Citizens Advice is on the warpath against ISPs, accusing them of treating loyal customers unfairly because it isn’t clear that the cost of a broadband package can increase considerably once the initial discounted price expires.
You may well be aware that broadband providers generally have a cheap introductory offer on the cost of a subscription, but what Citizens Advice wants to highlight is that a considerable amount of folks don’t realise when the price of their connection goes up – and also that the extent of these increases can be very substantial.
According to new research from the charity, no less than 35% of broadband customers in the UK don’t realise that they face a price hike if they stay on the same plan with their ISP after the initial discount period ends.
Hence Citizens Advice says that customers remaining with the same provider are effectively having a ‘loyalty penalty’ exacted on them. And as mentioned, it’s a substantial fee.
According to the organisation, when the initial offer period expires, the average price rise of a broadband subscription is £113 per year. That’s almost £9.50 per month, and in percentage terms, an average increase of 43%.
Note that these figures weren’t calculated across all ISPs, but they’re an average of the cheapest basic broadband packages from the five biggest UK providers: BT, EE, Sky, TalkTalk, and Virgin Media. These are, of course, the plans that the majority of customers will be using.
The biggest offender, incidentally, was BT’s basic plan which carries an increase of 67% after the initial discount pricing runs out, leaving folks paying £16.50 per month more, or £198 over the course of a year.
Fixing the problem
So what should be done? Citizens Advice has called for ISPs to make it much clearer how much any particular package will cost after the fixed deal period ends, with upfront information provided in adverts, and in the details sent to subscribers when they sign up. As opposed to having these details hidden away in terms and conditions.
The charity also said that ISPs should text the consumer when the initial discount period ends, letting them know about the price increase which will be coming into play.
Citizens Advice also said that extra measures should be looked at for vulnerable customers, noting that older consumers (over 65) are more than twice as likely to have stayed with the same ISP for over a decade.
In a press statement, the charity said (opens in new tab): “Ofcom should define the vulnerable consumers who would be worst affected by broadband contract prices rises and explore ways to minimise the impact on them. One option could be to look at how a price cap, similar to the pre-payment meter cap in the energy market might work for broadband customers.”
In other gloomy broadband news we’ve seen recently, consumer watchdog Which observed that many broadband users in the UK are still struggling with poor connection speeds.