Tag Archives: contracts

Cancel your cell account? Don’t make me laugh

29 Sep

First published on MyBroadband | 29 September, 2010

One of the dangers of being a parent is being exposed to innumerable children’s TV shows and movies. In Beauty and the Beast there is a line, which I like to ponder on every now and then, where the villain – Gaston – says to his sidekick: “LeFou, I’m afraid I’ve been thinking,” to which Lefou replies: “A dangerous pastime.”

Well, I have been thinking and that is a dangerous pastime.

Mostly I have been thinking about how I am going to lay my grubby hands on a phone to replace my current one, which is over two years old. I can either wait until December for an upgrade, till March to take out a new contract, buy a new phone out of pocket or cancel my contract and start over again.

I am by nature a curious person so I decided to find out what it would cost me to cancel my contract. This is a little exercise that I go through once every two years to confirm to myself that nothing has changed in the cellular service provider industry.

With six months to go I would have to cough up R5 301 to cancel my current contract. The nice man at the contact centre was nice enough to explain how this figure is broken down: R3 051 in rentals up until the end of the contract date and R2 250 for the phone. This is with Altech Autopage Cellular (which has had my account for the past 4 years).

Luckily, I was sitting down at the time. It appears that the strategy is that to charge the customer the full outstanding amount plus almost the full subsidy that was part of the deal 18 months ago.

The problem is that this was all supposed to change ages ago. Icasa issued regulations that were supposed to ban these exploitative behaviours, but then Vodacom threatened to take them to court because the regulations were, admittedly, deeply flawed. Then at the end of last year Icasa issued a draft code of conduct to make sure that service providers behaved themselves. Clearly nothing has happened to get this code of conduct implemented either.

So, even though the service providers have known that the way they do business is not just flawed but wrong (even if it is a good way to squeeze money out of subscribers), for more than two years they have made no effort to change their ways.

They have continued to force people to continue to pay for contracts that they don’t want and don’t need. On top of this, they have made it impossible to cancel a contract (without paying up the remaining money owed in advance). They also charge onerous cancellation fees, in the name of recouping the subsidy that they gave you at the beginning of the contract.

There are any number of gratuitous x-rated descriptions of what these business practises entail but considering that this is a family site I will leave those up to your imagination.

The part of this that makes me really angry is that there are two very simple steps that any service provider could take to show that they are truly customer focussed. One: Allow the customer to cancel a contract at any point in the duration of the contract. Two: Allow them to pay back the subsidy that was used to give them a ‘free’ phone.

These two actions would enable the service providers to keep customers happy, while ensuring that they are not out of pocket from a subsidy point of view.

I would guess that the network operators (who shell out the subsidies and control the contract terms) are completely complicit in this little extortion scheme so this is probably not something that one service provider could do on their own. Still, I don’t see the MDs of any service providers (except maybe Virgin Mobile and they don’t really count) standing up and shouting for consumer rights. They are quite happy to sit back and screw the customer for every cent they can get.

In the end it comes down to one simple fact. Customer service in the cellular industry means keeping the cattle calm and peaceful while they are lead to the slaughterhouse. This is never going to change until Icasa gets off its ass and gets some meaningful regulations implemented.

Until then, keep the mooing down to a minimum because the bosses are trying to sleep on their bed of R200 notes.