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Citizens Advice to Three UK – “Stop Ripping Off” Loyal Customers

Friday, September 20th, 2019 (12:01 am) - Score 13,298
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The Citizens Advice agency has this morning called Three UK out for “being the only major provider to refuse to commit to measures to stop ripping off all its loyal customer,” with the organisation claiming that the operator overcharges loyal customers by between £1.5 and £2.7 million a month.

Most mobile operators offer consumers a choice of either taking a SIM-Only plan (i.e. you just pay for the text/calls and data / mobile broadband usage via your own device) or a bundle with a mobile handset (airtime plan). The advantage of a bundle is that it enables consumers to spread the cost of their handset and mobile plan across the contract term (12-24 months), which useful given how much some of the top-end Smartphones cost (£1,000+).

Bundles like this tend to cost a lot and that becomes more of an issue if, at the end of your contract term, the operator keeps taking the same monthly payments as before (i.e. you’ve already paid off the cost of the handset but the operator is still effectively asking you to pay for it). At this point a wise consumer would switch to a SIM-Only option or change plan / operator but not everybody does.

Back in July 2019 Ofcom moved to tackle this and they proposed a number of measures to improve the situation (here), which gained support from almost all of the key players. The only major mobile operator NOT to sign-up was Three UK, which “refused to apply any discount to its out-of-contract customers” and Ofcom thus feared they would “continue to overpay and will not receive similar protections if they stay on their current deal.”

The Citizens Advice’s criticism of Three UK today is thus an echo for Ofcom’s own remarks, except they’ve added a few figures to underline the point. The charity claims – based on publicly available data from Ofcom – that between 154,000 and 210,000 Three customers are paying a “loyalty penalty” each month and on average this penalises them by £10-£13 each month.

Gillian Guy, CEO of Citizens Advice, said:

“It’s unacceptable that Three still thinks it can penalise its loyal customers by over a million pounds every month. It cannot continue to bury its head in the sand.

While Three claims in its adverts that “phones are good”, its customers may find their experience anything but, as their provider falls behind in refusing to end this practice.

We’re pleased other mobile providers have said they’re going to act, but they must now follow through on their promises and put them into effect by early next year.

All eyes will be on Three to see if it puts this right and agrees to stamp out the loyalty penalty.”

The changes proposed by Ofcom are due to be introduced in February 2020. Meanwhile Citizens Advice are keen to point out that Three UK’s current stance appears to conflict with their decision to sign-up to the regulator’s “Fairness for Customers” commitment in June 2019 (here).

By “continuing to rip off customers paying a loyalty penalty”, Citizens Advice argues they have broken this promise. The charity warns that, if this breach continues, Ofcom must make sure Three are standing by their commitment.

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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34 Responses
  1. Avatar Mike

    It’s not a loyalty penalty it’s a dumb tax.

    • Avatar Suz

      Makes sense. Blame the consumer instead of the multi-billion pound corporation.

    • Avatar johnf

      @Suz Corporations are there to make profit, not to give you the best deal which means less profits.

    • Avatar Chris Savvides

      The only way to get 3 to man up with their overcharging is to ensure that signing up with the other operators regards fair play becomes a mandatory requirement for their licence!

      No sign up…no licence!!

      The only other way would be if the negative publicity affects sales more than the cost of ripping people off…I favour the former idea!!

  2. Avatar Michael V

    I think Three are wrong to not do this.

    I’ve been with them for many years. They always call their customers to talk about the end of contract & upgrade options. I do think that customers must know their contract end date which is easy enough to find.
    It’s important for both sides to make the effort, know basic information.

    I’m certainly not defending Three. Seeing as they not joining the other MNOs, now consumers need to be more aware.

    • Avatar Lucy

      For some reason I can’t leave a comment,only reply. Been with three for years.i get Unlimited data and texts for £14 a month.3 are great if you know what deals are available.

