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TalkTalk blames Covid for breaking fixed price promise

Emma Lunn
Written By:
Emma Lunn

TalkTalk has had its knuckles wrapped by the advertising watchdog after it used increased broadband usage during lockdown as an excuse to hike prices on ‘fixed’ contracts.

The Advertising Standards Authority (ASA) has banned two TalkTalk TV and email adverts which pledged ‘no mid-contract rises’ after TalkTalk later increased the price on the deals in question.

The TalkTalk TV advert was broadcast in March 2020. It stated: “TalkTalk Faster Fibre is just £22.95 a month for 24 months, fixed until 2022”. The claim was also repeated on screen.

An email advert, received on 17 January 2020, stated: “Fix your broadband price at £17.95 for the next 24 months … No mid-contract rises on your Fixed Price Plan …”

Nine TalkTalk customers who were affected by the price hikes complained to the ASA. They challenged whether the claims in TalkTalk’s adverts were misleading.

Several customers also took to social media to complain about the price rises, prompting the ASA to investigate the claims.

TalkTalk said it had launched fixed price plans in 2016, in which customers were offered a fixed price for their minimum contract term. It said the price could be changed in accordance with its terms and conditions, which included being able to up prices ‘for legal, regulatory or business reasons’.

TalkTalk claimed the coronavirus lockdown could be classed as ‘exceptional circumstances’. It said the fixed price was for ‘reasonable and normal usage’ of broadband but usage increased when lockdown meant many people were working from home, home-schooling children, and using the internet to keep in touch.

TalkTalk said usage of its broadband network increased significantly during lockdown and that it ‘did not believe that consumers expected to pay a fixed price for the level of usage seen during the lockdowns’.

However, the ASA disagreed and upheld the complaints. It said that a fixed monthly price was likely to be material when consumers where choosing a broadband package and that consumers were likely to understand from the ads that the price of their plans would be fixed for the duration of their contract.

In considering the case, the advertising watchdog referred to Ofcom guidance on mid-contract price rises. The regulator’s guidelines made it clear that if a telecoms firm wanted to increase the monthly price agreed by the customer at the point of sale, Ofcom was likely to regard it as a ‘materially detrimental contract change’ requiring the customer to be given at least one month’s written notice of the increase and the right to terminate their contract without penalty.

The ASA said the adverts in question were misleading and banned them from appearing again. It told TalkTalk to not claim prices were fixed if prices could increase mid-contract.