A class action lawsuit claims over 3 million customers of UK incumbent operator BT were exploited by tariffs that massively inflated the cost of standalone landline services relative to the price of bundles that included other services. Justin Le Patourel, a telecoms consultant and the former Head of Market Intelligence at UK regulator Ofcom, wants the Competition Appeal Tribunal (CAT) to award GBP300–400 (USD380-510) per person in compensation. Le Patourel insists upon urgency because the majority of overcharged customers are elderly, telling City A.M.:
More than 40 per cent of our claimants are aged over 70, and over 150 of them are dying every day. It really is vital that BT should refund every one of them as soon as possible.
Le Patourel argues BT consciously increased its tariffs for standalone landline customers even though its costs were falling. Per his calculations, some customers were overcharged by as much as GBP84 (USD107) a year. Others were ripped off because they had separate contracts for landline voice and broadband instead of being charged the same as a customer on a bundled tariff.
The allegation that BT takes advantage of older customers is hardly news. The telco cynically abused its most loyal and least well-informed customers by continuing to charge exorbitant landline handset rentals long after market liberalization meant it was much cheaper for customers to buy handsets outright. This particular lawsuit stems from an Ofcom review which found landline-only customers were getting a terrible deal relative to customers of BT’s broadband and TV bundles. BT responded by revising its tariffs in 2018 but no compensation was given to customers who had already been overcharged.
BT denies it has done anything wrong. They have already succeeded in delaying this class action lawsuit, which was instigated in 2021, through the use of an appeal that was rejected in May 2022.
Honest professionals are aware that telcos manipulate tariffs in ways that punish customers for their loyalty. I well recall attending a meeting where a former BT executive boasted about a strategy that was tantamount to subsidizing ‘growth’ segments like broadband by discounting the prices of bundled services whilst increasing the prices of standalone comms services. These people thought they were being clever, but the blatant nature of their profiteering encouraged a change in British law that means there will be more class action lawsuits like this in future.
