Court: Virgin illegally incentives staff to discourage customers from switching

Virgin Media, one of the country’s biggest TV, internet and phone service providers, financially incentivises its agents to successfully “save” customers from switching to other providers, the High Court has found.

Mr Justice Denis McDonald made the comment when he ruled that Virgin was in breach of its EU Universal Service Regulation obligations in how its phone agents dealt with customers seeking to switch.
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he said he would order Virgin to amend its training manuals and provide appropriate training to its agents whereby they would cease “save activity” once customers make it clear that they are intent on cancelling.

I rang up Virgin Media threatening to quit when just out of contract.

Sales agent and I had a five-minute ritual conversation and at the end I got €35 off a month for six months and he got his commission. We both knew exactly what we are at.

I don’t see how this is a bad thing.

Dr Strangelove said:

I don’t see how this is a bad thing

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I also don't understand the fuss here when I saw the reports about this issue yesterday. How on earth is it a surprise or objectionable that a company's staff might be incentivised to retain customers?

ClubMan said:

How on earth is it a surprise or objectionable that a company's staff might be incentivised to retain customers?

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I do as well...as customer retention is the goal of any business. However, in a thread I posted about car insurance and a very high renewal v new business quote for the same policy, you seemed to think it was ok for that industry to penallise loyalty.

If the concept of rewarding loyalty is valid for a communications company, why should it not also be valid an insurance or any company? In general terms, they say it can cost as much as 8 times more to win a new customer as it does to retain one.

Luternau said:

However, in a thread I posted about car insurance and a very high renewal v new business quote for the same policy, you seemed to think it was ok for that industry to penallise loyalty.

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Off topic and I never said that anyway.

ClubMan said:

I also don't understand the fuss here when I saw the reports about this issue yesterday. How on earth is it a surprise or objectionable that a company's staff might be incentivised to retain customers?

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However, he refused to make an order in relation to the “two step approach” sought by ComReg.

Instead, he said he would order Virgin to amend its training manuals and provide appropriate training to its agents whereby they would cease “save activity” once customers make it clear that they are intent on cancelling.

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The point is, they are instructed to cancel the contract and then don't. You are forced to listen to a load of waffle and then "oh I can't cancel the contract, let me pass you on to the "loyalty" team, for another blah blah blah". "Its our procedure". The context is, there is no alternative method of cancelling, you have to call them (Sky do this if I remember correctly). There is no button on the website, that you should be able to click, such as "in order to cancel your contract in 30 days, click here".

They are making it difficult to leave. Like leaving a gym subscription. People on here argued this horse trading they do is only for a handful of customers. Well now we know it's almost 200k of phone calls. It should be as easy to leave as join and it isn't. They are not rewarding loyalty, as you don't get the best deal unless you leave. Obviously this helps with retention based on their stats. But its anti consumer. Even if people think anything goes in business and to make a buck.

Meanwhile, we've hundreds, if not thousands, of criminals, walking the streets unpunished, despite multiple convictions... this country

AlbacoreA said:

They are making it difficult to leave.

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Just write them a two-line letter and cancel the direct debit if you don’t want to be talked out of it. Or just call them up and say you’re emigrating and no longer need any broadband provider.

Every time that I cancelled (every year for the past few years) I just told them not to make me any offers and not to put me on to anyone else and not to call me back again - just to accept my 30 days notice there and then and thereafter to terminate the contract/service. And that's what they did. The funny thing is that I was only doing this in order to immediately sign back up with them as a new customer to get the new customer offers because they were the only practical fast internet provider option in my area up to about a year ago.

Dr Strangelove said:

write them a two-line letter

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ClubMan said:

Every time that I cancelled (every year for the past few years)

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Both those things are ridiculous for a internet service provider.

Regardless of anecdotal stores there are a wealth of complaints being reported.