  3. Avatar apolloa

    This seems wrong to me? I mean with EE they put yo their prices mid contract, sometimes twice, and you have to call them to get a new deal. Same with O2, it they’ve singles THREE out? I must be missing something as Three has always seemed to be great value to me. But I don’t use them.
    Are they upset that if they bring out a new better cheaper contract, they don’t offer that to existing out of contract customers? Even though everyone does that?

  4. Avatar David H

    Corporations are meant to provide a productive and reliable service, in exchange for profits. Their is a difference between profit and rip off.

  5. Avatar Fred

    Of course a companies first duty is to create a return for share holders. It is up to both legislation, competitive pressure and consumer knowledge to keep the suppliers in check.

    As for Three, they need to decide if sharp practices that are now out of line with their competition will ultimately do more harm or good to their business? Being singled out by the CAB is not good publicity.

    Personally I would not touch Three with a barge pole but they clearly do have a loyal customer base.

    In this case I do think Ofcom should have the power to stamp out this type of practice. It is easy to say that the consumer should do their research but in reality there are times when consumer protection is useful, I think this should fall into that category.

    F

  6. Avatar mr Ian Aitken

    No specific examples given, just seems like a general hit piece against three.

    Why not show exactly how much customers are over paying, no specific examples.

    Seems iffy

    • Avatar Carlos

      I’m with you on this.

      Three have honoured and maintained a 6 year old contract I have with them. There’s 2 sides to each coin and in this case I’m benefiting from them not signing up.

      EE and Virgin in my experience do sneaky price rises and then do whatever they can to lock you in and make it very difficult to leave, they also perpetually sign customers up for a new 12/18/24 month contract.

      If I wanted to leave three, it’s simple. I’ve just left Virgin Media and it took 5 calls and over an hour, they even called me again and again the day after I handed in the notice to harass me into staying, but no, I can’t endorse these unfair practices.

    • Avatar AS

      By saying they won’t go with Ofcom recommendation they assume to be doing it. You don’t need examples, you need to think! If someone bought a contract 2 years ago of 40 pounds per month and the equivalent SIM only deal is, let’s say 15 pounds ,customer will be charged 25 pounds more every month after contract expires. That’s 300 pounds per year on just one customer. Go through their website and do the sums yourself, if you think that’s iffy.

    • Avatar Web Dude

      “Why not show exactly how much customers are over paying”

      because it will very much depend on what a customer’s contract covers…

      In the past I’ve used Three and have usually nought a phone at the low end, then when the end of contract comes along, have usually upgraded (they often have a discount available compared with the website prices for new customers).

      No specific examples because in some cases it may be £2 a month and in others, £20 quid a month (or more) depending on whether someone had chosen a cheap phone with limited data or a ‘flagship’ phone with lots of data (given the unlimited data, SIM-only option from Three is about £20 a month, it would not be unreasonable to suggest that anyone keeping the OLD phone and perhaps lower data allowance is being unfairly charged too much).

      Seems a no-brainer that at the end of contract someone should consider a new phone or moving network, changing to SIM-only, etc, so it does look a bit dumb to pick on Three as surely 99% of this is “buyer beware” – if you just carry on paying and don’t evaluate other options you are either too busy (and can afford it because you are working a lot) or just not doing the sensible thing…

      I don’t like that Three are unwilling to remind customers of there being other options, and thus giving them easy ways to reduce expenditure, but the customers are also to blame, if they are unaware of their contract coming to an end, as someone else said.

      The Three App certainly (when I was using Three) showed the end of contract date and when you could upgrade. I use their “Smarty” service now with month-to-month rolling contract and reasonable SIM-only pricing for all but unlimited (a 12 month contract on Three would save £60 a year).

  7. Avatar StillWaitingForSuperFast

    I dont see why Three have been singled out like this.

    With energy suppliers the onus is on the consumer to know when their deal ends and switch accordingly or see massive price hikes. At least here the price is staying the same, not increasing.

    You snooze, you loose. Simple.

