MSE News: Ofcom investigates Virgin Media over exit fees

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Ofcom is investigating Virgin Media over exit fees when customers move to an area where Virgin's service is unavailable...

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'Ofcom investigates Virgin Media over exit fees'

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michaels

So we all want free installation and a free superdooper TV box where free obviously means paid of as part of the monthly fee during the minimum contract period and then we also want to be able to leave with no notice. Simple economics means this can't happen - if they ban minimum contract lengths then the install and tv box will have to be paid for upfront.

Doesn't take a rocket scientist to figure this out.

dekaspace

michaels wrote: »

So we all want free installation and a free superdooper TV box where free obviously means paid of as part of the monthly fee during the minimum contract period and then we also want to be able to leave with no notice. Simple economics means this can't happen - if they ban minimum contract lengths then the install and tv box will have to be paid for upfront.

Doesn't take a rocket scientist to figure this out.

It doesn't, if people knew what they were talking about they would realise the equipment you get from VM does not belong to the customer and they charge you for it if its not returned at end of contract.


and people may be ok paying a fee but if they are charged close to or more than £100 then they may be very angry.

iniltous

michaels wrote: »

So we all want free installation and a free superdooper TV box where free obviously means paid of as part of the monthly fee during the minimum contract period and then we also want to be able to leave with no notice. Simple economics means this can't happen - if they ban minimum contract lengths then the install and tv box will have to be paid for upfront.

Doesn't take a rocket scientist to figure this out.

Tend to agree with this, and although may seem harsh, signing up to a minimum term , then before the end of that term, moving to another address, is not the service provider changing the terms of the contract, but the consumer.
If Ofcom decide that ETC's are not good for the consumer and insist they are removed, no doubt the 'law of unintended consequences', will kick in, like when they decided BT offering 2 directory enquired searches for £0.40p was anti consumer , so introduced 118 numbers, that went well didn't it ?
Providers will just move the costs to the front end instead of spreading the installation and equipment charges over the period of the minimum term, so get ready for £100+ installation charges , even when there is service already at the property, £75+'equipment rental' charges' and disconnection charges of £30+ when there are nothing but 30 day notice periods to quit,but don't expect the couple of hundred extra ££'s that you effectively pay now over the 12/18/24 months as part of the monthly fee to be given up by the provider either, the larger than it needs to be cost, to cover the currently free install/equipment charge ,will stay the same, it's just the punter will pay twice, once up front and also via larger than they need to be monthly charges.

Kim_13

Largely I agree that customers should have to pay, however there are a few exceptions:

- Good tenants who have looked after the house, paid rent on time and who the landlord decides to give notice to. They have not done anything to cause the move, or chosen to move and I think it's wrong to expect them only to get services/make any changes with Virgin (at which point they enforce a new contract) at the start of a 12 month fixed term tenancy. They may not be able to find a new rental in a Virgin area in time.

I'm sure there have been cases where some members were moving to a non-Virgin area and wanted to just let the period lapse and pay at the usual rate, even though they wouldn't receive any services. Virgin said no, they had to pay the ETF, which was more than the sum of the fees for the months remaining on the contract. Why should Virgin profit from it if someone needs to cancel? They are only supposed to be put into the position they would have been in had the contract continued to the end. They already profit from the early return of the equipment (less time for it to depreciate/become outdated) so they should just be happy and charge only the remaining months' bills.

robin58

What people writing here don't understand that Virgin Media is not owned by Richard Branson any more apart for 5% stake to kerp the name.

It's now owned by an American company called Liberty. You may know them as they just brought F1.

All that company is interested in now is squeezing as much money as they can from the customer base.. Why do you think they had 3 price rises in a year. Charging customers over the top to leave doesn't surprise me.

It was a good company once until Branson sold out.

Recently, after being with them for 7 years as a customer, I couldn't get a better deal for my loyalty. So I left them. I doubt I will ever go back.

mije1983

As far as I'm aware, Branson has never owned Virgin Media outright at any point so it's not really down to Liberty taking over 4 years ago.

