Four in five consumers say mid-contract mobile and broadband price rises are unfair, as 25 million mobile users and 10 million households on broadband deals face hikes next spring, according to new research from Uswitch.com, the comparison and switching service.
The majority of mobile and broadband providers link their annual price rises to inflation rates, measured by the Consumer Price Index (CPI) or Retail Price Index (RPI), with some including an additional price increase of 3-4% on top. With inflation at its highest level in decades, customers could be hit by price rises of around 14% at the end of March.
Three, the UK’s fourth-largest mobile network, is the latest to introduce inflation-linked mid-contract rises. The provider will now introduce an annual increase based on December’s CPI rate plus 3.9% – the same rate as EE and Vodafone – for all new and upgrading customers from 1 November 2022. This is a sharp increase from the 4.5% fixed rise they applied this spring. For those affected, it will start from April 2023, meaning they too will almost certainly face a double-digit percentage increase.
With more than than a quarter (27%) of consumers saying that an increase of £5 to their monthly broadband or mobile bill would cause them stress, two-fifths (41%) believe that mid-contract price rises should be stopped.
While many mobile and broadband providers are expected to press ahead with price rises next year, it was households supplied by broadband company Plusnet who were most likely to view them negatively.
Nine in ten (89%) of the Plusnet customers surveyed, many who received a rise of 9.3% earlier this year, viewed such charges as either “not very fair” or “completely unfair”. The provider had the highest proportion of broadband customers surveyed speaking out against the fees.
By contrast the research shows 80% of Brits want providers to offer fixed-price deals for their broadband and mobile, with no mid-contract rises built in.
Not all companies are planning mid-term price increases. Sky has frozen its pricing for new broadband customers signing up, while full fibre provider Hyperoptic has never enforced mid-contract bill rises. Their stance may gain them more subscribers, as a quarter of customers (25%) say they will take out their next broadband deal with a provider that does not apply annual price hikes.
Table: Which broadband providers are planning mid-contract increases
|BT||CPI + 3.9%|
|Community Fibre||It may (at its discretion)|
CPI + up to a maximum of 2.9%
|EE||CPI + 3.9%|
|John Lewis Broadband||No|
|NOW||No set price risebut “services are variable and our prices and services can change.” |
|Plusnet||CPI + 3.9%|
|Shell Energy Broadband||CPI + 3%|
|Sky Broadband||No set price risebut “services are variable and our prices and services can change.” |
|Talktalk||CPI + 3.7%|
|Vodafone||CPI + 3.9%|
Source: Uswitch.com. Correct as of 4th November 2022