Carphone Warehouse has dragged the telecoms regulator Ofcom into a row over changes to BT tariffs by claiming the telco giant is tying people into anti-competitive contracts.
The owners of the TalkTalk brand lodged a complaint with the regulators last week claiming that upcoming changes to BT residential tariffs were anti-competitive but other competitors have dismissed the complaint as baseless.
Carphone Warehouse blamed a new clause within BT’s consumer contracts that automatically renews the contract after 12 months unless the customer cancels. The firm claimed this would lock BT customers into their contracts and effectively elbow other carriers out of the local-loop unbundling (LLU) market.
Andrew Dickinson, sales and marketing director at business ISP Griffin Internet, believed Carphone Warehouse would face a challenge in getting Ofcom to uphold its complaint, as it had already given the thumbs up to renewable contracts provided that they benefited the customer: "It is unlikely they would make headway."
But one dealer said that most customers were "pretty chilled out" about automatically-renewing contracts and thought Carphone Warehouse would be better off doing "exactly the same thing" instead of complaining.
"It has thrown its toys out of the pram. Why don’t they just replicate it? In all fairness it strikes me that Carphone has missed a trick," he said.
Another industry watcher said: "Charles Dunstone, Carphone Warehouse CEO, is trying to get critical mass, and this is really going to hurt him as so many millions of people are still on BT contracts."
However, he suggested the complaint could serve to make Ofcom revisit its previous decision.
BT was quick to dismiss the complaint, saying its customers would have ample time to cancel their contracts.
Carphone Warehouse and Ofcom were unavailable for comment