Mobile communications and the Internet: the Germans’ expensive contractual loyalty

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WHow nice it is to be a new customer: 150 euros instant bonus, free router and free months. Fixed line customers can find such offers for telephone and Internet when they switch providers. But mobile customers who want to switch also often receive bonuses and rewards when they sign a contract with the competition.

It is worthwhile to change providers regularly, as consumer advocates do not get tired of recommending. And indeed: It is precisely with such contracts that providers grant their new customers high discounts, confirms Jan Wieseke, Professor of Sales Management at the Ruhr University in Bochum.

“For goods or contracts that are sold in large numbers, there is often a new customer bonus,” says Wieseke. “Because the lure offers bring a lot of customers who in turn generate sales.” Therefore, a termination could be worthwhile for consumers.

Internet, telephone and cell phone prices have fallen

In the first two years of the contract, many prices for the Internet, telephone or mobile phone are discounted, as Arne Düsterhöft knows from the consumer portal “Finanztip”. Only then does it get more expensive.

The calculation behind it: “The providers hope that the customers stay as long as possible because the effort for a change seems too high for them or they have forgotten the contract after two years.”

Anyone who has had their contract for years should definitely take another look at the market. “The prices have fallen significantly with the technical development of the mobile phone network or the contracts offer more performance,” says Düsterhöft and gives an example: Seven years ago, an all-net flat rate in the D-network from Vodafone or Telekom cost an average of 30 euros , such a contract is already available today for 8 euros.

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But if you don’t move, you will continue to pay the old high price. Cancellation and new contracts are very easy, and a lot can be done online with just a few clicks. Each provider must indicate the exact period of notice on the invoice. The consumer advice centers even advise leaving the termination to the new mobile operator.

Just a day and not a day longer

The work involved in landline telephones or the internet is somewhat greater: a technician may have to come there. But not much can happen when you change. The companies are obliged to ensure that the telephone, mobile communications or the Internet are not interrupted for more than a day.

However, this often does not work, as a survey by the Schleswig-Holstein consumer advice center showed in 2019: Almost two thirds of those surveyed reported that their provider had broken the daily deadline when switching.

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That could improve in the future. Since the amendment to the Telecommunications Act, which came into force at the beginning of December 2021, consumers have been entitled to compensation in such cases. The same applies if the number portability does not work right away.

Loyalty is not worthwhile with telephone contracts

“If the change sounds like too much effort to you, you should work out your hourly wage,” says Düsterhöft. “It’s phenomenal. With a single change of contract, you can definitely save 100 to 200 euros. ”And all of that in one fell swoop.

And if you like this view better: In purely mathematical terms, the monthly bill is 4 to 8 euros lower than the non-discounted tariff.

So: Loyalty is not worthwhile with telephone and internet contracts. This is different in other industries, says Prof. Wieseke: “Existing customers have better cards when they meet salespeople, for example in furniture stores or at jewelers. They tend to give loyal customers discounts, because there it pays off over their lifetime if they keep coming back. “

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Nevertheless, even loyal customers should not accept excessively high prices. You have a trump card up your sleeve: the termination – or at least the threat of it.

The providers are often ready to win back their existing customers with discounts in such a case. And since the beginning of December 2021, customers have been able to use this pressure medium at any time.

You can cancel every month

Because after the initially agreed contract period of usually two years, telecommunications contracts can only be extended by one month, as the new Telecommunications Act prescribes. This applies to new contracts, but also to existing contracts.

In addition, the providers are now obliged to inform their existing customers once a year what the optimal tariff is for them, based on the current tariff. This is to prevent existing customers from continuing to stay in expensive tariffs, although the same provider has long since had more favorable conditions and a change would be easily possible.

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