Are Some Broadband Service Providers Ripping Off Their Customers?

by | Oct 12, 2020 | Technology Featured

Many broadband service providers are ripping off their customers with their service bills, even though many other providers are finding means to make theirs more affordable.

Although loyalty to a brand or company is a good thing, it may not be so all the time. Most consumers are committed to their broadband service providers because they have nowhere else to go. You would be right to see it as a penalty for being loyal to a provider who charges for slow internet service.

The CAB Investigations

The UK Citizens Advice Bureau (CAB) started investigating service rip-offs as early as 2002 and raised its first complaint with regulators. This situation led to some changes, as it triggered large sums of consumer pay-outs.

However, the fundamental problem of overcharging consumers for broadband and other essential services is unfortunately becoming the business model of most service providers.

Over the years, consumers have only seen slow improvements, with the energy sector being one of the worst offenders, making huge profits from inadequate service provisions. Firms and service providers can also design contracts that minimise their costs but financially drain their customers.

Unfortunately, consumers are supposed to rely on regulators and place their trust in firms’ reasonableness to make markets work, only to be let down.

How to Avoid and Escape Overcharging

How can you be sure that your provider does not secretly overcharge you? Before settling on any broadband service provider, take time to find out the options available to you. Spend enough time shopping for deals to have an idea of the existing packages from other services providers. Doing this would ensure that you pick the best for you.

Although this might sound pretty obvious, most people do not do so. This could be because they rely on testimonials of other users or have a preference they are sticking by- a preferred bias. Most consumers are quick to apply their own rules of thumb without taking time to first go through all their available options, which most people consider to be too much work.

Secondly, compare the costs of each service provider’s deal, and go a step further to compare and contrast analysis of each deal. Pay attention to the previous prices and the current increments. When you see a significant increment from one provider compared to the rest, they are likely overcharging.

Many people often realise that they are being overcharged after making inquiries from a friend who pays much less for a similar service. Some also find out by reading about it in the news or online reviews, which may be too late.

The Way Forward

Those in the know may even end up benefiting directly from the so-called penalties imposed on loyal customers. The reason is that many broadband service providers offer their new joiners lower attractive or ‘teaser’ rates on their basic broadband packages.

If the savvy customers have more numbers, for example, with bank overdraft charges, there will be little political pressure to correct the system.

The tide seems to be turning slowly, as more people realise they are being overcharged. This would cause a broader push for some form of essential universal services, although it may take quite a while.

However, regulators have a role to play in enforcing the law on broadband service providers. By implementing the existing laws, a customer can rely on proper channels to make complaints and hold a service provider liable for their wrongs against them. This is a task for the Financial Conduct Authority – the UK regulator that oversees thousands of financial markets and financial service firms. It aims at promoting financial and regulatory innovation.

For now, every broadband service consumer should make it a point to check what they are paying for regularly. If you have any reason to believe that you are being charged much for the kind of service you are receiving, do not hesitate to ditch your service provider for a different one.

And speaking of a different service provider, it is essential to reiterate that before you sign up with a particular broadband service provider, take your time to scan the market and compare the current prices with the services available. You can read online reviews or speak to other users to get an idea of how much they are paying.

Remember, you do not have to stay loyal if you do not have a reason to – it is much more comfortable to leave an untrustworthy service provider than to stay to endure the consequences.

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