Yahoo Finance Millions of BT, Vodafone and Three customers face a £50 broadband and phone price rise
Millions of phone and broadband customers are in line for inflation-busting price increases that will add more than £50 to the average annual bill.
Households with BT, Vodafone and Three internet and mobile contracts face a 14.4pc rise in spring after the Office for National Statistics (ONS) said inflation remained firmly in double digits.
The telecoms companies currently link their contracted price rises to the Consumer Price Index (CPI) rate published in January, which reflects inflation rates in the 12 months to December.
This morning's official data showed a slight slowdown in the rate of inflation, but it remained in double figures at 10.5pc. The mobile companies then add a further 3.9pc to the topline rate.
The average UK household spends £30 per month on broadband, meaning a typical household will see their bill increase to £34.32 per month, or £51.84 extra per year, barring any last minute changes by telecoms companies.
This morning, BT said consumers on its basic tariff packages would not have their bills increased this year, keeping 3m customers frozen.
Ernest Doku, a telecoms expert at Uswitch.com, said: “Millions of mobile and broadband customers will now know the scale of the bill increases they face this spring.
“Providers often link their annual price rises to January’s consumer price index (CPI) or the retail price index (RPI). Despite a slight easing this month, both are near the highest they’ve been for 40 years, with the latest CPI at 10.5pc and RPI at 13.4pc.
“This means many telecoms customers can expect to see their mobile and broadband bills rise by at least 14pc in April.
“For example, a household receiving their broadband from BT currently on a £30-a-month contract will see their bills rise by more than £50 a year from the spring."
The average combined fibre and home phone package is £39.75 per month, according to data from uSave, meaning an increase to around £45.47 per month or about £66 extra per year.
A typical BT "fibre essential" deal could increase from £28.99 per month now, to around £33.16 in April. A customer on a Vodafone SIM-only 5G mobile contract that costs £25 per month would increase to about £28.60 come April.
BT said its price increases were needed to keep up with the fact that consumers were using up to 50pc more data every year.
Nick Lane, BT's managing director of customer services, said: "This price rise won't apply to all customers, however. We are freezing the price of line rental, call packages, call charges and call add-ons for our landline-only customers."
Packages that will be frozen at 2022 prices included its home essentials package, EE mobile basics, pay-as-you-go, BT basic and home phone saver deals.
Customers at Three will see their bills increase by the same rate from April, the company announced last year. PlusNet and EE also use the same model. TalkTalk increases prices by CPI plus 3.7pc.
O2 uses a different mechanism. Its prices will increase based on data published in February using the Retail Price Index, which is marginally higher than CPI. O2 only increases the cost of mobile data and calls, while the handset price remains constant.
A spokesman for Virgin Media O2 said Virgin had not yet announced how much its prices will increase by. A Vodafone spokesman said the company had not confirmed its final price increases. A BT spokesman did not immediately respond to a request for comment.
Mobile companies have risked the wrath of regulators with their price increases. Regulator Ofcom has launched an investigation into whether the companies were "clearly upfront" with customers on the fact their monthly fees could rise in the middle of their contracts.
In December, Ofcom said that following “consumer complaints… we are concerned that some price variation terms in consumer contracts entered into between 1 March 2021 and 16 June 2022 may not have been sufficiently prominent and transparent”.
BT insisted at the time that its price rises were "clear and predictable".
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