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bill shock roaming

Broadband and home phone prices for loyal customers have risen by 40% in just four years, uSwitch research reveals, as providers continue to take advantage of consumers who don’t shop around for the best deals.

The surge in prices means UK households who stay with their long-time provider are paying a total of £61 million more per month for their broadband and home phone than they were in 2011.

That equates to each bill-payer who stays with their broadband provider paying an extra £8.59 per month on average than they were four years ago. Over a year, that’s an additional £103.

The findings come despite the fact that there are currently more broadband deals than ever with free and cut-price introductory periods available to new customers.

Non-fibre broadband deals (including line rental)
Provider Average monthly cost following contract end (2015) Average monthly cost following contract end (2011)
BT £25.20 £20.30
Sky £27.40 £22.25
TalkTalk £30.99 £27.90
Plusnet £26.39 £17.75
EE £26.98 £18.48
Average £27.39 £21.33

But while prices during these 'incentive' periods continue to fall, standard pricing once the contract period ends has gone in the opposite direction.

Despite the price rises, consumers remain unwilling to seek out better deals, however.

Of those surveyed, almost one-third (30%) have never switched provider, while only one- fifth (20%) have switched in the past year.

Ewan Taylor-Gibson, broadband expert at uSwitch, said: “There are no prizes for loyalty. Broadband users who take the time to switch provider or tariff are quids in, but it’s a very different story for the old faithfuls who end up penalised for their inertia.

“And due to rising prices it’s getting worse. Broadband customers pay 40% more for their loyalty now than four years ago.”

Fibre broadband deals (including line rental)
Provider Average monthly cost following contract end (2015) Average monthly cost following contract end (2011)
BT £42.99 £31.90
Sky £37.40 N/A
Virgin Media £34.49 £27.40
TalkTalk £35.20 N/A
Plusnet £31.98 N/A
EE £36.35 N/A
Average £36.40 £29.65

A lack of transparency about the end of contract terms is likely to be a major factor in customers’ unwillingness to switch. This was a problem in the energy market but has been improved by the introduction of fixed-deal notifications in April 2014.

More than four in ten of the broadband customers quizzed (44%) admitted they were unsure when their broadband contracts end, leaving them exposed to price hikes.

Taylor-Gibson said: “The UK telecoms market shows real similarities to energy, where loyal customers of the ‘big six’ providers end up paying an average of £295 a year more than those who switch regularly.

“In 2014, the energy market introduced end of fixed-deal notifications, which encourage more people to consider switching, rather than languishing on expensive tariffs. If Ofcom were to introduce a similar system for telecoms, it would really help people keep track of rising prices.

“If you’re out of contract, move provider to make the most of introductory deals and keep bills down. Remember to make a note of when your contract ends - that’s the time to start shopping around for a better deal.”

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