MSE News: Tesco Mobile promises no mid-term price hikes

shteve

Sparx wrote: »

Because they are sister companies? Both owned by EE.. :think:

I don't understand the point of your post.. Yes, Tesco use the O2 network..

I took it to mean sister companies to Tesco mobile, not to each other.

NFH

MillicentBystander wrote: »

24 month contracts are for idiots (and I class myself as one as I'm 12 months into one at the moment but never again). Buy the phone outright and use a 30 day SIM only deal (there are some amazing deals out there at the moment even including one that is free!). You know it makes sense.

I couldn't agree more. I would like to see an end to the up-front cost of mobile phones being subsidised by long service contracts with inflated monthly charges for the following reasons:

• It encourages consumers to acquire handsets they cannot truly afford through an unhealthy "buy now pay later" consumer debt culture.
• It distorts competition by disguising the true price of the handset and of the service, as opposed to a SIM-free handset and SIM-only service.
• It encourages wasteful acquisition of new handsets because consumers mistakenly believe they are receiving the handset for free or for very little.
• It necessitates long contract durations in order to spread the cost of the handset, which inhibits competition by preventing consumers from switching networks.
• It causes consumers to continue paying the inflated monthly charge even after they have paid off the subsidy of the handset, unless they remember to take action at the end of the minimum contract period.

Subsidised handsets are usually SIM-locked which:

• Inhibits competition as it makes it more difficult to switch networks.
• Prevents consumers from using local SIM cards abroad, allowing UK networks to impose unreasonably high roaming charges by excluding foreign competition.

For these reasons, Ofcom should encourage unsubsidised SIM-free handsets and competitive SIM-only contracts to become the norm, as is the norm in many other countries. At the very least, networks should be forced to unbundle the monthly handset subsidy repayment and the monthly charge for service, itemising the two separately with independent contract durations. The monthly handset subsidy repayment should not be allowed to continue after the cost of the handset has been paid off.

You wouldn't expect to receive a television through your pay-TV provider or a computer from your ISP and pay it back over 24 months, so why are mobile phones primarily sold in this way?