Save, make, understand money

Household Bills

Mobile and broadband customers feel £14.4bn price hike

Mobile and broadband customers feel £14.4bn price hike
Matt Browning
Written By:
Matt Browning

Mobile and broadband customers face paying an average extra of £290 per year after an inflation-linked price hike kicks in, research reveals.

Broadband customers have seen their bills rise by £15.20 per month, while mobile bills have shot up by £7.90 in the last month.

This signifies an extra £182.40 and £94.80 coming out of customers’ pockets per year to stay connected, according to Uswitch.

The broadband price hikes were forecast to rise last year as part of mid-contract bill increases, described as “unpredictable and outrageous” by consumer champion Which?.

Since then, the regulator Ofcom launched a review into inflation-linked price rises, and it’s expected to can them when the consultation is published this year.

Those at risk of paying the most due to the increases are those who haven’t switched broadband providers for up to eight years.

You could be paying an extra £22.10 per month if you have been with that firm for that length of time.

Recent bill switchers will feel the smallest pinch

Further, mobile phone users on pay monthly and SIM-only contracts who haven’t switched for up to nine years will see a 67% average rise of £13.20 added on to your bill each month.

Conversely, mobile phone billpayers who only switched last year will feel a £6.70 rise compared to the national average of £7.90. This figure equates to a £11.75 increase for a broadband customer who switched last year, compared to a £15.20 surge for the rest of the UK.

The impact of the price hikes has come as a surprise to many customers, as one in five (23%) are not sure how much their new bill will be.

As well as that, almost half (44%) of the 2,000 respondents surveyed said they do not know when their contract ends – leaving them at risk of not being able to leave their contract penalty-free if they want to.

‘Ofcom ban doesn’t undo impact of price rises’

Sabrina Hoque, telecoms expert at Uswitch, believes the mooted Ofcom ban on inflation-linked prices “will be welcome news to consumers… But this still doesn’t undo the impact of year-on-year rises for millions of Brits.”

Hoque said: “There are a few different factors in play that contribute to these big variations, especially for those who have been with their provider a long time.

“A key factor is the compounding effect of annual year-on-year mid-contract price rises, as each year’s percentage increase will be based on a bigger and bigger total. After multiple years, this will really make a difference.

“Improvements in technology also mean even today’s ‘value’ packages across broadband and mobiles offer better value than they did five or 10 years ago – so many customers who haven’t switched in many years could effectively upgrade their package but pay the same or less.”

Hoque added: “Your provider will let you know when your contract is about to end, so don’t be tempted to ignore these emails when they come through – it really only takes a few minutes to run a comparison and see what else is out there.”