Mobile Contract Lengths

NFH

WTFH wrote: »

Another ill-thought-out vote winner, looks like a good deal for consumers but ultimately means higher prices for those of us who aren't interested in upgrading every 6 months or screwing people over, instead some of us just want a good, reliable service and are happy to pay for it.

If the networks change their method of selling as a result of this legislation, then they can protect themselves against its effects. For example, if they all start pushing 6-month SIM-only contracts and full-price handsets, this will mean lower total prices for all through increased transparency and competition, as well as consumers only acquiring handsets they can afford. In many other countries, full price handsets and SIM-only contracts (or PAYG) are the norm. I hope this norm spreads all over the EEA including the UK.

WTFH

...in your opinion/experience.

But in my opinion/experience, shorter contracts = higher prices, because they have to make the money from you quickly rather than slowly.
Setting up a contract costs the same whether it is a 1 month one or a 2 year one. That's the cost of the paperwork, processing, etc.
Let's say the cost of setting up a contract is £20. So, to set up a 2 year contract costs £20. To set up 4x 6 month contracts costs £80.

Tell me where the other £60 is coming from?
A contract that was costing £20 a month has to go up by £2.50 per month to cover the extra costs. That's a 12.5% price "hike". If every phone company announced that, this forum would be rife with complaints about how bad they are, how greedy they are, etc, and if anyone dared point out that the reason for the increase was because of a stupid EU law to protect stupid greedy consumers, well, they would be kicked off the forum!

NFH

WTFH wrote: »

Setting up a contract costs the same whether it is a 1 month one or a 2 year one. That's the cost of the paperwork, processing, etc.
Let's say the cost of setting up a contract is £20. So, to set up a 2 year contract costs £20. To set up 4x 6 month contracts costs £80.

It doesn't have to cost this much if more networks follow the Giffgaff model of pay-monthly on a prepaid (as opposed to postpaid) basis. This has the added advantage of preventing bill shock. Whereas this forum is full of people in the summer complaining of enormous roaming bills, in Giffgaff's forums they instead complain of running out of credit abroad and having no service. Many consumers are not responsible enough to pay on a postpaid basis, either for the service or the goods.

WTFH

NFH wrote: »

It doesn't have to cost this much if more networks follow the Giffgaff model of pay-monthly on a prepaid (as opposed to postpaid) basis. This has the added advantage of preventing bill shock. Whereas this forum is full of people in the summer complaining of enormous roaming bills, in Giffgaff's forums they instead complain of running out of credit abroad and having no service. Many consumers are not responsible enough to pay on a postpaid basis, either for the service or the goods.

Which is fine if you are a light user who needs to prepay, but is useless if you do a lot of travelling, have phone bills which vary greatly, and you are happy not having to check and top up all the time. I don't have prepaid electric or prepaid landline, I don't have a prepay mortgage, or prepay on fuel.

Smart users should not be punished because of stupid greedy ones. Unfortuantely most laws now are being written which say the exact opposite - if you're good with your finances you are penalised so that businesses have the reserves to pay out to those who don't understand the concept of responsibility or the concept of Martin's Mantras.

MikeWhite

WTFH wrote: »

I don't have prepaid electric or prepaid landline, I don't have a prepay mortgage, or prepay on fuel.

Keep an eye on forthcoming EU directives, maybe we will all have to have them. The wonders of legislating to the lowest common denominator.