BT has announced it will no longer adjust prices based on inflation percentages, in anticipation of Ofcom’s potential prohibition of this approach. Starting from the upcoming summer, BT plans to adopt a pricing strategy that clearly outlines any adjustments in terms of actual currency amounts, aiming for transparency with “pounds and pence.” This new model predicts a £3 monthly increase for broadband services and a £1.50 rise for those renewing mobile contracts. Marc Allera, who leads BT Group’s Consumer Division, likened the adjustments to the cost of a coffee per month, emphasizing that, in practical terms, customers are paying less for broadband now than ever before while receiving significantly more value.
Despite this shift, BT intends to apply the current pricing formula one last time for the forthcoming April price hike, leading to a 7.9% increase—reflecting January’s CPI inflation rate plus an additional 3.9%. This move comes ahead of Ofcom’s final decision on banning mid-contract price rises tied to inflation, with the regulator currently engaging with stakeholders for input before making its determination this spring. Complaints about such pricing models have surged over the past year, according to Ofcom. Its findings indicate that a mere 16% of broadband subscribers were aware that their bills could rise mid-contract in relation to inflation and an extra percentage.
Remarkably, all leading broadband providers, with the exception of Sky, have now implemented this method for price adjustments. Allera also assured that there would be no price increase for “customers in financially vulnerable situations” who are subscribed to EE Basics or BT Home Essentials plans. As of now, no other internet service provider has disclosed their approach to managing price increases in the wake of Ofcom’s impending regulation.
