marine1
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Question of the Day: How do you normally pay for purchases in stores?
Vodacom, Cell C price hike probe
- Thread starter rpm
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Billions
I think it will end off a war between who's right is more superior if I can put it like that.
It is very hard for anyone to draw a conclusive line between right and wrong in this situation. Let me demonstrate a couple of situations that makes it hard.
*Contract get's advertised on TV for R389 per month. They don't mention anything of a possible annual increase there.
*You call the carrier direct and they sell you the contract and to the application and just do a small summary of terms. No mention of a possible increase there.
*Now the courier delivers your phone and contract with a stack of 15 pages of fine print. How are you going to read through that while the courier waits?
*Two months later the increase comes.
I think this is where the consumer protection act comes in to protect the consumer so the consumer does not get caught in a agreement that might be unfair.
But after all that ICASA made provision for carriers to allow for a increase if it is fair and Vodacom claim the increase to be fair.
So who wins here? Very hard to know what is fair and what is not fair because you can't cancel your contract without incurring penalties. Vodacom feels they can't continue to absorb the financial loss.........
Very complex situation actually and I think it has not happened yet and that is why there is conflicting acts against and for both the consumer and the business.....
If the increase is justified then it is not fair against the consumer because you have no say and MUST pay the increase or pay the penalty to cancel.
If the increase is not justified the Vodacom is in hot water for exploiting a loophole to increase prices.
How one would justify such increase is hard to say because they are a business after all and a business needs to make money and technically they have not done anything wrong but why does the customer have no options too.
For two service providers to be able to justify (even just internally) that they need to make broad price adjustments across their entire customer base there would need to be broad macro economic factors.
It's easy to find a convergence of issues around power security, power costs, labour and exchange rates which all contribute directly to their operating costs. These factors are out of the control of the operators and are largely the responsibly of government policy.
They are quite justified in their actions. They are mostly fair too as they have not singled out and specific customers. I don't see much chance of a legal challenge.
It's easy to find a convergence of issues around power security, power costs, labour and exchange rates which all contribute directly to their operating costs. These factors are out of the control of the operators and are largely the responsibly of government policy.
They are quite justified in their actions. They are mostly fair too as they have not singled out and specific customers. I don't see much chance of a legal challenge.
i have to say i lean towards that angle ambo. remember mtn decided to cut jobs in order to contain costs. and i think they would generally be able to demonstrate how macroeconomic conditions have lead to cost rises. what would be interesting is those cost increases v what they have raised prices by ie is it an unjust increase.
and of course the fact that the legal caluse to raise costs is in the contract.
i really doubt that legally they are on shakey ground. though from a business practice point of view i would certainly say they have done themselves no favours.
one thing i would hope this resolves, is the reasonable cost of exiting a contract.
and of course the fact that the legal caluse to raise costs is in the contract.
i really doubt that legally they are on shakey ground. though from a business practice point of view i would certainly say they have done themselves no favours.
one thing i would hope this resolves, is the reasonable cost of exiting a contract.
As has been pointed out not if it's unfair or one sided and therefor unenforceable. You never answered the question so I will state it here again. What if they decided to increase prices by R1000? Because legally according to you they would still be on solid ground.
The whole distribution channel is a problem. For a phone that's R1000 at retail a retailer still pays R1000 so their profit has to come from either the contract they sell with it or the sim card. Hence prices are basically fixed no matter where you buy. The phone is a pretty big carrot.
Things are slowly changing though with companies like Huawei with their own distributors but it's not enough imho. The rest that have traditionally used service providers like Autopage or Nashua should also switch away from that.
marine1
Honorary Master
Thus is simple to solve. Stop the increase mid contract. But no why should they? This is mafia style business and should be deemed illegal
Gatecrasher
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It might be fair.... if there were any instances of operators reducing existing contract prices for the reverse "reasons"...
Thank you! How come contracts never benefit from price drops but always have to burden increases? It's bullshint!
You got a very good point actually. If the rand strengthens and medupi and kusile come online would they then reduce the price? I highly doubt that so why are there only clause allowing them to increase prices but nothing or no one to make them drop prices when things are going good........
Always? This is the first I know of. It's fair though if they never decrease as long as they never increase.
Based on personal experience, it is entirely possible to buy a high-end phone for a really good price if one shops around.
While Orange ZA has soured and I no longer recommend buying more than one item at a time from OZA, I did get a good deal on a Nexus 5 32GB just as the Rand started taking a nose dive almost a year ago, now the Nexus 5 phones cost even less on OZA.
Before that I bought an S2 cash from a Telkom Direct store at a discounted price back in 2011.
The thing is that people find the contract option far too convenient instead of saving for a new phone and doing a little bit of shopping around.
I don't want to butt into that conversation, however the higher the price increase, the more attractive the contract cancellation fee becomes for consumers. Or put another way, if the cancellation fee is very close to what the price increase amounts to every month, consumers will simply cancel in droves.
My impression is that the cancellation fees that service providers contractually impose when exiting a contract, are quite substantial and are more like a disincentive (to discourage people) instead of a fair and just calculation of what is still owed on the "free" phone/device and revenue that will be lost for the remainder of the contract period.
The contract cancellation fees need to be examined from every angle and any unfairness needs to be repeatedly exposed by the media, this could also start a flood of CPA court cases that service providers have to answer in court.
This would depend on the phone. Manufacturers like Huawei have their local distributors for their products so they simply add their phones to the list. Traditionally though with brands like Nokia which don't have a local presence the price is rather fixed as set by either Nashua or Autopage. It's certainly good we now have brands like Samsung and LG in dominant market positions. My next phone will likely be a Huawei ordered directly from the distributor.
I think the huge problem is they do so unilaterally on a signed contact which is still legally binding. I really do wonder if the contract is breakable with no cost.. I mean why the hell is it acceptable for them to deviate but not the consumer... If u can't pay x pay x-y 
?
I think next contract someone should look for the clause and either cross it out OR add your own clause that says any deviation from prices = cancellation of services but device payment at agreed upon price.. That or start using disposable accounts that you cancel willy nilly. I'd love to see that in court as the sales consultant will rarely pick up on such things and technically it's legal and if they accept it tough ****
? I think next contract someone should look for the clause and either cross it out OR add your own clause that says any deviation from prices = cancellation of services but device payment at agreed upon price.. That or start using disposable accounts that you cancel willy nilly. I'd love to see that in court as the sales consultant will rarely pick up on such things and technically it's legal and if they accept it tough ****
Disposable accounts?
Thing is how do you prove that it was done before signing the contract?