I had an interesting experience with this company in 2020.
I signed up for an all in €10 per month phone offer for 3 months. After this it would go up to €25, I think.
As per their T&Cs I e-mailed a 30 day notice and got response from which I quote
'We're sorry you want to cancel your Virgin Media Services. We're getting in touch to confirm we'll have your cancellation
scheduled for 30 days from the date of this e-mail'

Then the fun started. My next bill totally ignored my cancellation instruction.
On a susequent webchat I was told, among other things, that the e-mails were invalid!
I finished this with ' I believe the e-mails are indeed valid! Please send on corrected final bill which I estimate to be less than €2.
I will be happy to pay this immediately '
I now of course cancelled the direct debit.

The bills continued on my account up to a final balance of €52.50.
I then received a letter saying my service has been disconnected and if the above balance was not cleared, it was their policy to pass on my details to a debt collection agency.
I wrote back and finished by again requesting they send the correct final bill of less than €2 to close the matter.
I got no response to this, but subsequently the balance on my account went to zero!

I dont think I'll be in a hurry to use Virgin again, but I once swore I'd never touch Eircom again.
I'm paying 48 €7.99 per month. Maybe if Virgin offered €6.99??!

The issue here is that, regardless of the logic or commonsense that many of us see in any commercial entity trying to retain its customer base, the EU in its great wisdom has introduced a regulation* that every commercial concern in the Union is obliged to abide by, and one that ComReg (if it is minded to) and the judiciary must enforce.

* Under Article 25(6)(b) of Universal Service Regulations, a provider is required, without prejudice to any minimum contractual period which may apply, to ensure that conditions and procedures for contract termination do not act as a disincentive to a consumer changing service provider.

I would like to see Virgin appealing and winning, but it would probably cost them too much and the chances of winning might not be very high, given our judiciary's craven approach to the Almighty EU. (personal opinion).

(I'm currently half-heartedly resisting attempts by my former energy supply company to keep me as a customer - so far, alas, the 'sweeteners' offered to keep me aren't tempting enough!)

Marsupial said:

and one that the CRU (if it is minded to) and the judiciary must enforce

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What has the CRU got to do with Virgin Media or other telecoms/broadband providers?

Marsupial said:

to ensure that conditions and procedures for contract termination do not act as a disincentive to a consumer changing service provider.

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I think the purpose of this law is around deliberate hurdles like insisting people have to terminate by registered letter or return their equipment to a depot an hour’s drive away. What Virgin are doing is, well, disincentivising switching by offering a lower price which is very different!

Btw in a lot of the EU the minimum contract period is the 24 month maximum allowed by EU legislation and quite strictly enforced by providers.

ClubMan said:

What has the CRU got to do with Virgin Media or other telecoms/broadband providers?

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A valid question and one that frequently keeps me awake at night.

The answer - as should have been obvious to a highly intelligent contributor like you - is that I confused ComReg with the CRU!

Marsupial said:

The answer - as should have been obvious to a highly intelligent contributor like you - is that I confused ComReg with the CRU!

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Thanks for the compliment but it wasn't obvious - especially since you also said this:

Marsupial said:

(I'm currently resisting attempts by my former energy supply company to keep me as a customer - but so far the 'sweeteners' offered aren't tempting enough!)

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Hence my question.

ClubMan said:

Thanks for the compliment but it wasn't obvious - especially since you also said this:...

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The reason for my reference to my former energy company trying to discourage me from switching is that both Virgin and it are subject to the same EU regulation.

Itchy said:

The context is, there is no alternative method of cancelling, you have to call them

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You can just email cancel@virginmedia.ie

I haven't tried in a while but they used to offer different options but then refer you a letter or a phone call. The letter took ages to process pushing you into another 30 days and it used to take days to get them on the phone and you'd have no record.

It was too consistent to be ineptness.

I know people think they get a deal. But it's usually still not as good as a new customer can get. It's turkeys voting for Xmas admiring those kinds practises.