Black Friday 'deals' for new customers only?

[hotbit]

Just was on a chat trying to upgrade my broadband. Woman wasted almost 1 hour of my time pasting all kinds of questions and being away from the chat for minutes after each one, and at the end she offered me 350M plan for £56. She said price on the website is for new customers only.

Already £37 for 350/35 connection is a rip off.

I don't see any information on the website it's for new customers only.

What a waste of time a rubbish upgrade support.

Seems like a good time to change providers, another company will likely have same rubbish customer support, but I will qualify for a new customer 'DEAL'.

[hotbit]

After scrolling and scrolling down finally found 'New customers only' note.

Still, lady on the chat didn't need to waste 40+ minutes of my time, as at the beginning I've asked clearly that I want to upgrade to 350M.

[-tony- · Accepted solution]

cht is offshore - generally a waste of time as its scripted - if you are out of contract you need to talk to UK retentions - so

dial 150 or 0345 454 1111 and follow the prompts to - 'thinking of leaving us' - dont worry about that they do much more - open 8am -10pm 7 days a week - should take you to a UK call centre

if you get offshore just tell them you want to give 30 days notice that should get you transferred to the UK who usually have better deals - just forget the 30 days notice when you get to talk to a UK agent and see what they can offer

always best to have some idea what other providers are offering at what cost so you can add that to the conversation

[Andrew-G]

I agree it's poor the agent wasting your time, but only offering discounted deals to new customers is how commodity consumer services markets work if left to their own devices. In this case, VM make no money at all on new customer deals*, so they are in no hurry to hand them out to existing customers.  A skilled player of the Retentions Game can usually negotiate a decently discounted deal, but that assumes they do their research, choose their negotiating tactics carefully, and engage in a bit of brinksmanship.  

* Published accounts show VM actually make a significant net loss across all customers, but that means they're losing a whole lot more on new customer deals.    

[hotbit]

Thanks. VM offers start at around £30 a month (for 'deals) for something like 100/10 Mb. They have a lot of ways to show profit or not.
My friend in one of the EU countries upgraded his plan to - hold your horses - 500/500 Mbs, symmetrical. We have done speed tests a few times and it was showing around 490/490 +/-5, spot on. Now really hold your horses - he pays equivalent of £11/month and will pay close to £15 after 12 months. For many times slower connection VM is currently charging me ~£44.65

If VM offering 100/10 Mbs for £25 to £45 makes little or no profits... well, the question is where these profits are going to.

But VM rules are their rules, ok. What I was annoyed with the most was bot-like person in the customer support, who wasted a lot of my time. But nothing new here 😉

[Anonymous]

VM do make a profit but probably wouldn't if they handed out the intro discounts to everyone. This is a topic that comes around all the time.

Adjusted EBITDA less P&E Additions decreased 14.3% YoY on an FX neutral pro forma basis to $507.8 million in Q3, including $28 million of opex and capex costs to capture, while investing in capital projects to deliver future growth.

[Andrew-G]

If anything VM (and parent company Liberty Global) are hiding the losses, not hiding the profits.  If you look at published data for investors, it's all puff about EBITDA, which is Earnings Before Interest, Tax, Depreciation and Amortisation.  In plain English, EBITDA is "the profit we'd make if we had free borrowing, could avoid all taxes, and pretended our physical assets, software and brand will last forever".  

Take account of the fact that they do need to pays taxes and interest, and they have to slowly write down their assets, and in the most recent results, VMO2 made a net loss of around £800m in the preceding three months, and about £2.5bn loss in the first nine months of the year.

Regarding other countries, that £11 is good value, but if you work out what it costs to provide a large scale customer service operation (about £5 a month per customer including administration, sales, marketing, billing, bad debt, customer service) then there's £6 a month a left to provide that symmetrical 500 Mbps connection.  Customer premises equipment is say a £50 hub, with an asset life of four years, so that's a quid a month, you're now down to £5 a month to pay for internet traffic costs, wide area network backhaul, local infrastructure, network operations, field operations.  I've worked for a range of infrastructure businesses with large customer operations, providing the serious technical stuff for a five a month is simply not economically possible, so whilst I don't doubt the truth of what you say, somebody somewhere is paying the balance, either through inequitable allocation of costs or by some subsidy mechanism.

