Monday, 24 September 2007

The Big 18-Month Mobile Contract Scam

If you buy a new mobile phone contract in the UK these days, chances are that the sales person you are going to talk to will try to sell you an 18 month contract rather than a 12 month one. Be extremely careful before you decide to take such a contract. Perks will include a free mobile phone and a slightly cheaper contract than the shorter one. The downside is that you can only upgrade your handset after 18 months rather than 12. Not a major problem you may think if you are not the type who needs the latest handset as soon as it comes out.

Think again. And ask the sales person what is the length of the manufacturer's warranty on the handset. Chances are, the warranty for the handset is 12 months. If your handset starts malfunctioning through no fault of your own while it is under warranty, or once you are eligible for an upgrade, the provider will replace it at no cost to you. However, if your handset plays up after the warranty has expired but before you are eligible for an upgrade, that is during the last 6 months of a typical 18 month contract, then the provider will not replace the handset and you will have to buy one yourself at full market price.

Of course all this is explained in the small print of your contract but no sales person will mention it to you without prompting. So don't forget to ask and if the warranty on the handset expires before you are eligible for an upgrade, don't take the contract.

I just got bitten by that interesting loophole with Vodafone and am now left with a malfunctioning handset for the last 3 months of my contract. Luckily the fault is not debilitating, it just means that the handset occasionally restarts while in the middle of a call, cutting the call short. Not a complete failure then, but still extremely annoying. Evidently, the second my current contract expires, I will go shopping around for a new contract and I will only stay with my current provider if they can offer me a significantly better deal than the competition.

As Vodafone's support told me, everybody else does the same because the handset's warranty is set by the manufacturer, not the network and they have no say in this. Well, maybe they should talk to the manufacturers and solve this loophole. The reason why it should be solved is because the handset is bundled with the contract. You don't buy the handset, you buy a contract to provide you with mobile phone services and you are given a handset as part of that contract to enable you to connect to the service. The cost of the handset is then included in the price you pay for the service and it should be completely covered by the service agreement for the duration of that agreement. In the case where you buy the handset separately, you buy a service and an electronic device to use with this service, there are two separate transactions and it is therefore sensible to treat them separately. Not when the handset is bundled with the service.

I may be barking at the wrong tree but I will definitely contact the Office of Fair Trading and ask them whether this practice is actually fair. I shall update this blog when I have an answer.


stuaxo said...

If it's just for a few months it might be worth getting a cheap PAYG phone or a phone off ebay and unlocking it for the inbetween time.

I've been working in mobiledev and the company aquires a lot of phones from ebay, their fairly cheap and usually in ok condition.

The main thing is to either get a phone on the same network or one thats unlocked/easily unlockable.

Unknown said...

This is the only thing I dislike about mobile phone contracts, the 18 month subscription that comes with them. I was with a network provider in the UK and couldn't wait to finish off my contract with them, and as soon as I did I decided to go through a comparison website called Dial A Phone and now I'm on the best deal I can be on, with a 12 month contract and a decent phone!