Beware of rolling contracts

Going_Digital

Anyone looking at phone services should look carefully at the terms before committing to anything.

It is sadly becoming more and more common for telecoms companies to use an unfair rolling contract where after the initial contract period has completed you are automatically signed up for a new contract for the same length of time.

People are used to the idea of signing up to a contract for example for a year in return for avoiding paying an upfront installation cost. The cost of installing a new line or being supplied with a modem as part of a broadband package for example. This is all fair enough as it allows the supplier to recover the upfront costs through the length of the contract. The situation that most people are used to is that at the end of the period the contract no longer applies and a fair notice period can be given, usually 1 month to terminate a service.

On a rolling contract however you are automatically locked in for another period without receiving anything in return. Some providers make it especially difficult to get out of these contracts by for example requiring written notice at least 42 days before the automatic renewal date. These rolling contracts are nothing more than an attempt to lock you into a service for the benefit of the provider. The question has to be asked, why should they need to do this if their service is as competitive or as high quality as they make it out to be ?

Be wary of any provider who tries to lock you into a long term rolling contract.

Inactive

Good advice, mine has a 30 day contract only.

DVardysShadow

Terminology. These are not rolling contracts, they are auto-renewing. A rolling contract I regard as 30 days notice at any time after any initial minimum period.

The reason I am so picky about this terminology is that if 'rolling contract' is accepted as the terminology for 'auto-renewing' contract, the confusion when you talk to call centres will be complete.

Going_Digital

DVardysShadow, I understand what you mean but there already seems to be some confusion over what is meant by rolling contract and most of the providers are using the term to describe an auto-renewing contract.

As far as I am aware a rolling contract just means that the contract is continually renewed for the initial period. So you can have a 30day rolling contract, where you are automatically renewed for another 30days at the end of each month. This is quite common but is different to a matured contract.

There are two parts to a contract, there is the basic conditions of the contract that apply for the whole duration of the service and then there is the minimum term.

A matured contract is one where the agreed initial contract period has been reached and therefore you are no longer held to the minimum period terms. Your obligations for the minimum term have been met and therefore the contract has matured. All other terms of the contract apply such as acceptable use policies and 30 days notice to cancel a service.

You can also have a contract that has no set term but has a cancelation notice period, this is a perpetual contract without a set term.

DVardysShadow

Going_Digital wrote: »

DVardysShadow, I understand what you mean but there already seems to be some confusion over what is meant by rolling contract and most of the providers are using the term to describe an auto-renewing contract.

Yes. It is called 'confusion marketing'. It is why I balk at the use of the term 'rolling contract' by the suppliers. They are using the term to deceive customers and hide the fact that the contract is autorenewing. If they get away with hijacking the term 'rolling contract', then there is no language left to describe the concept and it will become impossible to ask for a contract which is rolling rather than auto-renewing. It may be OTT, but I have little doubt that the language is under attack by the companies in the pursuit of profit.

Buzby

From the way you wrote that, I assumed that the poor consumer was being taken as a mug. However, you conveniently forget the quid pro quo that comes with the auto-renewing contract.

Because of the lock-in, only a fool would be prepared to accept this without some sort of benefit - and the benefit has always been clear, You agree t the deal, and BT will give you free EVENING and weekend calls, an improvement on the non lock-in deal of only free weekend calls.

So - consumer has a choice. Agree and get free calls in the evenings from Mon-Fri, or don;t - only only get them on Saturday and Sunday.

I dislike carrot-and-stick approaches such as these, I believe they treat the customer with disrespect, and until I left them after 40 years as a customer, I never took the bait. The decision - as always - is up to the consumer. Don't complain when it doesn't go your way down the line. You can really only blame one person, and it isn't BT.

Mark_In_Hampshire

On this very subject:

http://www.telegraph.co.uk/finance/personalfinance/consumertips/household-bills/7291230/BT-pulling-a-fast-one-over-contract-cancellations.html

Buzby

This is another of Which?'s pseudo-science survey's. Previously called the 'Consumer's Association' they complain of the lack of information provided on the phone. As the contract runs for nearly 2000 words, are BT being criticised for not reading this out? If they did, the chances are customers would have forgotten 99% of it, only remembering things they like - like the 'free' bits.

Once signed up - you get the details in the post, can then read up and cancel under DSR. No problem.

They've been a laughing stock for a while, but it's only a matter of months before they are taken as seriously as the Daily Mail and IT'S rants of indignation!