mobileu.co.uk

36-month mobile phone contracts to be banned

New EU laws are on their way which will effectively ban the use of increasingly popular 36-month mobile phone contracts.

A new study by uSwitch has found that 39 per cent of mobile phone users are tied into a 24-month contract, whilst just 12 per cent have a 12-month contract and 34 per cent have an 18-month plan. There are currently 3,300 36-month contract deals on the mobile phone market, compared to just 279 12-month deals. However, these three-year plans will be banned within three months and 12-month contracts will be compulsory.

From this May, mobile phone retailers will forced under EU law to offer customers the option of a 12-month contract. They also won't be allowed to offer contracts longer than 24 months, meaning 36-month deals will no longer be legal.

Three-year deals are said to have become more popular due to the growth of smartphones, as they provide a way for retailers to make their money back when they have given expensive handsets away for free.

Ernest Doku, technology expert at uSwitch.com, said, “While long contracts help spread the cost of expensive handsets, it's alarming to see how popular 36-month deals have become. It’s no bad thing that the EU is culling these in their infancy – three years is a lifetime in the world of tech.

"Consumers could easily find themselves saddled with an obsolete phone, not to mention a contract that no longer suits their needs," he added.