Wednesday 19 December 2018

Charlie Weston: Telecoms companies view loyal customers as mugs who should be bled dry

Just 6pc of people with a landline switched provider last year. Stock image
Just 6pc of people with a landline switched provider last year. Stock image
Charlie Weston

Charlie Weston

One thing we do not suffer from is a lack of competition in the telecoms market. There are around 10 main providers of phone and broadband in this market - and this does not include smaller rural and satellite providers of broadband.

The problem is that people, particularly the elderly, have a tendency to stick with the company they have been with since the house first had a phone installed.

Many of the customers who will now be expected to pay more to Eir have been with the provider since it was called P&T. It has gone through numerous name changes and ownerships since, but large numbers of customers have remained loyal to it.

Just 6pc of people with a landline switched provider last year, according to the Competition and Consumer Protection Commission. Only 14pc of broadband users have moved to another service provider.

Fear of change and inertia combine to stop people switching. This means companies such as Eir have a captive audience.

Customers are vulnerable to price hikes because they will just suck it up and absorb it, instead of moving their business.

Many of those who will be affected are older people, who depend on a landline phone for keeping in contact with family and friends and for operating their alert scheme. These people are the least likely to move provider to nullify any price rise.

They are also already out of pocket from the loss in 2014 of the telephone allowance paid by the Department of Social Protection.

Eir stands accused of compounding this fact, with a second price rise in just over a year.

It now seems every year that telecoms services, such as landline and broadband, go up.

Already in the past year, the big operators - Vodafone, Virgin and Sky - have imposed increases. Now Eir is following up its rise from last year with another this year, at a time when inflation is muted.

The bottom line here is that you are vulnerable if you do not switch.

Loyalty is a mug's game.

Irish Independent

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