Zen "admin" fee?

My contract just expired for Fibre2 (when did they introduce 12 month contracts?! I thought it was monthly rolling!)

Anyway, I was paying £39pcm including line rental. The website shows the same available now for £35pcm so I asked to be moved to the cheaper deal.

They did it without questioning, but I was charged £10 for the "regrade". What's that all about?! I could have moved to a different provider for free, and saved even more. Not great considering I've been a customer for well over 10 years.

Granted, I'll get that £10 back in saving in the first few months, but what is it actually for? Someone changing my direct debit?!

I dont know about the admin fee but I think they started 12month contracts when they introduced Fibre as BTOR gave them 12Month ones (I think OR have changed that to 6 now but Zen kept the 12)

The "contract" was for a minimum term. IIRC Ofcom now require ISPs to notify customers that they have reached the end of it. Precisely so they know they can move without penalty.

You are correct, you would have been left on a monthly rolling one, but its price with many ISPs would be higher than whatever you were on during the initial one, as those are often at a "reduced" first year price.

Presumably you are now in a new minimum term?

Edited by RobertoS (Tue 14-Jul-20 12:34:13)

Yes, another 12 months. I just don't see why I had to pay the £10!

"Regrade" is a bit of a weasel word if it is the same product and services, including the same underlying wholesale product being resold. Especially if your previous arrangement was for 12 months and the new one is also for 12 months.

The price of the service should include the costs of managing the service and customer relationships because that's part and parcel of their business.
If they want to charge one-off fees for anything else it should be for really changing a setting or adding/removing a feature.

I'd have no problem with needing to pay a small % more pcm for shorter notice term.

It goes along with modern trends such as of having to pay a "booking fee" to access a fixed-rate mortgage (on top of an arrangement fee for any type of mortgage).

There is also a trend in investments to have 2 or more sets of interest rates/fees for exactly the same type of account differentiated only by the date you opened it (Thingamabob Watsit, Issue n).

Ultimately inventing names for new fees with combined with chasing new customers and profiting on inertia are probably easier than developing new ways to provide added value.

Edited by prlzx (Tue 14-Jul-20 14:50:49)

Yeah, I guess Richard Tang's "Happy customers" mantra is more like "Milked customers".

I'll be better off in the long run, but I really do wonder whether I should have just jumped ship.I mean, I just signed up to another 12 month contract!

Edited by AndyPandy (Tue 14-Jul-20 17:21:49)

In reply to a post by RobertoS:

The "contract" was for a minimum term. IIRC Ofcom now require ISPs to notify customers that they have reached the end of it. Precisely so they know they can move without penalty.

You are correct, you would have been left on a monthly rolling one, but its price with many ISPs would be higher than whatever you were on during the initial one, as those are often at a "reduced" first year price.

According to the Zen Web-Site, the Price does NOT change on Contract Completion:-

Lifetime price guarantee

You'll keep the same monthly price on your monthly bundle when your 12, 18 or 24 month contract ends

I "regraded" in August 2019, to the same Unlimited Fibre 1 plan which I had been on right up to the renewal at a new lower price and the Zen Agent stated that there was no admin or setup fee due because I was staying on the same product.

I also received a free Fritzbox 7530 as well.

Is it perhaps up to the judgement of the Agent on the day?

I plan to renew next month which should shave another couple of £s so will see if this admin fee is to be imposed.