O2's Upgrade Scandal

[Anonymous]

Let me start from the beginning again . My wife took out an iPhone 3G contract with O2 last year, which was for a year and the tarif about £35pcm. Soon after we visited the O2 shop in our area to upgrade my contract and my wife was advised by the sales assistant that she should change her contract, which was a personal/residential contract to a business contract, paying a higher tarif which is about £50 and the contract would be for 2 years as opposed to her yearly contract, but would get a free upgrade after the first year.
When her first year of the contract was completed, my wife went back to the O2 shop to ask for her upgrade and was told that O2 had changed the terms of her contract and she would have to pay £150 for an upgrade to an iPhone4. There was no option of a 3Gs. Of course my wife complained, but the O2 sales assistant said that she would have to call customer services and remarked that if she was a customer she would complain also.
Having spent several hours in total, speaking with a number of different people at O2's customer service, my wife was told that O2 had changed 'legally' its terms and that again, my wife would have to pay £150 to upgrade to an iPhone4. I must point out, that generally, the people in customer services proved to be rude and aggressive, adopting an attitude of 'there's nothing you can do about it, so go away'.
In addition to phoning customer services, my wife also registered her complaint via O2's online email form, to which replies were to phone customer services upgrade team, which she had already spoken to. When this was pointed out via email, my wife was again instructed to call O2's retention team, given the same phone number. Each time my wife was told the same story that O2 has changed its terms and that my wife would have to pay £150 to upgrade to an iPhone4. It was also pointed out that the definition of an upgrade in her contract didn't necessarily mean an iPhone upgrade, but could be anything else that O2 deemed to be an upgrade. The last call to the retention team, which is customer service, the guy was adamant that my wife would only get an upgrade if she paid £150 and said that he would get a manager to call her back the next day. Of course this didn't happen.
A good friend of mine, who got the same business contract around the same time as my wife, had the same problem, but capitulated when O2 offered her an upgrade to an iPhone4 for £110. In addition, O2 are offering on their website an iPhone4 for a tariff of £47pcm for a payment of £38.99 and a free iphone4 for a tariff of £63pcm. So, why is my wife paying over £50pcm for an iPhone3g and can only upgrade to an iPhone4 for a payment of £150, apart from the fact she was told it would be a free upgrade? O2 will probably say it's because my wife is on a business contract, but I would say she was mis-sold the business contract as O2 are now not honouring it. Why would she change her original contract from a residential contract to a business contract, paying a higher tariff for the same phone, if an upgrade was not part of the deal?!
In addition to the above, my wife has also wrote a letter to O2, but has not received a reply.
My wife has not received any notice to the changes made by O2 to her contract, or indeed agreed to any changes.

[Anonymous]

For me this issue comes down to two key factors:
- A 'free mid term' upgrade. I'd be sceptical without having it in writing of such a concept. Why would O2 (or any company) provide you with another handset (let alone a similar or upgraded model) free of charge half-way through an existing contract? Why not just half the length of the contract if that were the case?? I understand your rationale is that you've been advised (or misadvised) this, but over the years looking out for deals I've not really heard of such a scheme - by yours and others comments it appears to have existed in 'some form' but it seems a bit too good to be true .
- Ultimately you've been advised something which the sales rep has later reigned on or not been able to provide. This is not on from a CS point of view and if the rep admits to advising this to you as you state (however misguided), they should do the decent thing and honour it.

[adamtemp64]

Thank you Ninzah.
I'm wondering how many O2 employee's are members of this blog?

