Why Do Broadband Providers Increase Their Prices Once You’ve Signed Up?
Monday, 20th July 2020
Stop us if this sounds familiar: you have your monthly budget... rent, bills and expenses all totted up. It’s tight, but you can manage. Then you find out that your provider is increasing the cost of your broadband.
It would be great if broadband prices stayed the same, right? Sadly, they don’t. Prices always go up and we all just have to lump it and pay our bills... after all who can live without broadband in this day and age?!
If you don’t know why Sky, Virgin, BT and other major providers increase their prices once you’ve signed up, we’ve got the answer for you... and what you can do about it.
Prices increase with inflation
Most of the time, broadband providers increase their prices in line with inflation. Increases are incremental and sometimes go unnoticed. Price increases are outlined in the terms and conditions of most contracts.
The UK’s major networks, Sky, Virgin and BT have all increased their costs in 2020. For example, BT customers who signed up to the Unlimited Broadband package between January 11th, 2019 and January 16th, 2020 have seen the price of their broadband increase by 1.3% or 59p a month (from £45.49 to £46.08 per month.)
Now 59p may not break the bank, but it isn’t the only increase BT customers have experienced. Out of allowance calling rates and optional add-ons also increased in line with the Consumer Price Index (also called the headline rate of inflation.)
What can you do? Before you sign on the dotted line read the contract terms and conditions of your contract. This will tell you whether your broadband package could change in the months or years to come.
When services increase so do prices
Almost all providers attract customers with misleading statements like ‘the lowest ever price for fibre broadband’ or ‘lightning fast fibre for only £34 a month.’ Sounds great, right? Well, such promises only tell half the story.
Providers will attract customers by offering a reduced monthly broadband cost for a period (usually 18 months). Then prices will increase... in some cases by as much as 89%!
Providers argue that prices increase because their services have. Then there’s the infrastructure cost to keep the network running with a faster connection speed or larger monthly download allowance. But is this really the case? And, more to the point, is it really fair for broadband providers to increase prices so drastically?! Keep reading to find out what you can do.
Experienced a price hike? You can cancel without penalty
Don’t be fooled into thinking that you’re stuck paying for expensive broadband. Ofcom has said that customers can cancel contracts without a penalty if any increase is greater than the CPI (which shows the percentage rise over the last 12 months.)
The only condition is that you have to cancel your broadband contract within 30 days of being told about the price increase. However, if your provider has warned you about the price rises and they’re in line with the CPI, and you still want to cancel your contract, you’ll have to pay an exit fee. This can be the equivalent to the entire term left on your contract.
Prices may increase, but you don’t have to keep overpaying
The bottom line is that broadband providers increase their prices... nothing is going to change that. However, that doesn’t mean that you’ll be stuck paying more than you can afford. Find great broadband deals in your area – click the link here to switch and start saving.