Providers slash broadband and phone contract termination charges

Telecom watchdog, Ofcom announces that major UK broadband providers – BT, Talk Talk and Virgin Media have agreed to receive just a third of their existing, early contract termination fee from their customers who quit their broadband and home phone service before contract expiry.

Talk Talk was the first ISP to cut the cancellation charges on June 1, while other two providers will introduce the new charges in October 2010.

Ofcom announced yesterday that these three broadband suppliers have agreed to reduce the early termination charges by up to 85 percent for the consumers who get broadband and voice calls via landline.

BT which is currently charging £7.50 for each month of the remaining contract, would apply a cancellation fee of around £2.50 to its phone customers from October. Cable internet provider, Virgin Media would cut the charges from £11.99 to £4, according to Ofcom’s new agreement. Talk Talk has already slashed its service-termination fee to £3 from £14.

As for the customers who have signed up for the broadband and phone bundles, they would pay a maximum cancellation fee of up to £9 for each month of the remaining contract.

Ofcom had earlier proposed that the early termination fee should not exceed the cost of remaining contractual payments in case a consumer leaves the service within the minimum contract period.

The new early termination charges would apply only to phone contracts and broadband & phone bundles while pay TV, mobile phone and standalone broadband contracts are yet to be reviewed by the Telecom regulator.

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