EU cracks down on mobile contracts
The EU has passed legislation that bans the sale of 36 month mobile phone contracts and ordered providers to offer 12 month deals.
Passed on May st the ruling prevents mobile customers becoming stuck in lengthy contracts and has also seen the number of annual contracts increase dramatically.
In February there were only 279 12 month deals available, but that number has now risen to 4,765 following the introduction of the EU legislation.
However, in cutting these longer contracts out of the market this has seen the cost of the cheapest monthly plan nearly double from around £5 to £9.
Price comparison site uswitch.com welcomed the EU ruling but points out that in killing off the 36 month plan providers will no longer be able to offset the higher costs of smartphones and this may lead to deals on these devices becoming increasingly expensive.
For example, consumers can get the HTC Desire for free with a £15 a month contract if they sign up for 24 months, but on a 12 month plan this price rockets to £35.
Ernest Doku, technology expert at uSwitch.com, comments: "People need to consider what they want from their phone, how they will use it and ultimately what they can afford. Paying for the handset upfront could be the best way to get a cheap deal, but only for those who can afford it."
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