MSE News: O2 to hike its prices by 2.7% - can you leave your contract penalty-free?

O2 are not allowing customers to leave their contract free of charge.

Their new T&C dated January 23rd state that a price increase (or decrease) by RPI is mandatory once every 12 months starting March 2014.

This is also to be communicated at point of sale across Online, retail and telesales.

Therefore O2 are actually selling contracts which explicitly state a price increase. Therefore no one can cancel.

So far O2 are the only network to assume this new position and introduce price increases for all customers as a standard thing. It's a loophole to get around Ofcom's new guidelines introduced today.

Vodafone and Three have stated they will not increase prices for consumers from January 23rd, if they do then customers will be free to leave as per Ofcom guidelines.

EE have yet to announce their plans. I fear O2 will have some backlash (rightly so) and if EE follow then I expect them to lose over 1 million customers this year like they did before with the previous price increases.

MSE Helen, when does a price rise become a "Hike"?

It seems that if something goes up by any level at all, it's a "Hike". Surely it's just a rise, or do you use the scary word "hike" in a hope to drive people to fear and worry that their choice is between feeding the children or paying the phone bill?
After all, a 2.7% hike on a £40 bill would be £1.08 - the price of a cheap burger.

ZhugeEX wrote: »

So you advocate networks being able to increase prices when they like?

Some people just want to watch the world burn

No, I advocate sensible reporting. It's the constant use of the word "Hike" on here, implying a massive rise. That's my issue.

I'm not talking about the rights and wrongs of what O2 have done. I'm not interested in watching the world burn.

"But Ofcom's new rules....."

Correct me if I am wrong but I seem to remember Ofcom clearly stating that they had NOT introduced any "new rules", merely clarified the old rules...

And IIRC they basically said that any price increase within the contract term would be considered "material detriment"...... therefore I can't see how the clarification only applies from a certain date and before that the clarification doesn't somehow apply?

Therefore if I was on O2 the I would follow the CISAS complaints procedure on that basis for penalty free termination of my contract. Look how many people did similar with the EE

How will this affect the likes of Tesco Mobile and GiffGaff that use O2's network?