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Virgin Media ads should have made clear that broadband prices could rise

Wednesday, July 22nd 2015 by Phil Wilkinson-Jones

Adverts for Virgin Media misled customers by not including the fact that the monthly cost of two broadband packages could increase.

The Advertising Standards Authority (ASA) investigated two ads for Virgin Media packages that appeared on the provider’s own website.

One offered a £50 reward to customers signing up to 50Mbps broadband and calls priced at £4 a month for six months then £17.50 a month, plus line rental.

The other advertised the ‘Big Bang’ package, which includes six months of free Netflix, at £25 a month for 12 months then £32 a month, and £16.99 line rental.

Two people complained to the ASA that the prices being advertised were misleading as their monthly charges had been increased during the minimum terms of their contracts.

The ASA said there are three main types of contracts in telecoms packages – fixed, tiered and variable.

“In a fixed contract, consumers paid one fixed price throughout the contract period,” said the advertising watchdog.

“In a tiered contract, consumers agreed to pay different prices at different times.

“In a variable contract, consumers agreed to pay a core subscription price for the fixed term of the contract (notwithstanding any ‘special introductory prices’), but the provider reserved the right to increase the price at its discretion.”

'Minimum term'

It said it understood the contracts being offered in the two Virgin Media ads to be variable ones that included special introductory price periods.

However, the ASA said consumers were likely to assume the price of a broadband package was fixed unless it was made clear to them that this was not the case.

The advertising watchdog said the ads must not appear again in their current form and that Virgin must state “clearly and prominently” when a contract is variable.

“We also told them not to suggest that a price would be fixed for the minimum term of the contract, or for a certain period of time, if that was not the case.”

Ofcom guidance that came into effect in January 2014 says providers must give customers at least one month’s written notice, and the right to terminate their contract without penalty, before increasing a monthly subscription price.

Virgin told the ASA that promotional and subsequent standard prices are made clear to customers signing up to 12 or 18-month contracts.

It also said it did not know if, when or by how much a customer’s monthly cost may rise at the start of the contract and so it could not advertise future prices.

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