Consumers are missing out on tens of millions of pounds of savings due to problems with switching broadband provider, it has emerged on the day that regulations to make it easier to switch come into force.
A uSwitch Tech study found that Britons miss out on potential savings on their broadband bills of some £83 million per year, with around two million frustrated customers being thwarted in their attempts to switch over the past 12 months.
Keen to switch provider? Find out more about the new rules and how to switch your broadband supplier with our guide: How to switch broadband provider
Inertia, a complicated switching process and barriers put up by providers combined to dissuade consumers from switching in search of a better, cheaper broadband service.
Some 25% of those surveyed admitted they had never switched provider, on the grounds that “it’s not worth the hassle or is too complicated.”
The growth of bundles that combine pay-TV with broadband and other services is also a bulwark against switching. Almost one in eight (13%) of the sample said that they have never switched broadband provider because they are tied into packages.
uSwitch’s findings come as new regulations come into force that eliminate elements of the broadband switching process that have long been identified as obstacles to changing provider.
From hereon in, consumers switching between providers who use OpenReach as the basis for their fibre broadband or standard broadband service, such as BT, TalkTalk and EE, no longer have to contact the provider that they are leaving to cancel their contract.
Instead, the whole process has been streamlined and will be entirely handled by the provider that the customer wishes to join and which has more incentive to handle the switch promptly and smoothly.
Ofcom has also done away with Migration Authorisation Codes (MAC), which were previously required to switch between providers and could only be obtained from the provider the customer wished to leave.
MAC codes were little understood by customers and were found to unnecessarily complicate the switching process.
However, it's notable that the rules do not apply when consumers switch to or from Virgin Media’s cable broadband service, which accounts for some four million broadband customers.
In these instances, consumers still have to contact the provider they want to leave, with the result that a major barrier to switching remains in place. The lack of a single, unified process also means customers may still be confused by what’s required of them to switch.
Commenting on the findings Ewan Taylor-Gibson, broadband expert at uSwitch.com, said: “While we’re getting the hang of switching some home essentials like car insurance, when it comes to broadband, pay TV and mobile, people are nowhere near as proactive.
“But this is not an open-and-shut case of consumer apathy. Telecoms is the only sector still languishing under a system where the company you are leaving handles the switch. They’re hardly going to fall over themselves to pack you off to a rival provider."
Taylor-Gibson added: “The good news is that Ofcom is making improvements to broadband switching from 20th June, which will hopefully improve some customers’ experiences of moving to new providers.
“The bad news is this won't include mobile, pay TV or Virgin Media's broadband network. Industry-wide changes are needed to have far more of an impact.
“The price difference between the cheapest and most expensive broadband deals on the market right now is £120 per year, so we’re not talking about small change. Moving providers or moving deals really does save people money, so it should be simple for consumers to do.”
The survey also revealed that 51% of broadband customers would be more likely to switch mobile, broadband and pay TV provider if there was no obligation to contact their current provider.
A further 41% said they’d more inclined to switch if there was a guarantee there would be no interruption in service, while 26% said they were be encouraged to switch if a rigid timeframe was enforced for the switching process.