Consumer organisation Which? has launched an attack on Virgin Media’s pricing tactics following the rollout of new contracts this year.
- Which? has highlighted recent changes to Virgin Media contracts which mean they can now enforce inflation-busting price rises.
- Ofcom is already investigating Virgin Media over perceived hurdles customers have to overcome if they want to leave.
Which? says Virgin Media’s new terms and conditions are an attempt for the firm to “have its cake and eat it”.
Virgin Media’s terms and conditions state that the firm can change its charges “at any time”, whilst a new clause says that in future, customers will face annual price rises above the rate of inflation.
The company has introduced new contracts that will no longer allow TV and broadband subscribers to leave without a penalty. Virgin Media has also lifted the Early Disconnection Fee cap, meaning subscribers can now be hit with a much larger charge.
Which? has now formally raised concerns with Ofcom, saying it “believes it is the most egregious example of unacceptable price hiking practices across the broadband industry.” But it’s not the only pay TV or telecoms provider that has inserted inflation-busting clauses.
Most providers have copied each other with a 3.9% plus inflation price rise formula. But Which? believes that the Virgin Media contract clauses could be in breach of the Consumer Rights Act by creating “a significant imbalance” between the rights Virgin Media has granted itself and those of the customer.
Existing Ofcom investigations
Ofcom is already reviewing these inflation-linked mid-contract price rises. It had previously banned providers from increasing prices mid-contract, but providers found a way around the rules by building in price rises based on a formula within the contract. And as most providers introduced identical clauses, customers found they had no way around, particularly if they wanted to access certain pay TV services.
Last month, Ofcom also announced an investigation into Virgin Media’s customer service after customers complained the company was making it difficult to leave.
What has Virgin Media said in response?
Virgin Media says it rejects the “baseless” allegations. It has counterclaimed that Which? had “wilfully misrepresented” a separate clause in its terms and conditions, which are written “almost identically” to clauses found in other the terms of other providers. It says it’s always been open and transparent about price rises.