2018-05-07

Discounts and surcharges

One of the things that apparently confuse people, it seems, if that whenever you see a discount you have to see the flip side, that the un-discounted amount is much like a surcharge.

For example, I just saw this on facebook (with someone making the same point).

Yes, it says "free delivery" but a discount of 10% for collection.

I.e. the pricing clearly allows them to sell (food I think) for the discount price, so the extra 11% on top of that is a surcharge for deliveries.

That is very much not "free delivery", is it!

The trick is to always look at the other side of things.

Let's look at BT!

Now, BT have finally launched the rather odd lower price line rental for people with no broadband. It is described here. It is quite a lot cheaper than normal, £7/month off.

But let's look at this the other way around. What it is, in fact, can been seen as a £7/month surcharge if you get broadband. Even with another supplier than BT for the broadband.

How the hell has OFCOM allowed this basically anti-competitive behaviour - how are they allowed to link their price to competing providers independent services? Well, OFCOM actually encouraged and/or mandated this crazy scheme.

Interesting, broadband via your mobile does not impact the line rental. But on face value, broadband via cable, wifi, or other means would impact the price. It just says "Broadband with another supplier" is not allowed (but says mobile is OK). They actually say broadband via Virgin means you DO NOT get the discount. So this is nothing to do with the line being shared access to the copper or anything like that, it is simply a surcharge for taking a broadband service!

I am surprised it is even legal for this sort of linking of price to independent services from other providers. I cannot help feeling it should not be legal. It would be like us giving a discount on broadband if you use Daz washing powder.

However...

I have not found the formal contract terms - it used to be easy, so if someone finds them, let me know. But that web page is very clear about you having broadband - so presumably if your spouse, parent, child, friend, etc, has broadband installed at your house then the discount still applies (or rather the surcharge does not apply)?

Maybe two neighbours can install broadband for each other, and just use the wifi through the wall :-)

Ideally it means checking the exact terms to be sure.

P.S. Just to clarify, the discounted price is £11.99 from BT. A&A do a "line for broadband use" for £10 (no calls allowed) which obviously applies with having the broadband (only available with broadband).

12 comments:

  1. This is the way all discounts and sales are done though.. it's 'you are saving X' rather than 'you are avoiding paying the surcharge for not doing X' - whether that's bulk buying, buying at the wrong time of the year, buying online, etc.

    Coca Cola tried to do it the other way around once.. they made vending machines that put the price up on hot days. It was *not* popular. If they'd simply increased the price and made them cheaper on cold days, nobody would have even noticed.

    ReplyDelete
  2. > It would be like us giving a discount on broadband if you use Daz washing powder.

    Is BT not a special case and that, in principle, leaving aside discrimination on the grounds of protected characteristics or compulsory unnecessary sharing of personal data, a retailer should be able to price their wares as and how they wish?

    ReplyDelete
    Replies
    1. Fair point, but it does seem wrong somehow to me.

      Delete
    2. Clever consumers don’t fall for such gimmicks and instead take their trade to retailers that offer a better deal. Frankly I’m amazed that all those big companies that were privatised in the 80s have any customers left.

      Delete
  3. How would BT know if you had broadband from virgin or some other altnet provider. If its on the line then I guess they could use tags bit if it's another network given dpa laws I'm not getting how they would know.

    ReplyDelete
    Replies
    1. No doubt they have some creepy method, big brother always does

      Delete
    2. they do know the isp tag on the line. so they can check. It's drilled into you in training that you are not to reveal that you can see. You just have to say you don't know. This was back in early 2000's using smart and css.

      Delete
    3. Virgin (coax) is not in the same line. So the would not know.

      Delete
    4. They are able to tell if its a BT line or not, therefore by deduction, cable/virgin.

      Delete
    5. Err, no, the copper pair from BT on which you have the lower price telephony would be a "BT line". The bit of coax dug in to the garden, about which BT know nothing, would be Virgin. BT would not know you have Virgin.

      Delete
  4. You can't be discriminated against on the grounds of race, religious belief or lack of it, disability and umpteen other things. But the one thing that's conspicuously not outlawed is 'singleism'. The worst thing that encouraged this was barcoding, because it allowed retailers to bring in notorious offers such as '3 for 2', 'any 3 for £10' etc.

    Compulsory bundling of services, charging more if another service is not taken or a single item is required should simply be banned because they're all anti-competitive practices. Why on earth shouldn't I be able to buy my line rental, broadband and calls from three different providers, choosing whichever is cheapest / fastest / most reliable etc? Ditto gas and electricity, when I buy gas why should I have to buy electricity from the same supplier?

    If we had effective regulators and competition watchdogs none of this would be allowed, but they are all utterly useless. They don't represent the consumer in any way shape or form because they are just far too close to those they are supposed to regulate.

    ReplyDelete
    Replies
    1. Regulators... hah! All I think they do is drink coffee, take flexitime and line their own pension funds at the taxpayer’s expense.

      Delete