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ISPs get nine months prep time for Ofcom shake-up of broadband contract renewal rules

Regulator Ofcom is giving broadband, phone and pay-TV service providers nine months to ready their systems and processes for the emergence of new rules, designed to make it easier for consumers to switch providers

Ofcom has introduced new rules ordering providers to make existing customers aware of the best deals available to them when their broadband, phone and pay TV contracts are nearing an end.

The rules, which were foreshadowed by the regulator back in December 2018, put the onus on providers to notify consumers each year about any new deals they have introduced, and ensure they are briefed on when the end-date for their current contract is approaching.

The latter notification must take place 10-to-40 days before the contract end date, and be delivered in the form of a text, email or letter.

It must also include details of any changes to the service or price customers will be subjected to once the deal they have previously be subscribed to ends, and state how much notice they will be expected to give to exit the contract too.

It is Ofcom’s hope that passing on such information will empower consumers to switch between providers in pursuit of a better deal with greater ease, and stimulate competition between suppliers.

“Our research shows that more than 20 million customers have passed their initial contract period. Many of these could be paying more than they need to,” said Ofcom in a press statement. “People who bundle their landline and broadband services together pay, on average, around 20% more when they are ‘out of contract’. This rises to 26% among customers who bundle their pay TV with these two services.

“Around one in seven customers (14%) don’t know whether they are still tied to their original deal; and around one in eight (12%) believe they are ‘in contract’, but don’t know when this period ends.”

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Ofcom is giving providers nine months to prep their systems and processes for the changes, and confirmed consumers will start to receive the notifications from 15 February 2020.

Lindsey Fussell, director of Ofcom’s consumer group, said: “We’re making sure customers are treated fairly, by making companies give them the information they need, when they need it.

“This will put power in the hands of millions of people who’re paying more than necessary when they’re no longer tied to a contract,” said Fussell.

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