Home news Being free wants to be learned | TIME ONLINE

Being free wants to be learned | TIME ONLINE

What is the most important feature of a mobile phone contract? The
      "High-speed data volume", with which advertises the provider so prominently? The beautiful "Allnet-Flat",
      with which one can telephone in all nets as long as one wants? Or the new smartphone,
      that it adds for a tired euro spottgünstig?

No. The real secret of a new mobile phone contract is often hidden behind a small star that is innocent next to the price. Who follows the symbol, gets caught in a small written text of rules and conditions. Among other things, they provide information on how long the new contract will last at least and how hard it will be to terminate.

A good example is the current campaign of the Germans Telekom with the slogan "Be All #Dabei". Who clicks on the star next to the lock price of 19.95 euros for all, learns in the fine print, among other things, that is associated with a minimum contract period of 24 months and prices can rise sharply after a few months. It is the telecom apparently not just about the Dabeisein, but especially to Dabeibleiben.

For the consumers, offers of this kind often turn out to be a cost trap: they remain in the same tariff for years because they shy away from the change or experiencing problems
        (TIME
        No. 12/19)
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Justice Minister Katarina Barley (SPD) has now resolved to eliminate such cost traps in mobile phone and electricity contracts. Among other things, one of the key issues of its ministry stipulates that providers may no longer offer contracts that run for more than a year. If consumers do not cancel such contracts, they can continue to extend automatically – but only for a maximum of three months and not for a whole year. In addition, the notice period should only be a maximum of one month, so far it is often three months. Customers could spontaneously renounce a contract and switch to another provider. That would be good for competition – and therefore for the consumer.

Barley's plans are an overdue step at a time when technology is constantly improving deals and prices have been falling for years. They fit into a time when consumers, thanks to Netflix, Spotify and Co., are used to canceling contracts per month by clicking.

If Barley's proposal becomes law, then consumers need to rethink. The subsidized mobile phone for one euro will probably not exist if the coupled contract may only run for a year – simply because this business model for the providers then less worthwhile. It may also be that the shorter-term contracts will be slightly more expensive than the two-year contracts that have been customary so far. This is shown by the experience with the monthly puttable tariffs, which companies already offer now, without promoting them big; usually they cost a few euros more. But there is no reason to fear that consumers will have to pay more on balance – if they are only willing to take advantage of the new freedom and switch providers faster and more frequently. So you can save money without getting tied up for long; and suppliers will feel pressure to pass on price reductions to existing customers as well. It can be nerve-racking, but it will be worth it.

Especially since the proposals are intended to protect consumers from other costs. For example, in electricity and gas contracts, which they often today be pushed on the phone
        (TIME
        No. 51/18)
, If it goes to Barley, there should be a so-called confirmation solution in the future: Before an agreement on the phone contract is valid, energy providers must obtain a confirmation "in writing" – for example, by mail or SMS. This makes switching a little more complicated, but it is a big step forward for consumers, who can not easily be taken by surprise.

Barley's proposals also encourage consumers to defend themselves when companies violate rules. For example, anyone who is bothered by a company on the phone without having ever agreed to their advertising calls can complain to the Federal Network Agency. In 2018, the agency received 62,000 such complaints – a new high. And apparently a wake-up call for the Minister of Justice: Barley wants companies to prove in the future that a consumer has consented to telephone advertising. This will certainly not stop unauthorized phone calls, but it could reduce them. And it shows: complaining helps!

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