Virgin Net under attack for free pricing plan

Virgin Net has been accused of botching its transformation into a free Internet service provider (ISP).

The company used to charge £11.99 a month for Net access and limited content, but was forced to rethink its pricing following the success of Dixons' Freeserve and other free services.

Under the new pricing model Virgin Net customers can either pay £5.99 a month and have free support, or pay no monthly subscription and pay £1 per minute for technical support over the phone (the initial Freeserve model).

But the change between the pricing models has been handled badly, according to some users.

One account holder told Silicon.com she was surprised that although she opted for neither service, £5.99 was debited from her bank account in April. She had assumed that having not stated a preference, the service would become free.

James Roper, joint managing director at the Interactive Media Retail Group (IMRG), an independent Internet monitoring body, said: "This is a highly dubious way of handling the change-over. Users should note that Virgin Net isn't wearing our [best practice] hallmark, and the way they're handling things, they wouldn't get it."

In its defence, Virgin Net said it has sent emails to all its subscribers explaining the new set-up which said: "If we do not hear from you, we will presume that you wish to take the [£5.99/month] subscription option." It also said it is easy for users to change which price plan they are on - something industry watchers have welcomed.

However, Scott Thompson, head of retail payments consultancy QPQ and the man behind Switch, also said he was "incensed" by this so-called 'negative option'.

"I for one didn't notice this 'negative option' buried in their email and I've been working for years with banks and other companies using this kind of tactic," he said. "Virgin Net should be forced to go to those who haven't responded and put them on the free option, unless they want the other service."

A spokesman for the Association of British Insurers confirmed: "The 'negative option' is now roundly frowned upon, if not actually illegal, in this industry. Literature has to make choices very, very clear."

Daniel Bieler, ISP analyst at Ovum, said: "Customer service is becoming increasingly important. It's not as if Virgin Net are the only ones offering these services. They have a decent reputation - for example NTL have proved a reliable telco to partner with - but they cannot afford to be complacent."

Virgin Net has said it will consider refunds for users who wanted free access but who were by default put onto the £5.99 per month price plan. The ISP's customer service number is 0845 650 0000.