The bigger the broadband provider, the bigger the annual price rise?
Millions of households are facing higher broadband bills, courtesy of annual price rises introduced by several of the UK’s major providers.
Sky, TalkTalk and Virgin Media all announced that they’d be raising prices on some of their deals. However, several other providers – including the UK’s biggest, BT – are also increasing thei
r prices. But unlike the price rises announced by other providers, these are baked into consumer contracts meaning customers have no choice but to pay them – and they happen annually.
Looking at the consumer price index, the average price increase was 3.7- 3.9 % despite the CPI rate of inflation being 0.6% as of January:
Broadband providers’ annual price rises
- BT: CPI + 3.9%
- EE Broadband: CPI + 3.9%
- John Lewis Broadband: CPI + 3.9%
- Plusnet: CPI + 3.9%
- TalkTalk: CPI + 3.7% (from 2022)
- Vodafone: CPI + 3.9%
What you can do about the price rises
Ofcom rules state that telecoms providers must offer their customers the right to exit their contract penalty free is they surprise them with price rises that are greater than inflation. But because these annual price rises are part of your contract, they don’t count as a surprise – meaning you have no choice but to pay the new higher price, or to pay an exit fee to terminate your contract.
Which providers keep prices fixed?
Most of us will be with the big providers- Sky, BT, Virgin, etc. But a lot of us do not know about Alternative Networks (Alt Nets) that are available. These Alt nets may not have the network scale of the big providers but often hold more value. With Alt Nets having a smaller customer base, it means the quality of their customer service is often better and more responsive. Secondly, due to their need to remain competitive around the big players, they can often offer faster speeds for less.
A Third way they create value is via fixing the contract price for the whole contract period. Zen Internet, for example, offers a lifetime price guarantee – if you take out a 12, 18 or 24 month contract, it promises not to increase your tariff as long as you stay on the same deal, even if you move house (assuming the deal is available at your new location). Hyperoptic and SSE both promise not to raise prices during your minimum contract period.
With this in mind, it’s always best to check out the smaller providers before jumping for big names.
How to find the best broadband deal
Despite annual price rises now being something to consider with certain providers, you’re still likely to be better off in a fixed-term contract than staying out of contract on an old deal. Providers can increase the price of out of contract customers – plus our analysis has shown that out of contract customers can pay as much as 85% more than those who are in contract.
If you’re on the hunt for the best broadband deal, Compare Fibre compares over 400 broadband packages and finds the best one in your area.