Paying more for less: Broadband customers spend extra £222m annually to stay on slower speeds
Customers out of contract waste an extra £222 million every year languishing on slower speed broadband – and 95% could switch to a faster, more reliable service that could even be cheaper
At least a third (32%) of customers with standard broadband are currently out of contract and paying on average £53.40 more annually than they would for fibre deals offering quicker speeds
On average, out of contract pricing for fibre increases 31% whereas customers on standard broadband face an average increase of 51% when they fall out of contract
In the case of BT, customers who are out of contract on standard broadband are paying more every month than those on expired fibre contracts – while Sky standard broadband customers face being hit by a 98% increase if they don’t switch
With Ofcom currently considering the regulated wholesale price for entry-level superfast broadband, Uswitch.com calls on the industry to do more to encourage the uptake of superfast services and help get customers languishing on expired ADSL deals onto more reliable and better value services.
More than four million broadband customers are paying over the odds to stay on sluggish broadband speeds despite superfast services now being available to 95% of the country, according to research by Uswitch.com, the price comparison and switching service.
A third (32%) of customers on standard broadband are out of contract and are paying, on average, £53.40 more a year than the average fibre contract. That’s a combined £222 million being spent on expired standard broadband contracts – a large proportion of which could be spent by users on faster and more reliable broadband services.
The average in-contract price difference between standard and fibre packages is £6.25 a month or £75 a year. With Ofcom currently considering the wholesale price for entry-level superfast products, the price that Openreach charges providers for access to its superfast network could come down by £20 a year – a discount that should be reflected in consumers’ bills.
Customers who are currently on expired standard broadband contracts could be saving money and getting a more reliable service by switching onto a fibre package offering superfast speeds. In the case of BT, the out-of-contract cost for standard broadband is actually higher than the out-of-contract cost for its fibre package – demonstrating how misconceptions around pricing of superfast packages and a lack of end of contract alerts are hitting consumers in the pocket, while they languish on a slower, less reliable service.
Fibre customers also face less of a jump (31%) compared to standard broadband subscribers (51%) when they fall out of contract. In the worst case scenario, Sky customers on the standard Unlimited Broadband deal could be looking at a whopping 98% increase as soon as their contract expires.
Richard Neudegg, Head of Regulation at Uswitch.com, says: “There’s a damaging misconception that fibre broadband services are prohibitively expensive which is just not the case. While the price difference between standard broadband and entry-level fibre in-contract is modest, it’s when you compare how out-of-contract pricing for standard broadband stacks up against introductory fibre deals that is the most surprising.
“In fact, customers who are languishing on expired traditional broadband contracts could switch to a faster, more reliable, service and make considerable savings too. These discounts could be even higher if Ofcom pushes through its ruling to discount the price at which Openreach sells its network to providers – a saving which should be passed on to consumers to encourage uptake of faster and more reliable services.
“This all raises the question of whether providers and the regulator could be doing more to ensure that consumers are aware of their options. While we are seeing investment into superfast – and even ultrafast – networks, there’s a real concern that the industry isn’t taking consumers along on this journey. The ‘build it and they will come’ mentality is putting consumers at risk of being left behind.
“We can see how this is playing out on the ground. As it stands, less than six in 10 people (57%) think they can get superfast speeds in their local area despite the Government recently confirming that superfast broadband was available to 95% of premises.
“In order to bridge this awareness divide, providers need to make their property-specific speeds data available to third parties so they can be easily presented, enabling customers to make a better informed decision about their telecoms services in their own homes.”
