The annual broadband price hikes have become the reality for millions of UK households over the last few years. It seems as though every spring, homeowners are met with another round of price hikes, which are typically between 6% and 7.5%. Although Ofcom’s new regulations improve transparency, the financial strain on customers still weighs heavily on households.
But is there anything you can do to mitigate the price hikes? In this article, we will discuss the key impacts as well as tips on how to get the best full fibre broadband company deal.
Why are broadband prices increasing?
According to broadband providers, annual price hikes are necessary to cover inflation rates, which usually come at approximately 4% as well as any other rising costs. As a result, they increase prices to maintain their own profitability. However, while it can be justified, the way broadband companies handle this is often considered sneaky, announcing unexpected mid-contract changes that consumers simply cannot get out of.
To stop this, on 17th January 2025, Ofcom enforced a new ban, which prohibits the broadband providers from doing mid-contract price hikes altogether, unless they are clearly outlined. This means that customers will know about upcoming fixed increases in advance, stated clearly in pounds and pennies. However, these fixed increases often exceed current inflation rates, leading to higher overall costs for customers.
How does it impact customers?
Broadband price hikes are a financial burden that affects many households, particularly during a cost-of-living crisis. The monthly cost increases may not seem like a lot; for instance, an approximate 7% increase will result in an additional £3 per month, which adds up to around £36 per year on average. However, when considering other bills like energy and council tax, which have also been increasing, it adds up to a considerable amount altogether.
Not just that, mid-contract hikes offer very limited flexibility to consumers, even if they are disclosed upfront. Broadband providers usually have cancellation fees or penalties that restrain the customer from leaving their contract early, which means they are locked in to whatever price increased they are given.
What can you do about it?
Firstly, always review your broadband contract carefully, reading any clauses related to price increases. It’s illegal for the company to not disclose it, so any price hikes should be clearly outlined. Depending on the contract, you may also have the right to cancel within 30 days of notification about increases, without penalties. Knowing what your rights are in this situation is incredibly important, so make sure to educate yourself.
Additionally, switching to a more affordable provider is always an option. Keep in mind that the large and well-known organisations are generally more likely to have annual price hikes. This is because they also have higher outgoings, like marketing costs and in-store customer service staff. If you opt for a smaller full fibre broadband company, you are much likely to get a better deal. Look for a provider that states no mid-contract price hikes, as well as offers good deals for new customers.
If you are stuck with your current provider due to a long-term contract, remember that you can also negotiate. Call them on the phone and discuss your options, expressing that you are unhappy with your current deal and considering leaving the contract. Some providers may be able to offer alternative packages or discounts that could reduce the rates.
Evaluating your options
Price hikes are not going away so, unfortunately, it is up to the customer to find an affordable broadband deal. The best thing you can do is not settling for anything you are not happy with. Do your research, compare your options, and you will be more in-control of your expenses.
