An investigation by Ofcom has found that Sky may have breached consumer protection rules by failing to issue end of contract notifications to millions of TV subscribers.
The telecoms regulator launched an investigation into the matter in December. On Friday, it preliminarily concluded that there are “reasonable grounds to believe” Sky is in breach of rules designed to protect customers from costly out-of-contract charges.
Since February 2020, broadband, pay-TV, landline and mobile customers are required to contact customers 10 to 40 days before the end of their contracts. This contact, which can be delivered over text, email or letter, must inform customers of their contract end date, the price paid before that date, any changes to the price or service after that date, the notice period required to terminate the service and the best deals the provider currently offers.
These end of contract notifications (ECNs) are designed to tackle the loyalty penalty longtime customers pay for their telecoms services, with bills rising steeply after their contracts lapse, and encourage customers to switch to cheaper deals.
An 2019 investigation by Which? found that Sky broadband and TV customers faced the steepest post-contract price hikes. Customers with bundles were penalised up to £690 per year for remaining with the provider.
While Sky has been issuing end of contract notifications to its broadband, landline and mobile customers, it has disputed whether the rules apply to its TV services.
Ofcom’s regulations state that the requirement applies to all public electronic communication services. The regulator contends that Sky’s pay-TV service, transmitted via satellite, is one such service.
Sky has disputed this, arguing that its pay-TV is a content and broadcast service, not an electronic communications service. It argues that it therefore shouldn’t have to issue end of contract notifications to its 12.7 million pay-TV customers.
Ofcom has now slapped this argument down. It said in a statement: “We have provisionally found that as a provider of pay TV services transmitted by means of satellite distribution network, Sky provides an electronic communications service. As such, we provisionally consider that Sky is a Regulated Provider within the meaning of GC C1.10 and is required to comply with that condition in respect of its pay TV services.”
Ofcom will now give Sky time to respond to the findings and will reach a final decision by the summer.
In the meantime, Sky TV customers who are out of contract can leave the service at any time, with 31 days’ notice but without paying exit fees, if they find a better deal elsewhere. They can also renegotiate with Sky, entering a new contract with better pricing.
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