The telecoms watchdog has intervened over concerns that the new £1,000-plus iPhone X of Apple could be used to bind consumers into a three-year mobile contract.
Ofcom has prohibited 36-month contracts to protect consumers. However, the price of the latest Apple flagship has urged Virgin Media to look for a way around the regulation.
The company is offering consumers with a three-year repayment plan for the handset, with customers told that they can opt to cancel their mobile service contract at any time only in the small print.
While technically not against the rules, the deal that was unveiled last week has prompted a warning from Ofcom.
A spokesperson for the regulator stated: “We have concerns about the transparency of Virgin’s contract terms, which we are raising with the company.”
The increasing price of top-of-the-range smartphones is testing the capacity of mobile operators to bundle them with service contracts. Last week, Three faced criticism for offering the iPhone X on a £117 per month two-year contract.
Paying for the handset through a longer, separate credit agreement divides the cost more, although Ofcom is expected to demand more information for consumers.
A Virgin Media spokesperson stated: “We always aim to be clear with our customers and have a range of mobile plans that offer fantastic value and flexibility.
“Our 36-month iPhone X contract is a ‘Freestyle’ plan which splits the handset and airtime costs. Virgin Mobile customers have the flexibility to change, or terminate, their airtime plan every 30 days and handsets are sold unlocked to make switching providers easy if desired.”