A ban on “confusing” mid-contract price hikes for broadband and mobile services is set to take effect later this month, but experts caution that some customers may still face “unfair” bill increases. Ofcom has ruled out linking mid-contract price rises to inflation, mandating that customers must be clearly informed in “pounds and pence” about the increase amount.
The new regulation will be enforced from January 17. Previously, telecom companies could adjust prices mid-contract each April based on inflation, with an additional increase of up to 3.9%. This policy led to significant bill spikes for millions of households in 2023, with increases reaching as high as 17.3% after inflation hit a 41-year peak.
Despite the changes, consumer experts suggest that those on lower-priced contracts might not benefit from the overhaul, especially now that inflation rates have decreased, standing at 2.6% in November. Andrew Ferguson, editor of thinkbroadband.com, explained to The Sun that a customer paying £24.99 monthly for broadband, facing a £3 monthly contract rise, would end up paying more than if the hike were tied to inflation.
With a 6.5% increase (combining the November inflation rate and an additional 3.9%), their bill would go up by £1.62 per month. Conversely, for someone with a pricier £59.99 monthly contract, a flat £3 increase would be less than an inflation-linked rise, which would add approximately £3.89 to their monthly bill, reports the Mirror.
An Ofcom spokesperson earlier remarked: “Inflation might be low now, but as we’ve seen in recent years, it can be incredibly volatile, and we don’t think consumers should bear that risk. Our intervention means customers will have certainty and clarity upfront about the prices they will pay, so they can compare offers and select the best deal for them.”
How much more could you pay for your internet and mobile phone from April?
Here’s a rundown per provider…
BT
BT is set to increase charges, with mobile users seeing a hike of £1.50 per month starting from April. TV patrons will face an additional £2 monthly fee, whereas broadband users will incur £3 extra per month.
Charges outside of bundles are scheduled to rise by 5% annually. However, BT pledges to exempt financially vulnerable customers or those subscribed to its Home Essentials package from these rises.
EE
EE echoes BT’s move, with mobile subscribers anticipating a £1.50 jump each month, TV consumers facing a further £2 monthly charge, and broadband clients being hit with an extra £3 on their bills. A similar annual increment of 5% applies to services beyond the bundle.
Yet, EE assures no price surge for financially vulnerable individuals or those holding an EE Basics plan.
O2
O2 customers should prepare for a £1.80 uplift in their monthly airtime bill come April, though their device repayment fees are promised to stay constant. Price increments of 75p apply to mobile broadband and smart watch services; nevertheless, social tariff users and pay-as-you-go clientele will evade hikes.
Plusnet
Plusnet’s announcement indicates their clientele will absorb a £3 elevation in monthly broadband costs from April onwards.
Three
Customers of Three mobile will experience a rise in their bills this April, ranging from £1 to £1.50 per month, based on their data allowance. If your data allowance is 4GB or less, your bill will increase by £1 per month.
For those with a data allowance between 5GB and 99GB, the increase will be £1.25 per month, while customers with a data allowance of 100GB or more will see an increase of £1.50 per month. Three broadband customers will face a capped monthly bill rise of £2.
Virgin Media
Virgin Media customers can expect their prices to go up by £3.50 per month from each April. However, this won’t apply to customers on social tariffs.
Vodafone
From April, Vodafone broadband customers will see their bills increase by £3 per month, while mobile phone customers will face price rises of either £1 per month or £1.80 per month, depending on their contract. Customers identified as financially vulnerable, those on social tariffs, and pay-as-you-go customers, won’t see their prices rise.