Lit Fibre’s Post

BT has become the first major telecoms company to scrap controversial above-#inflation price rises for #mobile and #broadband customers – but not before pushing through a final increase this year. The owner of mobile operator EE has moved to address the pressure on consumers from rising household costs during the cost of living crisis, after #telecoms companies were criticised for increasing bills. The UK’s largest mobile and broadband companies were accused of fuelling “greedflation” after a #Guardian investigation last year found they were pushing through above-inflation price rises. EE said customers will now be told clearly in “pounds and pence” the planned increase to their monthly bill from next year. The move comes a day before the official inflation figure for December is revealed, which most operators use to set their mid-contract price increases for customers. Analysts have estimated that this year’s round of price rises will add almost £500m to consumers’ collective bills from spring. #BT, #Vodafone, #Virgin-Media #O2 and TalkTalk all use a version of the mechanism, which usually takes the consumer prices index (#CPI) measure of inflation plus about 3.9%. However, Virgin Media O2 uses the higher figure of retail price inflation (#RPI) taken from the rate published for January. Last year, most mobile and broadband tariffs rose by 14.4%, although Virgin Media O2 customers faced a 17.3% rise, based on December 2022’s CPI figure of 10.5% and January 2023’s RPI at 13.4%. This year the expectations are that December CPI will be about 4% with January’s RPI forecast to be in the range of 6.5%. The move, which comes months before a ban from the telecoms regulator #Ofcom on companies imposing inflation-linked price rises in the middle of a contract, will put pressure on BT’s rivals that use the practice to follow suit. “Our annual price change is never an easy conversation to have with customers, particularly when so many people are dealing with the cost of living crisis,” said Marc Allera, chief executive of BT group’s consumer division. “We’re listening, and we’ve taken this on board. [We will] instead offer a clear and simple view of any changes in ‘pounds and pence’.” BT said that in 2025 mobile customers can expect a monthly increase from £1.50, and broadband customers from £3, depending on the specific contract they are on. Research by the consumer group Which? Estimates that telecoms firms will generate £488m from this year’s mid-contract prices rises.

Ofcom has banned in-contract price increases which are linked to inflation or set at a percentage increase. This price structure has been widely used by providers of mobile phone and fixed broadband services. Ofcom's intervention will leave providers free to choose the initial monthly subscription price and they may also increase prices during the contract term. However, in future, any price increases must be set out clearly up-front and must be in pounds and pence. This is in response to our findings that consumers had little awareness and understanding of inflation-indexed price increases and did not have certainty and clarity about future price increases. In terms of consumer harms, we found that inflation-indexed price rises: - Increase cognitive burden and can lead to consumers not finding the best deal for their needs - Limit consumer engagement, which in turn can reduce the effectiveness of competition - Impose unfair financial risks on consumers Periods of high and volatile inflation exacerbate these harms, but concerns about these harms persist even if inflation is lower as it remains uncertain. Personally, it has been a real pleasure to work with great colleagues to introduce these important changes. It will be interesting to see how the market responds to Ofcom's intervention and also to see whether and how regulators outside of the UK take action against in-contract price increases indexing against inflation. https://lnkd.in/epJ8xCN5

Telecom customers must be told upfront in pounds and pence about any price rises their provider includes in their contract, under new consumer protection rules from Ofcom. This means those sneaky 'linked to future inflation rates' mid term price hikes are out. #Telecoms #UKTelecoms #Regulatory #ConsumerProtection #BillingTransparency

📱 Ofcom to ban inflation-linked mid-contract price rises on phones, pay-TV and broadband Phone, broadband and pay-TV companies are to be banned from imposing mid-contract price increases linked to inflation, in a crackdown by the regulator Ofcom. Under plans being introduced in January 2025, Ofcom will force providers to tell customers upfront, in “pounds and pence”, about any expected rises throughout the duration of their deals in a victory for campaigners during the cost of living crisis. The UK’s biggest telecoms providers had inserted terms into contracts imposing annual price increases linked to the consumer prices index (CPI) plus 3.9 percentage points. Most consumers were unaware of the practice, the regulator said. Some operators have been using the retail prices index (RPI), which is typically higher than CPI, plus the same inflation-busting 3.9 percentage point supplement. In December, Ofcom proposed to ban the practice after it carried out a consultation, with the move confirmed on Friday. From 17 January next year, providers must make clear any information about in-contract price rises to customers before they are bound by a contract, to enable them to make an informed choice. Providers must also set out when any changes to the monthly price will occur. https://lnkd.in/eCjkV7Gp

