Have You Ever Pondered Why Phone Agreements Have Increased From 12 Months In Length, Right Up To Two Years?

Heading back to 2004, if you took out a mobile phone contract, you could just about guarantee it would be for a 12 month period. You would most probably have been provided with a free phone by your local mobile phone dealer and also have been given a pack of inclusive minutes along with a pre determined text message allowance. When you got in to the 11th month of the contract, the network provider would have contacted you and offered you another free phone trying to get you to subscribe for another 12 month agreement.

As 2006 approached, several retailers and network providers started to replace the 12 month contract with the longer 18 month period agreement, which meant that the client would have to keep their phone for about 6 months longer than in previous years. There are two big winners from the longer 18 month term phone contract, and you could be sure that the customer is not one of them.

Understandably, the biggest winner in the longer term contract length would be the phone network provider, as in theory, they have now reduced their costs related to providing customers with free phones by around one third. Another silent winner was also the mobile phone insurance providers, as much more buyers decided to obtain mobile phone insurance to protect their phones, as they knew that there was a longer period where it could get lost or stolen, without any chance of another free mobile phone before the end of the 18 month contract.

Within a year of the new longer phone contracts, the network providers changed the guidelines yet again by increasing agreement time periods by another 6 months to a long 24 month period. Yet again the network providers reduced their costs since they only provide you with a free mobile phone every two years, their savings must run in to the millions each year. With the networks saving cash, the consumer is left to take the gamble of protecting their phone with mobile phone insurance, or opting to take the chance of it lasting two full years and not go missing, thieved or broken over the 24 month time period.

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