  8. Avatar mike

    I’m on a 12 month SIM-only contract with Three and they sent me a text telling me the contract will be over in two months, and to get in touch to see if they can do a new deal

  9. Avatar John Holmes

    I have an old contract with Three, its 30% cheaper than a current new contract with the same settings. So carry on Three !!!

  10. Avatar Dave

    I buy my handsets outright and get a good value sim only plan on Three..then put a note in my calendar for the contract end date..call back and renegotiate at that point or change to a different operator if that’s better value.
    Why are Three getting the blame for the consumers incompetent and acquiescent attitude?

  11. Avatar G. Virk

    Three mobile is the worst company among all major mobile companies, I was with them for 6 years they were asking 55 pound for the new phone upgrade and at the end i went with o2 and got the same phone, data etc. For 38 pound.

  12. Avatar Phil

    Been with 3 for many years now. I think the 3 at home offer is great value. Always go SIM free and purchase my phone outright. Having said that it seems odd to me that 3 are still incapable of communicating with Google. This for me at least means that WIFI calling doesn’t work on 3 because 3 didn’t bother to send updated settings for H3g to Google. I also am notified before the end of contract about calling them in order to see what they can offer. I was paying 10 pounds for 4GB of data, unlimited calls and texts. Now paying the same but have 8GB of data thanks to a deal I saw on Money Saving Expert. However, 3 couldn’t migrate the new number over to the old one until the old one went SIM free. If I had known that then I wouldn’t have activated the new SIM until the old one went SIM free so ended up paying out 10 pounds that I needn’t have. That’s my fault though. Really happy with my new deal and even 3 support said that they couldn’t offer me something like that and asked me where I got the deal.

    • Avatar Phil

      Meant to say that I am using a Google Pixel 2. 3 told me that if I purchassed a Google Pixel 3 directly from them then WIFI calling will work. Not going to do that. It’s possible that WIFI calling works out of the box on the Google Pixel 3 because 3 sell those. Not at all a fan of the 3 in touch app which does add WIFI calling.

  13. Avatar Carlos

    This is MISLEADING. I’ve had deals with all the major SIM providers in my lifetime. I have to say Three are the only ones not to hit me with hidden charges. I also have a grandad SIM with them that they’ve honoured for over 6 years at £10 month with unlimited data. If Three signed up to this, it’ll go the way of EE and Virgin Media constantly locking in their customers for another 12/18/24 month contract and raising the prices each time.

  14. Avatar Imnotdave

    I’ll be happy to get 4g where I live. I have a 4g mobile broadband router as wired internet is too slow and I’m lucky to get 3g with 3 when I’m at home and with other networks there is no signal at all

  15. Avatar Roger_Gooner

    Three UK is far from being a monopoly MNO. If you’re with Three and their prices are too high, then dump them.

  16. Avatar Ronald caple

    I have been with them for years and always found them to be great value, like many things it’s your responsibility to know when you’re contract is finishing. Just before this go and change your contract if you are happy with the phone you have. It appears that more people upgrade as soon as they can as keep there current handset so are always going to pay more. You are always told when you can upgrade and it’s att that time you can down grade to a sim only. Three are by far the cheapest and best provider in the UK.

  17. Avatar Chris

    Clearly a paid for article with a side agenda. Read between the lines people.

    Three are set to absolutely dominate the UK 5G market both in mobile and home internet solutions. All of their competitors are teaming up and sponsoring BS articles and all sorts of bad publicity in attempts to even the score and scare people away from signing up to Three which is clearly becoming the no-brainer choice with the rise of 5G.

    I have a Three contact and an O2 contract – each provider benefits me for different reasons. Be mindful consumers, do your research, analyze the data and make an informed choice. Definitely don’t let BS articles influence your decisions. No such thing as unbiased media. Everything media related is for profit or carries other type of bias. Be smart.

    • Chris you’re talking complete cods-wallop. Citizens Advice is a pro-consumer charity, they do NOT do paid articles and it’s a public press release on their website! The job of CA is to protect consumers and cover issues that they think are a concern (just look at their website). CA frequently publish reports, surveys and studies into various pro-consumer issues across different industries and are there to help YOU when you need it.