[hotbit]

VMO2 finances are a bit off-topic, but I had a quick view at recent results and it's showing small but still £121.8 million profit for the first 9 months 2021? Or was I looking wrong? Their debts seems huge, though!

No time to get deep inside those numbers, but it reminds me when Michelin took over a small tyre company. The company had stable and dynamically growing net profits of $10-20 mln each year, and was heavily investing in R&D and production lines. It was sponsoring local football club and had spawn up several other companies. After Michelin bought 98% of shares, company was still on the stock market for another 2 years, but each year managed to show only about 100 thousand dollars of net profit! Although sales was still at about same level or growing as in the last year of being independent. Of course after the take over they immediately stopped sponsoring the football club and closed local labs etc.
Another interesting take over - a mobile company bought by FT/Orange. The name was changed to Orange (global brand bla bla). But most important was the company had to pay ~$50M a year for the 'privilege' of using the name.

It's very difficult to properly understand financial results. For example we don't know what exactly are costs or 'know how' they throw into Depreciation and Amortisation position.
So these numbers in financial statement for me are just some numbers, I can't draw any conclusions from just looking at the surface, and to see inside is very difficult.

[Andrew-G]

@hotbit VMO2 finances are a bit off-topic, but I had a quick view at recent results and it's showing small but still £121.8 million profit for the first 9 months 2021? Or was I looking wrong? Their debts seems huge, though!

No, you're right that they declared 121.8 for the first nine months, but if you look at how that arose it looks to be largely down to a halving of financing costs compared to the same time the previous year (and don't forget that VM + O2 on a pro forma basis, so buoyed up by O2 results).  Since debt and interest rates are much of a muchness, there must be some big shenanigans going on behind that, I'll let you form your own opinions on how that might have come about and how tangible the published profit is.  I've spent years looking at company reports and earnings releases for my work, I'm pretty comfortable with pulling out what matters and drilling through financial detail, yet with VM and LG results I'm always surprised at how opaque they are, and how they get away with being a listed company with such obscure and limited transparency.  The convoluted financing and impenetrable accounts are not an accident.  I wouldn't invest tuppence in a company that has such deliberately complex accounts; it all looks like smoke and mirrors to me, but presumably their investors are cleverer than I am and fully understand the complex corporate structure, peculiar governance, byzantine capital and debt structures and frequent corporate transactions.  Still looks to me like a company that should be listed on the Kazakhstan stock exchange.

If you wade through the Companies Act reports for Liberty Global plc, you see (around about page 73 of the annual report) that the company made an annual loss from continuing operations of $1.5bn in 2020, before that the same in 2019 and in 2018.  In 2017 they lose marks for consistency by hitting a loss of $2.4bn from continuing operations, although in the three prior years to that they made an average loss from continuing ops of $700m a year.  So a very convincing impression of structural unprofitability.

[Omen_Data_Syste]

Just had the same conversation wasting 30 mins of my time trying to use the old "your useage means you should be on a higher mbps",.

They dont seem to understand or probably do that the amount of data you consume has nothing to do with the speed you need!

I tried to explain that I am actually a Cisco network engineer with 30 years experience but the guy continued to try and put me off moving to another provider by giving totally incorrect info - even told me the 50mbps tariff no longer existed yet when i was cut off waiting for disconnections (funny that) i had to phone again then the next guy tells me that was nonsense and it still exists.

They will tell you anything to get you to upgrade or not leave them.

Apparently you have to wait 32 days after your contract is over and terminated as well before you can be considered a new customer and enjoy the Black Friday deals for new customers. They will also send you, your info on how much your new contract is going to cost you less than 30 days before your contract ends so you end up not being able to give them the 30 days notice they require and end up paying for another month at the new (usually higher) cost - cynical or what!

Never have I met a more cynical company dedicated to money at the expense of customer service.

I thought Scottish Power were bad but VM are almost as bad but at least are not as incompetent!