Broadband contract termination charges slashed

Despite voice and broadband suppliers BT, TalkTalk and Virgin Media believing their early contract termination charges were fair, they have nevertheless...

Despite voice and broadband suppliers BT, TalkTalk and Virgin Media believing their early contract termination charges were fair, they have nevertheless agreed to cut them by up to 85%.

Ofcom said today many consumers were trapped in unwanted contracts for their telephone and broadband service. Ofcom has been negotiating for 18 months to ensure that early termination fees reflected suppliers' savings from not having to provide the service when a subscriber quits early.

"Ofcom's interpretation of the regulations is that consumers who end contracts early should never have to pay more than the payments left under the contract - in fact they should often pay less, to reflect the costs providers save because the contract ends early," the regulator said.

BT started cutting the fees when Ofcom first said it was going to look at them. After discussions, all suppliers slashed their charges.

However, they do not disappear, but reflect recovery of the fixed cost of the line. All residual amounts are payable monthly until the end of the contract period.

For example, BT's Unlimited Anytime fee dropped from £16.53 to £8.00 and now to £5.00; Talk Talk's Anytime fee went from £16.98 to £3.00, and Virgin Media's from £29.99 to £6.63 for the first month after cancellation, and then £4.63.

The full list of new charges is here.

Read more on Voice networking and VoIP

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