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Have You Ever Thought About Why Mobile Phone Contracts Have Increased From 12 Months In Length, Right Up To Two Years?
Going back to 2004, if you took out a mobile phone contract, you could only guarantee it would be for a 12 month period. You would most probably have been provided with a free mobile phone by your local phone dealer and have been given a pack of inclusive minutes along with a pre determined text allowance. When you got in to the 11th month of the contract, the network provider would have contacted you and offered you another free mobile phone in an attempt to get you to subscribe for another 12 month contract.
As 2006 approached, numerous retailers and mobile phone network providers started to replace the 12 month agreement with the longer 18 month term agreement, which in turn meant that the customer would have to keep their phone for around 6 months longer than in previous years. There are two big winners from the longer 18 month term phone agreement, and you can be sure that the consumer is not one of them.
Understandably, the biggest winner in the longer term contract length would be the mobile phone network provider, as in theory, they have now reduced their costs related to providing customers with free mobile phones by around one third. Another silent winner was also the mobile phone insurance companies, as much more consumers decided to get mobile phone insurance to protect their phones, since they knew that there was a longer period where it could get lost or thieved, with no chance of another free phone before the end of the 18 month contract.
Within a year of the new longer mobile phone contracts, the network providers altered the rules yet again by increasing contract time periods by another 6 months to a long 24 month period. Again the network providers reduced their charges as they only provide you with a free phone every two years, their savings must run in to the millions each year. With the networks saving cash, the customer is left to take the gamble of protecting their phone with mobile phone insurance, or opting to take the chance of it lasting two complete years and not get lost, thieved or damaged over the 24 month time period.
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