my advice would be to notify them of your intent, ask for the playback / copy of the call first, and see what they offer you. Usually they can work something out for you - but as the lender they have an easy option to mark a default (even if in dispute) on your credit file if you don't pay for the following months, so be careful. Not to mention, at the moment Telecoms don't mark the equipment down as credit but soon they may start saying that not only are you in breach of contract but there are goods of theirs that you now possess illegally.

So just read the contract properly. Even an installation connection. This is just a way of making money. As the live cables are still there, whether its Sky, VM or any other supplier.

This is not necessarily the case. The house we just moved into had a BT line so we can use Sky just fine but the wires are so antiquated and out of date that an engineer had to come round (Open reach) and install a new master socket and redo the line from the exchange. As we had moved in first and reported the fault it was at no cost to us. The installation / move / fix (whatever you want to call it), did cost someone though. (In time, labor / parts etc).

---------- Post added at 02:07 ---------- Previous post was at 02:00 ----------

Originally Posted by Kushan

The point is if you're going to have to pay the full amount, why bother to cancel the contract at all? In both cases, the supplier can supply service to another person in your place, the accommodation can be rented out. I am not saying contracts should be worthless, I am simply saying there has to be a limit on penalty exit fees. If that means higher sign-up fees then so be it.

Not everyone knows their circumstances 18 months from now.

Okay I am not coming at it from a know-it-all perspective of being sure of everything for the next 18 months but why should I have to pay more to sign up because of the potential risk of other customers who have a greater liability not to stay the course? I mean if I stick it out for 18 months, am I not just paying more for the install for no reason then?

If you sign up to a contract and break it then you are responsible for the early termination fees, not everyone. Collective responsibility is not for situations like this and there is no good reason for new potential customers to have to pay more for no reason - though they will likely factor that in when they make their decision anyway.