Officially only ones that say site admin and usernames also end in @o2
These forums are called customer forums for a reason.
As a business customer we had the mid term upgrade and it used to allow for a new handset at the price stated for a new 24 month contract but if you signed at exact month 12 end just continued to the end of original contract term i.e. 24 months from original date of signing if upgrading in month 13 14 etc you commited to 12 months from date of taking midterm upgrade not a fresh 24 months several threads about this in the business section.
That is what happend in the past under old t&c.
But as of march this year that option was removed so I am not sure if now it is 24 months as the old existing contracts are no longer available so you would be signing a new set of t&c.
Just my take

[Anonymous]

Thanks Liquid and Adam.
I have myself with another provider had free mid-term upgrades. I have not looked at the other providers recently to see if this is still the case. At the point when my wife changed her contract, iphones were exclusive to O2. However, this has changed. I wonder if this has something to do with it? We don't know what kind of deals Providers have with Mobile manufacturers, but as Liquid points out, whether or not it is viable for a provider to hand out free mid-term upgrades, the fact is my wife was sold this contract on that basis and the decent thing would be to honour it.
So are you saying Adam, that if paying for an upgrade now, O2 cannot extend the contract? Yes the terms were changed, but doesn't apply to my wife's contract as it was taken out last year.

[adamtemp64]

You would have to check the exact t&c but at any upgrade you agree the new t&c in force at the time

[Anonymous]

If I can clarify a few things here:
I don't see how a sales rep can guarantee that in a year's time any phone brought out will automatically be free. Where the misunderstanding happens is that O2 staff may use the term free as in you don't have to pay for the right to take the upgrade, whereas on consumer tariffs you'd have to buy yourself out of the contract first, then potentially pay for the upgrade.
Business terms changed earlier this year where customers who started their contract after 15/2/2010 would have to start a new 24 month contract when they took a mid term upgrade. On that new 24 month contract there is no right to a mid term upgrade.
When you start the contract you agree to the terms of that contract, however O2 can change the terms of the contract at any time and have to provide at least 30 days notice of this. This is generally done on their website, it's not normally done by a direct communication to each affected customer. As O2 are putting this information on the website, where the public can access it, it's perfectly legal to do this, as I understand.
Hope this clears it up a little. Obviously from your point of view it doesn't help much as you're ultimately not getting what you thought you were promised, and O2's stock responses clearly haven't helped. It is an abrupt change that has caught a number of customers (and O2 staff) out.

[Anonymous]

The point still stands that there will be a phone (possibly a few you can choose from) you can get as a free upgrade, it just doesn't happen to be the one you want. So, the one you want is being offered to you at a subsidised price.
I still cannot understand why anyone would believe a free upgrade would be to any phone they wish. Clearly, some phones are worth considerably more than others.

[Anonymous]

£504.99 for an iPhone 4 16gb = £42.83 a month just to pay off the phone over 12 months. How much is your tariff?

[Anonymous]

Thank you Southerner.
Of course a sales rep can not guarantee anything, but they are selling a product based on information given to them in order to sell the product. I don't believe O2 sales rep's are making up their own sales pitch. The term free may very well be mis-used by sales reps, which creates misunderstanding and effectively mis-selling of their product. As I have mentioned above, at no point was it mentioned that there would be an additional cost for the upgrade, or that in addition, the contract would be extended. It was clearly stated that it would be a free upgrade only.
With reference to O2's Executive Relations above, the recent changes to O2's terms do not apply to contracts taken out before March of this year. So the changes do not apply to my wife's contract. However, according to Ofcom, companies are supposed to notify customers directly of changes to their terms.

[Anonymous]

Ninzah. Please read my reply to your previous comments.
Hi Revsak. About £50pcm. However cost of an iPhone 4 to me or you would be around £500, but I don't believe O2 are paying anything close to that, otherwise they, or any other provider, wouldn't be giving them for free to even new customers. In addition, to the tariff, customers are also paying additional costs for bolt-ons, calls and txt outside of their allowance, international roaming etc. My wife's last bill was £76.

[Anonymous]

Ninzah. Please read my reply to your previous comments.

If you choose not to look at the issue as a whole then that's up to you, however my point still stands.
The free upgrade is available, it simply isn't the phone you want. So, the phone you want is being offered at a subsidised cost.
Would you rather the free upgrade was simply a case of you get phone X for free, regardless of whether it's the one you want? With no opportunity to choose a different phone for a small additional fee?
I cannot imagine that your contract states a free upgrade to any phone you like.
You don't like the facts, fine, but it doesn't stop them from being facts.