Broadband price to rise with inflation next year – ‘Axe increases’

Mordaunt refuses to say if benefits should rise with inflation

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Experts are sounding the alarm that many broadband providers will increase their mid-contract prices from April 2023. As it stands, 25 million mobile users and 10 million households on broadband deals will see their bills go up next spring. Two of the country’s leaders within the UK broadband industry are urging providers to “axe above-inflation increases” in light of this.

Households across the nation are currently dealing with an unprecedented cost of living crisis.

One of the contributing factors to this economic downturn is the UK’s rising inflation rate which has returned to a 40-year high.

The Consumer Price Index (CPI) rate of inflation is at 10.1 percent and is expected to remain high for the foreseeable future.

Most broadband providers use the CPI inflation rate to determine the rate hike for their goods and services, with some adding an extra four percent on top of this.

A recent survey carried out by found that four in five consumers believe mid-contract mobile and broadband price rises are unfair.

Some 27 percent of consumers polled admitted that an increase of £5 to their monthly broadband or mobile bill would cause them stress.

Furthermore, more than two-fifths believe mid-contract price rises should be stopped.

Despite the pending wave of inflation-hiked prices, some broadband providers are stepping up to help consumers at this time.

Giganet and Cuckoo are among the companies which are calling for above inflation price increases to end within the broadband industry.

Both have frozen their prices to assist customers during the cost of living crisis as access to broadband is considered an “essential utility” for many.

Jarlath Finnegan, the chief executive officer at Giganet, said: “This has been a tough year, with people across the country having to cut costs and rein in spending in order to survive the cost-of-living crisis.

“Broadband is an essential utility in the same way water and energy is, so the industry has a responsibility to respond and show its customers that it can, and will, support them through the challenges ahead by changing the way it does business.”

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Alexander Fitzgerald, the CEO of Cuckoo, added: “People need to be able to plan their finances and at the moment everywhere they look prices are rising.

“10 million households on broadband deals are facing hikes next spring. Providers must do the decent thing – scrap the exit fees and axe above-inflation increases.

“Most broadband customers are tied into long contracts.

“Many won’t have read the small print properly and won’t realise they face an annual increase tied to the Consumer Prices Index with another four percent whacked on top.

“Then when they do realise and try to leave for a better deal, they run into the brick wall of exit fees.”

The broadband expert outlined how providers determine the costs and rate hikes for their services.

Mr Fitzegeral explained: “These can be hundreds of pounds. Broadband firms use opaque methods to calculate the fees – meaning customers aren’t sure of how much they could have to fork out.

“At Cuckoo, we can’t say we’ll never raise prices, but we will always be honest and transparent – and we will never tie people into opaque contracts with extortionate exit fees.”

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