Ofcom has fined Virgin Media £28 million for making it unreasonably difficult for customers to cancel their contracts and switch to a rival provider. It’s the largest penalty the regulator has issued under its consumer protection rules for direct consumer harm, based on conduct that ran from 1 January 2022 to 11 September 2024.
The findings are unusually specific. Ofcom, the independent regulatory and competition authority for the UK communications industries, concluded that millions of calls were likely mishandled, with agents reportedly transferring customers unnecessarily between customers, placing them on hold without reason and deliberately dropping calls. In some cases, cancellations were failed to be processed altogether.
The more significant finding, though, sits behind the behaviour. Ofcom determined that Virgin Media’s commission scheme financially rewarded agents for these tactics, while training, quality assurance and oversight of third-party call centres failed to identify what those incentives were producing.
The breach was of General Condition C1.8, which requires that a provider’s termination procedures do not act as a disincentive to cancel. Virgin Media had previously been fined under the same rule in 2018 – the penalty was reduced by 30% for admission and settlement, and would have otherwise exceeded £40 million.
Now, the question that this ruling poses is not whether a business instructs its agents to obstruct cancellations. It’s whether its retention model rewards them for doing so. A few industry experts share their thoughts.
Our Experts
- Casey Solomon: Head of Marketing at bOnline
- Mahendra Balal: Enterprise Strategist at Sovereix
- Mark Haines-Lacey: Partner & CEO of Atlantic Growth Solutions
- Finlay Wellington: Founder of Wellington Web Co
- Oliver Moheda: Founder & CEO of Total Artist Management
Casey Solomon, Head of Marketing at bOnline
“The Virgin Media case should be a wake-up call for every subscription business. When success is measured purely by reducing cancellations, you can unintentionally create behaviours that put commercial targets ahead of customers.
Cancellation journeys should be designed to be simple, transparent and fair. If customers have to fight to leave, it’s usually a sign that the business is trying to solve a retention problem in the wrong place. The best retention strategy isn’t making it harder to cancel – it’s giving customers fewer reasons to want to.
This is also a reminder that incentives matter. The behaviours you reward are the behaviours you’ll get. If frontline teams are measured only on keeping customers, without balancing customer outcomes and compliance, the risk of poor decisions increases significantly.
For challenger brands like bOnline, trust is a competitive advantage. We believe customers should stay because they value the service, not because they’ve been trapped by the process. Businesses that make it easy to join, easy to leave and consistently deliver great service build stronger long-term relationships and stronger brands. In the long run, transparency isn’t just good compliance – it’s good business.”
Mahendra Balal, Enterprise Strategist at Sovereix
“The £28 million Ofcom fine against Virgin Media is a textbook example of “Goodhart’s Law” in enterprise operations: when a measure becomes a target, it ceases to be a good measure.
By heavily incentivising call centre agents to maintain high retention rates while simultaneously making the cancellation process digitally opaque, Virgin Media created a toxic operational paradox. Agents quickly realised that deliberately dropping calls was the most mathematically efficient way to protect their personal KPIs and bonuses. This was not a rogue employee problem; it was a systemic failure of incentive design.
For subscription businesses, this highlights a critical compliance risk: “dark patterns” are no longer limited to deceptive UX design on a website. They now extend into operational workflows. Regulators are increasingly scrutinising how hard it is to leave an ecosystem. When companies prioritise aggressive, friction-based retention over off-boarding compliance, they transform a standard churn metric into a massive regulatory liability. True retention must be earned through product value, not enforced through operational exhaustion.”
Mark Haines-Lacey, Partner & CEO of Atlantic Growth Solutions
“Ofcom’s findings point up, not down. The commission scheme paid for saves. Quality assurance did not inspect how the saves happened. Nobody had proper oversight of the third party centres. The agents did exactly what they were paid to do.
Most companies measure activity and treat the output as truth. A save gets logged. The dashboard turns green. Leadership never asks whether the customer stayed because they wanted to or because they ran out of energy. The number looks identical either way.
The two-tier cancellation process is the part I would look at hardest. Only second tier agents could process a cancellation, so every customer who wanted to leave had to ask twice. That is friction designed on purpose then counted as retention. You have not built loyalty there. You have built a trap and put a number on it.
Any subscription business can test itself in one afternoon. Ask what your retention figure would look like if every save had to be justified by the customer rather than the rep. If that question makes you uneasy you already have your answer.”
Finlay Wellington, Founder of Wellington Web Co
“At Wellington Web Co, we’ve worked with businesses that rely on trust to build long term customer relationships online. Cases like this are a reminder that good customer service isn’t just a nice extra, it’s part of the product.
When a company makes it difficult for customers to leave or ignores their requests, it damages confidence far beyond the people directly affected. News spreads quickly and businesses can lose years of trust in a matter of days.
From my perspective, the companies that stand out are the ones that make every interaction straightforward, whether that’s signing up, getting support or cancelling a service. Customers remember how they’re treated when something goes wrong far more than when everything works perfectly.
The Ofcom fine sends a clear message that businesses can’t rely on customer friction to retain people. Long term growth comes from providing a service customers genuinely want to stay with, not making it harder for them to leave.”
Oliver Moheda, Founder & CEO of Total Artist Management
“As Founder & CEO of Total Artist Management, I believe the Virgin Media case highlights a fundamental business principle: customer retention should be earned through trust, not made difficult through friction.
Every company experiences customer churn, but creating barriers to cancellation risks damaging a brand’s reputation far more than the short-term revenue it protects. In today’s digital world, customers share their experiences instantly, meaning poor service can have lasting commercial consequences.
We’ve found that transparency and responsiveness create stronger long-term relationships than restrictive processes. Even when clients choose to leave, making that experience professional and respectful increases the likelihood they’ll return in the future or recommend your business to others.
Regulatory action like this serves as a reminder that customer experience isn’t just a compliance issue – it’s a competitive advantage.”
