I have recently treated myself to an iPhone 4S on a monthly contract after years of using older, less flashy phones through pay-as-you-go.
While I’m very excited to finally have a phone that does more than simply call and text, I’m terrified of actually using it to do anything that involves being online, in case I rack up a huge bill. I have no idea how much, say, watching a video on YouTube will end up costing me.
Is there any advice you can give me so I can make sure I don’t inadvertently land myself with a massive mobile bill?
Christa Sten, via email on Wednesday 14 March, 2012
Thanks for getting in touch, Christa.
Mobile users being hit with unexpectedly high phone bills by unwittingly clocking up charges for voice and internet services is far from uncommon - in the mobile industry this is known as “bill shock”.
It’s also far from uncommon for bill shock to be a worry for those on a pay-monthly mobile contract - research recently published by Ofcom, the communications regulator, found that 1.4 million people on contracts have been hit by bill shock in the last six months.
It can seem like there are many, many ways that you can accidentally build up a phone bill that makes the new Wembley look like value for money, but these all generally stem from one of three main causes. These are:
1. Downloading data - Or accessing the internet on your mobile phone as it’s more commonly known. This often catches people out when using their phone to go online while travelling outside the EU, which is often far more expensive than it is within the more regulated confines of the 27 EU member states. This is not to say data-related bill shock is only likely while you’re on your jollies - it often occurs because people’s smartphones are downloading data without them realising it (for example, via an app that periodically accesses the web) or because they simply have no idea how much data they are using.
2. Mobile voice services - These suckers can see you handing over your life savings to your mobile network even if you take the most obvious precaution of not using them abroad. Exceeding call allowances included with your contract or calling numbers not covered by these allowances can see you racking up bills like Rangers on a bad day.
3. Lost or stolen phones - This results in bill shock when it is some time until you notice that your smartphone has been swiped or your mobile misplaced, giving the miscreant that swiped or found it carte blanche to call everyone in the southern hemisphere while downloading the entire recorded works of Frank Zappa. While the number of people affected by this type of bill shock is relatively small, in the words of Ofcom “the level of financial harm can be substantial”.
At present you will usually be liable for any costs incurred on your mobile contract regardless of the circumstances. Mobile networks will sometime to step in to help out a customer who has unwittingly landed themselves with a bill that’s thicker than the Bible, but usually they are not obligated to help.
Whatever the circumstances though, it is usually a good idea to get to know the ins and outs of your contract before you start downloading The Lord of the Rings film trilogy in high-definition while you’re holidaying in El Salvador.
And the regulator clearly means business - it has said that if the measures produced in partnership with the networks don’t go far enough in reducing the impact of bill shock on customers, it may introduce compulsory rules.
Ofcom has also asked the networks to do more to educate their customers about how to avoid bill shock.
Extending EU roaming regulation - As mentioned earlier, using your phone abroad is often a catalyst for bill shock. At present, the EU Roaming Regulation requires all mobile networks to cut you off once your mobile internet bill hits around £42 per month while travelling in the EU, while also sending you warnings when you reach 80% and 100% of that limit. Ofcom is backing the Body of European Regulators for Electronic Communications (BEREC) to extend this to cover European mobile users wherever they are in the world.
Ofcom is also urging mobile networks to introduce their own mobile internet caps and usage alerts in advance of the extension possibly coming into force in June this year. The cost of accessing the mobile internet in the EU is also expected to “fall significantly” by 2014, meaning that users will get a lot more access for their money before reaching the EU bill limit.
Encouraging mobile networks to set financial caps - As well as asking mobile networks to help you avoid roaming costs, Ofcom also wants them to help you control the amount you spend using your mobile in the UK. Networks have been asked to develop contracts that allow you to set your own spending limits and incorporate alerts and tools to monitor usage.
Maximum liability limits for a lost/stolen phone - Ofcom wants mobile networks to look at how they monitor unusual and fraudulent activity on customers contracts and examine the possibility of limiting the amount you’d be liable for if someone ran up a huge bill on your mobile after it was lost or stolen. The networks are also being asked to do more to educate users of how they can help stop this from happening, such as locking their handsets.
Making mobile contracts more transparent - While mobile networks offer a wide range of deals to give you as much choice and flexibility as possible, Ofcom’s bill shock review found some of us are having trouble finding out how much using everything we’re being offered will actually end up costing us, or, when we do find out, are actually being given incorrect information.
As such, Ofcom has reminded the mobile networks that they are obligated to make information on their contracts available to customers, including on their websites, under its rules, and that they should not be indulging in any shifty business. The networks are also required to tell us when they make any changes to our contracts. Ofcom is reviewing the information supplied on the networks’ websites as well as monitoring complaints about mobile data mis-selling.
There are many things you can do that will lead you to being landed with a mobile bill big enough to beat a whale to death with. Luckily for you then that Mobilechoices.co.uk is here to help stop you from getting slapped with an unexpectedly big one .