📱💻 UK Telecom Alert: Price Hikes Loom for Broadband and Mobile Users 📈 Millions of mobile and broadband users in the UK are set to face price increases of around 8% due to the recent surge in inflation. Major providers, including Vodafone and Three, are poised to implement these rises as specified in existing contracts, resulting in a potential financial burden for consumers. 📈 Key Points: Magnitude: Price hikes of approximately 8% due to inflation-driven increases, following the Consumer Prices Index (CPI) measure. Affected Providers: Vodafone and Three confirm plans to pass on rises outlined in current contracts, affecting around half of Vodafone's customers and leading to an average rise of less than £1.50 a month for Three users. Regulatory Response: Ofcom proposed banning index-linked rises in December, citing consumer confusion. Consumer Advocacy: Which? describes potential price hikes as "completely unacceptable" and urges providers to reconsider. 🤔 What's Next? BT has become the first major telecoms company to abandon inflation-linked price rises for mobile and broadband customers, while others are yet to announce their stance. The situation raises questions about the balance between operators' financial considerations and consumer welfare. Click the link to watch the video https://lnkd.in/eXT8762U 🚀 #TelecomNews #UKBroadband #MobilePrices #ConsumerRights #InflationImpact #TelecomOperators #Vodafone #Three #BT #PriceRises #ConsumerAdvocacy #BroadbandCosts #MobileBills #Ofcom Stay informed about the latest developments and share your thoughts on the potential impact of these price hikes on UK telecom consumers! 🌐💬

New Ofcom Rules. From January 2025, telecom providers can’t increase prices mid-contract based on inflation. This aims to protect consumers and ensure transparency. Pinsent Masons experts note that telecom companies will face challenges in implementing these changes.

Great news - I wrote a post "License to Print Money" about broadband & mobile companies increasing their prices every year by a confusing RPI+3.9%. Looks like people complained because OFCOM announced they are banning this. Fantastic, let's see what they do now, they'll find a another way to confuse customers. https://lnkd.in/e5jrPknx Original post - "License to Print Money." I think mobile and broadband companies have figured out how to confuse customers and keep increasing prices yearly. They advertise great deals, and in the small print, they say. "Each year, your plan will increase by the Retail Price Index (RPI) rate of inflation announced in February plus 3.9%." They never used to say this, and why 3.9%? Have they had a group meeting to all agree to 3.9%? Where has the competition gone? They rely on customers who can't be bothered to switch because everyone uses the same formula. The government need to look into this.

Telecom Prices Decline: Statistics Canada Report Drives Inflation Lower 📉 According to Statistics Canada, telecom prices are on the decline, playing a role in driving down national inflation rates. 📉 As MPs investigate the affordability of telecommunication services, recent data reveals that Canadians signing up for cellphone plans in February paid 26.5% less than a year prior. This decrease follows a 16.4% drop in January. Furthermore, internet access costs saw a significant decline of 13.2% year-over-year in February, with additional reductions due to special offers from providers. Telecom industry consultant Mark Goldberg notes that these declines reflect both lower prices for services and improved offerings, such as larger data packages and international roaming perks. While overall inflation sits at 2.8%, down from 2.9% in January, cellular and internet services are highlighted as key contributors to this decrease. Despite recent price hikes announced by some providers, industry leaders emphasize that phone and internet prices are indeed decreasing. However, some consumers may not perceive these reductions, particularly if they remain on outdated plans. 🔍 https://lnkd.in/gqmQhYHM Stay informed and share your thoughts in the comments! 🗣️ #Telecom #Inflation #StatisticsCanada #Technology #Telecommunications

🚫 After years of frustration over mid-contract price increases, there's finally some good news for consumers. Ofcom's ban on 'unfair' mid-contract mobile and broadband price rises based on inflation is a big win for customers! This move will provide greater protection and clarity for users, ensuring they don't face unexpected hikes in their bills. It's a step in the right direction towards a fairer and more transparent telecommunications industry. #Ofcom #ConsumerProtection #FairPricing https://ift.tt/Lu96p8t

One of the biggest challenges faced by businesses today is the rising cost of mobile bills. 📈 A business that signed a 3-year contract at £50 per month in January 2022 will now be paying around £71 per month for the same service from April this year until the contract ends in January 2025. Mobile service providers are allowed by Ofcom to increase their prices mid-contract every April to adjust for inflation. A nearly 42% increase since January 2022 can strain any business's finances, especially those with multiple users on similar service plans. Compounding this issue, businesses are also dealing with rising costs for fuel, energy, and wages due to the ongoing cost of living crisis. If you can relate to these issues, get in touch with us at Omni Communications, and let’s work together to find a solution that fits your business needs. #MobileCosts #Inflation