      Now you may disagree with both CA and Ofcom’s independent assessments, that’s fine and lord knows I often criticised the lack of correct context in their research, but let’s keep it factual. So far as I can tell CA have no commercial interests here whatsoever.

    • Avatar Chris

      Mark,

      Just to clarify, my comments were not targeted at your article and commentary but the original content provided by CA which you’ve quoted.

      I’ve formed my opinion based on CA’s choice of words and tone. There’s a lot of praise for other providers with far inferior customer service and nasty customer retention tactics, which to the average consumer are more concerning than the bundle price cost not reducing after end of term. This is in the contract after all, which an educated consumer should be reading before signing. Also most consumers nowadays tend to switch providers at the end of each term based on price and availability of the device/service required. Long gone are the days of loyalty and most sectors, having realised that, have parted ways with the benefits applicable to loyal customers swapping them for more attractive benefits to new customers.

      Overall across the media lately there has been a lot of negativity surrounding Three. Their infrastructure developments have put them in a position to have somewhat of an unfair advantage over competitors. However, apart from their own marketing, this does not get any media attention. Most of the content creators appear to be actively seeking negatives to highlight in relation to Three. It seems too much of a coincidence all this negative press just as they’re about to launch the best in class service.

      Maybe CA’s intentions are good and pure. Maybe I’m wrong. In any case I still believe the consumer should be doing their own research and not solely trusting any third party even if they’re as reputable and proven pro-consumer organisations such as CA and Ofcom. Also, we should always read what we sign.

    • Avatar beany

      “So far as I can tell CA have no commercial interests here whatsoever.”

      You may want to look a bit deeper…
      https://www.citizensadvice.org.uk/about-us/support-us/company-giving/company-partnerships-and-supporters/

      Most of their funding comes from Government and government departments, they are also however funded by private firms, some they do not like to talk about too much… One for example that is not listed on that link is Facebook (just do a quick google for numerous results on that).

      They also rather suspiciously used a BT site…
      https://mydonate.bt.com/charities/citizensadvice
      to collect private and public donations. Funnily enough wasn’t EE moaning about some 5G claim by Three to the ASA a month or so back??? All coincidence im sure though 😉

  18. Avatar Leeman

    If the customer calls Three, they will give a great deal.
    I called them after my contract ended and they gave me a deal 60% cheaper and on a shorter contract period.
    They are always looking to make deals to retain customers and their sales team have massive discretion on how low they can go.
    If you don’t call them, the contract automatically reverts to a month by month contract at the same monthly price as the expired one.

    • Avatar Alexander Boris de Pfeffel Johnson

      We know that. The article is about automatically applying discounts to those not intelligent enough to realise they are out of a deal and are paying over the odds.

      Just like utilities, every other rip off supplier in the not so Great GB.

    • Avatar Leeman

      Three actually tells you when your contract is about expire about a month or two out and urges customers to contact them to negotiate fresh terms and pricing.

  19. Avatar Mark

    Anyone even thought about GDPR! Three can’t just change people’s plans without there concent, so maybe that’s why they can’t change people’s plans or add discount accessing people’s details without there permission!

    • Avatar AS

      The other operators will be able to do it but not Three because of GDPR? How does that work?

    • Avatar Web Dude

      “Three can’t just change people’s plans without there concent”

      Oh yes they can, and they have – they decided that some people on the One Plan were abusing the “unlimited data” feature so unlike nearly every other company I’ve known, they decided to abandon the “legacy” “One Plan” and cancel those contracts, giving a customer the option to sign up to another deal or leave. (In my case I was paying £15 but they said I could switch to a new contract at over £28/month instead… I voted with my wallet and left).

      GDPR is a specious reason. The information held is not significant unless traded or lost. You are their customer and while they should not impose “unfair” conditions, discussing your plan with you, or reducing the monthly fee, are perfectly acceptable options.

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