Table 1: The table below shows ADSL deals across the main providers – for the best available packages through Uswitch.com
| Provider | Package details | Average monthly cost during contract | Out of contract monthly price | Percentage difference
(Average monthly cost vs out of contract price)
| | BT | BT Unlimited Broadband & Calls
17Mbps
18 months
Unlimited downloads
Weekend calls
£19.99 setup
| £26.10 | £42.99 | 65% | | EE | EE Unlimited Broadband
17Mbps
18 months
Unlimited downloads
£10 setup
| £22.06 | £30 | 36% | | Plusnet | Plusnet Unlimited Broadband & Phone Line
17Mbps
12 months
Unlimited downloads
£0 setup cost
£50 cashback
| £15.82 | £28.98 | 83% | | Sky | Sky Unlimited Broadband
17Mbps
12 months
Unlimited downloads
£9.95 setup cost
£50 Mastercard
| £14.66 | £28.99 | 98% | | TalkTalk | TalkTalk Fast Broadband
17Mbps
12 months
Unlimited downloads
£0 setup fee
| £19.95 | £27 | 35% |
Source: Uswitch.com research. Correct as of 7th February 2018
Table 1: The table below shows fibre deals across the main providers – for the best available packages through Uswitch.com
| Provider | Package details | Average monthly cost during contract | Out of contract monthly price | Percentage difference
(Average monthly cost vs out of contract price)
| | BT | BT Infinity Fibre Unlimited Broadband & Calls
52Mbps
18 months
Unlimited downloads
Weekend calls
£59.99 setup cost
£100 BT Reward card
| £27.77 | £41.99 | 51% | | EE | EE Unlimited Superfast Fibre Broadband
38Mbps
18 months
Unlimited downloads
£35 setup cost
| £30.94 | £35 | 13% | | Plusnet | Plusnet Unlimited Fibre Broadband & Phone Line
38Mbps
12 months
Unlimited downloads
£0 setup cost
| £24.99 | £33.98 | 36% | | Sky | Sky Fibre Unlimited
38Mbps
18 months
Unlimited downloads
£59.95 setup cost
£50 Mastercard
| £32.55 | £38.99 | 20% | | TalkTalk | TalkTalk Faster Fibre Broadband
38Mbps
18 months
Unlimited downloads
£0 setup cost
| £25 | £33.50 | 34% | | Virgin | Virgin Media VIVID 50 Unlimited Superfast Fibre Broadband & Phone
50Mbps
12 months
Unlimited downloads
Weekend calls
£20 activation fee
£50 bill credit (Uswitch exclusive)
| £30.67 | £40 | 30% | | Vodafone | Vodafone Unlimited Fibre 38
38Mbps
18 months
Unlimited downloads
£0 setup cost
| £20 | £25 | 25% |
Source: Uswitch.com research. Correct as of 7th February 2018
Uswitch’s Connectivity without Complexity campaign has been looking at these key issues and exploring their impact on consumers. We believe it’s time the industry gives the facts – being open and upfront with the information that matters, removes the needless hoops that consumers are made to jump through and works to ensure the road to faster, more reliable connectivity is a journey for all. To find out more, visit www.uswitch.com/connectivity.
Find out how you could save over £1,000 a year with Uswitch here.
FOR MORE INFORMATION
Claire Jones
Phone: 020 7148 4663
Email: Claire.Jones@uswitch.com
Twitter: @uswitchPR
Notes to editors
Calculation: 25.3 million fixed BB connections in the UK (Source: Ofcom)
32.2% - or 8,144,790 - of these are out-of-contract (Source: Uswitch) 51% have a headline speed of less than 30Mbps. 51% - 4,153,843 - of these are on ADSL contracts (Source: Ofcom / ISPreview) Expired ADSL contract customers are paying on average £4.45 (31.59 - 27.14) more a month than those paying for in-contract fibre Yearly that is: 4.45 x 12 = £53.40 53.40 x 4153843 = £221,815,216.2
Broadband Delivery UK has provided superfast broadband coverage to 95% of UK premises
Table 3: The table below shows the difference between the in-contract cost of broadband packages compared to out-of-contract. This is based on costs for packages across the six biggest providers
| Ave in contract price per month for broadband | Ave out of contract price per month for broadband | % difference | |||
|---|---|---|---|---|---|
| ADSL | £20.89 | £31.59 | 51.2% | ||
| FIBRE | £27.14 | £35.49 | 30.8% |
Source: Uswitch.com research. Correct as of 7th February 2018
Source: Ofcom, March 2017
Calculation: £6.25x12 = £75
See tables 1 and 2
From Uswitch research conducted via Opinium from 28-31 July 2017 (Source: Uswitch) .
About us
It’s all about “U”!
Thank you for indulging us over the last 20 years by using a small ‘u’ and a big ‘S’ when writing about our brand in your articles.
We are delighted to let you know that you are now off the hook - it’s big U’s all the way (and small s’s) as we undertake our biggest ever rebrand - so let your autocorrect go wild!
About Uswitch
Uswitch is the UK’s top comparison website for home services switching. Launched in September 2000, we help consumers save money on their gas, electricity, broadband, mobile, TV, and financial services products and get more of what matters to them. Last year we saved consumers over £373 million on their energy bills alone.
Uswitch is part of RVU, a new business that also owns Money.co.uk and Bankrate.
If you would no longer like to receive our press releases please email prteam@uswitch.com with 'unsubscribe'.