Ignorance of mobile tariff costs £5bn a year

In a study of 2,034 people nearly half (47 per cent) were unaware of their data allowance, and number of free minutes and texts on their contract.

On average being on the wrong tariff costs each person £194 a year.

Of the £5 billion wasted, £173m came from additional data charges for accessing the internet.

And 81 per cent of those polled did not know having a Twitter app stored on the phone, though not in use, can still use up data, possibly resulting in extra costs.

The research, released yesterday by Carphone Warehouse, revealed there are now more than seven million mobile phone deals on offer in the UK.

The figure has been fuelled by the recent rise in smartphones with internet access – which has added an additional layer of complexity to an already baffling arena, pollsters said.

Andrew Harrison, Carphone Warehouse chief executive, said: “When the UK is facing one of the hardest financial times in living memory, it seems crazy that £5 billion is being wasted on phone bills.”

Lack of awareness was cited as a problem among phone users. People did not realise that video calling a friend through the Skype app (51 per cent), logging into Facebook through an app (43 per cent) and having a Twitter app stored on the phone though not in use (81 per cent) all contribute towards their data allowance.

Ambiguity also existed around the terminology used to describe data, with customers generally unsure what one “megabyte” meant when put into the context of the number of songs that can be downloaded (79 per cent), the number of emails that can be downloaded, read and sent (83 per cent) and the number of minutes that can be watched on YouTube (87 per cent).

Only just over a tenth of people (12 per cent) knew what 1MB would cost them outside of the data included in their contact.