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Ofcom to tackle ‘shock’ phone bills

Ofcom to tackle ‘shock’ phone bills

Category: Mobile Phones

Updated: 14/12/2012
First Published: 01/03/2012

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This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Consumers could be given greater protection from 'shock' mobile phone bills after an action plan was set out by communications regulator Ofcom.

It follows what Ofcom says was an 'extensive review' into problems, with research finding that as many as 1.4 million mobile phone customers have been hit with unexpectedly high bills in the last six months alone.

The regulator is to work with the mobile industry to address some of the main issues it found, which included high bills caused by:

  • downloading data, primarily while travelling outside the EU, but also when using data in the UK (for example, customers using smartphones which may download data without the customer realising, or not realising how much data they are using);
  • using mobile voice services in the UK , mainly by exceeding inclusive allowances or calling numbers outside of allowances; and
  • lost or stolen phones – where the number of consumers affected is low, but the level of financial harm can be substantial.

Under European rules, all mobile operators must apply a cut-off limit once a consumer's mobile internet bill reaches 50 Euros – around £42 – per month, while travelling in the European Union, with customers alerted after using 80% and 100% of their allowance.

This could soon be widened to worldwide protection as soon as June 2012, and Ofcom is lobbying mobile providers to voluntarily introduce the caps and alerts before any legislation takes effect.

Consumers could also see the amount they can download before they hit financial caps increase in the next couple of years, as there are currently proposals to enforce steep price reductions at both wholesale and retail levels which will allow savings in wholesale costs to be passed on to consumers.

This will mean that consumers will be able to download significantly more data when abroad, before reaching the 50 Euro limit.

Ofcom has written to the mobile providers calling on them to do more to develop and promote 'opt-in' measures, such as tariffs that allow consumers to set their own financial caps or receive alerts about usage.

And the regulator is also urging providers to make customers aware of how they can protect their handsets with bars and passwords to prevent thieves running up a huge bill in the event their mobile phone is stolen.

"Ofcom's report confirms what consumers have been telling us for years - that bill shock is a big problem with as many as 1.4 million mobile phone customers affected in the last six months alone," said Which? executive director, Richard Lloyd.

"We want clearer information for customers from the phone companies about what they charge for services in the UK and abroad, plus greater protection for consumers from hefty data charges.

"Ofcom must stand by its promise to investigate data roaming measures in the UK if EU negotiations fail and we want to see more pressure put on UK operators to adopt data caps and spending alerts."

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