As many mobile, TV and broadband firms prepare to hike monthly bills by up to 18 per cent this spring, new Which? research finds that customers could save over £250 a year by switching providers.
The consumer champion asked more than 5,000 customers who had their contract end on either their mobile, broadband or broadband and TV package whether they had haggled or switched and how much money they had saved in the process.
Which?’s survey shows that, on average, TV and broadband customers saved £162 by switching away, however those who switched away from Sky saved an average of £261 a year. Those switching away from Virgin Media saved an average of £210.
Even customers who did not switch but took the time to haggle with their broadband and TV provider saved an average of £90 a year, with the same pattern of those with the biggest firms saving most money. BT customers who haggled told Which? they saved an average of £123 a year, while Sky customers saved £102 by haggling.
There were also big savings to be had for broadband-only customers who switched, with the average being £92 – however BT customers who switched away saved an average of £127.
Broadband customers who haggled saved less on average (£43) but again customers with some of the bigger providers often saved more. Those with Virgin Media saved £77 on average.
When Which? spoke to mobile customers whose contracts had ended in the last 12 months it found that customers saved an average of £95 by switching, although customers who switched away from EE saved £184 and those who left Vodafone saved £150.
When it came to haggling, mobile customers reported savings of £62 a year, but the biggest savings were had by customers of Vodafone (£96), Three (£78) and EE (£70).
Alarmingly, Which?’s survey revealed that one in five (21%) broadband customers and one in six (16%) TV and broadband customers did nothing when their contract ended – despite potentially facing a hefty increase as they move from an introductory offer to a pricier standard tariff.
Mobile customers were even less likely to take action with a quarter (24%) of those surveyed telling Which? they had not switched or attempted to haggle.
While no price hikes have yet been confirmed, Which? is calling on all providers to carefully assess what level of mid-contract price rises can be justified in the current cost of living crisis and allow customers to leave their contract without penalty if prices are hiked mid-contract – regardless of whether or not these increases can be said to be ‘transparent’.
Several providers – including Hyperoptic, Utility Warehouse and Zen Internet – already protect customers against inflation by committing to keep customers’ prices the same for the duration of their contract.
KCOM cancelled mid-contract price rises for 2022 due to the rising cost of living. Shell Energy Broadband postponed its 2022 price rises (and increased prices by a lower amount than its contracts allow for when these did go through).
Sky and Virgin Media do not currently employ mid-contract price rises. Both regularly make changes on an ad hoc basis – but when this happens, consumers have the right to switch without penalty.
Natalie Hitchins, Which? Head of Home Products and Services, said:
“While our findings show that out of contract customers can avoid mid-contract price hikes by switching to a new provider or haggling with their current one, those still signed up to mobile or broadband contracts could be hit with price increases that could be as high as 18 per cent.
“Given the unrelenting cost of living crisis, Which? is calling for all providers to allow all customers to exit their contracts penalty free if their tariff does go up mid-contract and that anyone eligible for a social tariff should be allowed to move to one without facing exit fees.”
Notes to editors:
Some broadband providers use the Consumer Price Index (CPI), published in January, as a basis for price rises but add on an extra 3-3.9%. In 2020 or 2021, this meant rises of around 5%, but in 2022 they were closer to 10%. This year CPI is forecast by the Office for Budget Responsibility to be around 10% which could mean prices rises approaching 14%.
Some mobile providers (EE, Three, Vodafone) also base price rises on CPI. But others use the Retail Price Index (RPI), as published in February, which is typically even higher than CPI. O2 and Virgin Mobile add an extra 3.9% on top of RPI. RPI is forecast to be around 14% in January so some mobile customers face increases of nearly 18% this year.
Which? cost of living campaign
The consumer champion recently launched a campaign calling on businesses in essential sectors – supermarkets, telecoms and energy – to do more to help their customers through the cost of living crisis.
Which? surveyed 5,139 people whose broadband, TV & broadband and/or mobile phone contract ended in the previous 12 months. Fieldwork was carried out in October 2022 by Deltapoll.
Previous research – Broadband customers could face hikes of up to £113 in 2023, Which? warns
More info on mid-contract price hikes –
- Ofcom says it wants companies to think very carefully about what is justified during an exceptional period of hardship for many people. –https://www.ofcom.org.uk/news-centre/2022/lindsey-fussell-speech-to-connected-britain-200922
- Ofcom fairness commitments – https://www.ofcom.org.uk/about-ofcom/latest/media/media-releases/2019/broadband-and-phone-firms-put-fairness-first
- Ofcom rules to protect customers from mid-contract price hikes that cause ‘material detriment’ – https://www.ofcom.org.uk/about-ofcom/latest/media/media-releases/2014/protection-for-consumers-against-unexpected-mid-contract-price-rises
Which? is the UK’s consumer champion, here to make life simpler, fairer and safer for everyone. Our research gets to the heart of consumer issues, our advice is impartial, and our rigorous product tests lead to expert recommendations. We’re the independent consumer voice that influences politicians and lawmakers, investigates, holds businesses to account and makes change happen. As an organisation we’re not for profit and all for making consumers more powerful.
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Press Release: bills, broadband, broadband and TV, BT, Cost of living, Haggling, Mobile, Natalie Hitchins, Ofcom, save money, Shell, Sky, switching, talktalk, Virgin media, Vodafone, Which? haggling survey