Advanced Television

Ofcom probes Virgin Media consumer contracts

July 13, 2023

By Colin Mann

UK comms regulator Ofcom has opened an investigation into UK operator Virgin Media following complaints from customers that the company is making it difficult for them to cancel their services.

According to Ofcom, being able to switch provider easily is an important part of a competitive market. Telecoms customers can choose from a wide range of providers, services and packages, and can often save hundreds of pounds by switching to a new deal. This ability for customers to shop around, switch and save is particularly important given the current cost-of-living crisis facing UK households.

Ofcom’s rules – known as General Conditions – are clear that the conditions or procedures telecoms providers have in place must not act as a disincentive for customers who wish to cancel their contract.

Ofcom is concerned about the number of complaints it has received from Virgin Media customers who have tried to leave, but said the company had made it difficult. Some struggled to get through to an agent on the phone. Some found their call was dropped mid-way through or they were put on hold for long periods. And many said they had to make lengthy and repeated requests to cancel, as their initial instruction was not actioned.

As well as probing whether Virgin Media has complied with its contract termination rules, Ofcom’s investigation will also look at whether it has failed to meet our requirements on complaints handling. This will include whether customers were appropriately informed of their right to escalate their complaint to an independent ombudsman.

Ofcom says it will gather further information and provide updates as the investigation progresses. If it finds that Virgin Media has breached its rules, it has the power to issue a fine and direct the company to take remedial action or change its procedures, where appropriate.

Supporting customers through the cost-of-living crisis

Separately, Ofcom has published an update on its action plan to support telecoms customers through the cost-of-living crisis.

This includes renewed pressure on the major telecoms providers from Ofcom’s Chief Executive, Dame Melanie Dawes, who – in a letter to their chief executives  – calls for immediate action from them on social tariffs.

Social tariffs are cheaper broadband and phone packages for people claiming Universal Credit, Pension Credit and some other benefits. Dawes urges providers who have yet to introduce a social tariff to do so as soon as possible and, for those providers that do offer them, to step up their efforts to raise awareness – for example, through social media campaigns.

Ofcom is summoning representatives from the providers to update on the progress they are making, and will, for the first time, publish take-up of social tariffs by provider in its annual pricing trends report, scheduled for later in 2023.

Ofcom’s cost-of-living action plan update also includes preliminary research findings into customers’ awareness and understanding of inflation-linked in-contract price rises. By December 2023, Ofcom will publish the findings of its review of inflation-linked price rise terms, alongside further research on customers’ experiences, and seek views on whether it needs to change its rules.

Other Ofcom work to support customers to be completed in 2023 includes:

  • October 2023: publishing its conclusions under our enforcement programme examining whether phone and broadband providers made price rise terms sufficiently clear to consumers at the time they entered into their contract, between March 2021 and June 2022; and
  • December 2023: concluding its investigation into BT’s compliance with its obligation to provide customers with contract information and a contract summary before they enter into a binding contract.

“Our rules are there to protect people and make sure consumers can take advantage of cheaper deals that are on offer,” explains Dawes. “That’s particularly important at the moment as households look for ways to keep their bills down. We’re taking action today, on behalf of Virgin Media’s customers, to investigate whether the company is putting unnecessary barriers in the way of those who want to switch away.”

“We’re also expecting more from the industry as a whole in helping to support customers through the cost-of-living crisis. That means no more excuses when it comes to offering and promoting social tariffs to eligible customers who could switch and save today.”

A Virgin Media spokesperson said: “We are committed to providing our customers with excellent service, supporting them with any issues and giving clear options should they wish to leave. Complaint rates relating to ‘difficulties leaving’ have halved over the past year, showing the progress we’re making, and we will keep working with Ofcom throughout its investigation, while making further improvements in how we handle customer complaints to provide a better overall experience.”

Alex Tofts, broadband expert at Broadband Genie, commented: “Bad things come in threes – and following hefty mid-contract price rises and a string of embarrassing outages, Virgin Media is now facing down the barrel of an Ofcom probe.

“Any allegation that Virgin is making it tough for customers to cancel its services is a very bad look for the UK’s third-biggest broadband provider, particularly in the midst of a bitter cost-of-living crisis.

“With its focus on high-speed fibre broadband, Virgin Media packages are among the most expensive on the market and, as households look to trim their bills, the company is likely to be at greater risk from consumers wanting to downsize than many rivals.

“Regular cases of broadband outages involving Virgin Media this year are also likely to have boosted complaints and requests to cancel.

“Customer retention is likely to be the provider’s top priority, but there is never an excuse for any lapses in service. Latest figures on call handling showed that Virgin Media customers still had to wait longer than the industry average. Their website’s help section on billing and payments is also tough to navigate with no live chat or phone number.

“If Ofcom’s investigation finds the company in breach of its rules the damage to its reputation is likely to far outweigh any fine.
“Hopefully when the long-awaited One Touch Switch process is launched later in the year it will mean an end to out-of-contract customers having to announce their intention to leave their current provider before moving to a new one. In the meantime, any Virgin Media customers wanting to cancel should persevere and make sure they don’t overpay by staying on a rolling deal.”



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