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Mid–contract price rises: What you need to know

Man using smartphone

Mid–contract price rises made in-line with inflation have been headline news in the tech world in recent weeks. But it’s only now, as the new financial year gets underway, that their true impact will be felt by consumers.

New research from Tarafica, commissioned by Tesco Mobile, lays bare just how much more smartphone owners have had to pay since inflation pay rises first came in in 2013: a whopping £1.25 billion, including this year’s price hikes.

So, how much are these rises likely to cost you? Read on and we’ll explain all.

Which networks are putting their prices up and when?

ee store hero

All the major networks are rising their prices in-line with inflation. EE has pushed its prices up by 2.7%, slightly higher than the retail prices index (RPI) rate of inflation, which stands at 2.5%. It says that its customers will pay an average 60p more a month, with the rise having come into effect from 30th March.

Three, Vodafone and O2 are all pushing up prices by 2.5%. However, those on O2 Refresh will only see the Airtime part of their plans go up. The cost of a handset on O2 Refresh will remain the same. O2’s prices went up on 1st April, as did Vodafone’s. Three says its price rises will come into effect from 1st May.

How much more can I expect to pay?

Smartphone bill hero image

If you have an EE contract and pay £35 a month, you can expect to see your bill go up by 94p. That’s a further £22.56 over a two-year deal. Meanwhile, O2 says a £38 deal will see a monthly rise of 95p.

It has, at least, offered a calculator on its website to let customers work out how much more they’ll pay. Overall, Tarifa reckons networks will make in excess of £220 million from RPI rises in 2019.

Are any networks freezing their prices?

tesco-pay-plus

Yes. Tesco Mobile has a Tariff Promise, which guarantees it will not raise the cost of its plans mid–contract.

Speaking about the recent rises, Tesco Mobile boss Claire Lorains said, “We believe that the price a customer signs up to is the price they should pay for the duration of their contract, no matter what happens with inflation.

Just as you wouldn’t expect to pay more at the till for your weekly shop than what’s advertised on the shelf, we believe mobile contracts should be no different.”

Are SIM-only plans exempt from mid-contract price rises?

SIM swap

Unfortunately, SIM only deals are subject to mid-contract price rises. So while you might have a cheaper deal than someone on a contract that also includes a phone, you will see a slight jump in your monthly bill.

The good news is that those on 30-day SIM only deals can serve notice on their plan and switch to a cheaper offer right away. Anyone on a 12-month SIM only package will have to wait until the end of their contract.

Are pay as you go deals affected?

Many phones

Mercifully, pay as you go deals are not hit by price rises, although networks can change these deals more frequently. However, if you’re a light user, it might be worth ditching your contract and switching to PAYG.

Deals from smaller providers, such as Tesco Mobile or iD Mobile, are well worth checking out and could save you a fortune.

Want to join a network that won't hit you with mid-contract price rises? Take a look at all our best Tesco Mobile deals.

Category: Features
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