That's by the by though. People want competition, but then complain when they have to pay for it. It's not cheap creating your own network as Virgin have found out.

How do they pay for it? By holding people to the contracts they willingly agreed to. Not sure there is much wrong with that. Pay TV is a luxury not a neccessity.

If the ETCs are judged unfair, then all it will do is push prices up for everyone including those who abide by their agreements as Virgin will need to keep up their profits.

I agree there should be 'some' leeway in exceptional circumstances, but it's ensuring that this isn't abused by people after a free get out clause that will be the challenge.

robin58

mije1983 wrote: »

As far as I'm aware, Branson has never owned Virgin Media outright at any point so it's not really down to Liberty taking over 4 years ago.

That's by the by though. People want competition, but then complain when they have to pay for it. It's not cheap creating your own network as Virgin have found out.

How do they pay for it? By holding people to the contracts they willingly agreed to. Not sure there is much wrong with that. Pay TV is a luxury not a neccessity.

If the ETCs are judged unfair, then all it will do is push prices up for everyone including those who abide by their agreements as Virgin will need to keep up their profits.

I agree there should be 'some' leeway in exceptional circumstances, but it's ensuring that this isn't abused by people after a free get out clause that will be the challenge.

Branson at one time did hold enough to control the direction though.

Plus if your theory holds true why doesn't Sky run in the same way?

At least they will try and give you a better deal.

Plus none of Virgins competitors have this large exit fee.

As for knowledge about Virgin system it has been in my road since the days of Ntl / cable & wireless when our town was one of the first areas to have it because they wanted to connect the business area but also had to supply so many domestic properties at the same time. That was about 24 years ago.

MothballsWallet

Ofcom will screw this up, as they usually do: they're less useful than a limp bean plant.

mije1983

robin58 wrote: »

Plus if your theory holds true why doesn't Sky run in the same way?

What theory?

Just because one company does something, it doesn't mean that everyone has to follow suit. It also doesn't mean that what another company is doing is wrong, unfair or illegal.

For example, some retailers price match, other retailers don't. It doesn't mean other retailers are wrong. It is just the way they choose to do business and people can pick and choose who they deal with. Is it unfair? No.

robin58 wrote: »

Plus none of Virgins competitors have this large exit fee.

Because Virgin are the only ones who have invested billions into their own network that they have 100% responsibility for. And in the bluntest way they need to recoup that cost, plus still make profit.

I also believe Virgin cap their ETC at about £200ish no matter if you owe them more than this.


Also, let's not try and make out that Richard Branson was a consumer champion who was in it for his customers happiness and now a big bad corporate have taken over and are making people pay. I have nothing against him but he is a businessman first and foremost who's aim is to make money, and he is very good at that.

System

mije1983 wrote: »

What theory?

Just because one company does something, it doesn't mean that everyone has to follow suit. It also doesn't mean that what another company is doing is wrong, unfair or illegal.

For example, some retailers price match, other retailers don't. It doesn't mean other retailers are wrong. It is just the way they choose to do business and people can pick and choose who they deal with. Is it unfair? No.




Because Virgin are the only ones who have invested billions into their own network that they have 100% responsibility for. And in the bluntest way they need to recoup that cost, plus still make profit.

I also believe Virgin cap their ETC at about £200ish no matter if you owe them more than this.


Also, let's not try and make out that Richard Branson was a consumer champion who was in it for his customers happiness and now a big bad corporate have taken over and are making people pay. I have nothing against him but he is a businessman first and foremost who's aim is to make money, and he is very good at that.

With Sky, moving is rarely an issue.

The Virgin fee becomes an issue as their cable network essentially a merger of the old NTL / Telewest networks. I've been in two newish properties surrounded by VM Cable (and in both instances) I was told that VM aren't interested in cabling new properties/streets.

The cable networks were actually built by providers that went bust and were taken over. VM didn't spend billions setting up the network, they inherited it.