ISP Sky Broadband and NOW Launch Cheaper UK Social Tariff

Good news. UK ISP Sky Broadband and sibling NOW Broadband have today become the latest internet providers to launch a cheaper “social tariff” for home broadband and phone connectivity, which is being offered to consumers who are claiming Universal Credit or Pension Credit.

The Government and Ofcom have spent the past two years trying to encourage more ISPs to proactively introduce or upgrade and promote low-cost social tariffs, which are usually aimed at those in the most disadvantaged groups (i.e. low income, unemployed etc.), who may be struggling to pay their bills.

Ofcom has also repeatedly warned of further action if internet providers fail to put more effort into tackling this issue, which they said could include the potential introduction of an industry-wide regulated social tariff. But so far that hasn’t happened and the focus has instead remained on the tedious task of raising awareness, which appears to be the main roadblock (here).

At present a number of ISPs currently offer social tariffs, including BT (Home Essentials), Virgin Media (Essential Broadband), Hyperoptic (Fair Fibre Plans), KCOM (Flex) and G.Network (Essential Fibre). But the good news is that they’ve today been joined by the new ‘Basics‘ package from both Sky Broadband and NOW Broadband.

What is Sky Broadband Basics?

Sky Broadband Basics costs £20 a month for 18 months, which includes average download speeds of 36Mbps (FTTC / FTTP – uploads of c.8.5Mbps) or – if “fibre” isn’t available where you live – customers will instead receive Sky Broadband Essential Plus, with average download speeds of 11Mbps (ADSL – uploads of c.1Mbps). The package also includes standard call rates via Sky Pay As You Talk and a router.

“It comes with a new 18-month contract, but if you need to leave us before it ends, we won’t charge you any early termination fees on your Sky Broadband. After 18-months the price will go back to the standard rate – we’ll tell you what this will be when you get in touch to take Sky Broadband Basics. You’ll also get an email to let you know when the price is coming to an end, and you can get in touch to talk about the options available,” said Sky.

By comparison, NOW Broadband Basics is offering the same price and features, albeit alongside an ongoing monthly contract and, thankfully, there’s NO MENTION of pricing going “back to the standard rate” like on Sky’s offer.

Lindsey Fussell, Ofcom’s Network and Communications Group Director, said:

“We’ve been calling on broadband firms to do more to support customers suffering financial hardship. So we’re pleased Sky has responded with a special discount for people on low incomes. We want to see all providers step up and offer these packages, and promote them more widely.”

Interestingly, Sky’s Basics plan doesn’t quite appear to meet the regulator’s past criteria for a social tariff, due to the fact that the price is more like a special discount and only lasts for 18-months before returning to a “standard rate“. Sky’s page also fails to confirm what the standard rate for Basics actually is – they’ll only do this when you call them, which seems unnecessarily tedious.

Ofcom confirmed to ISPreview.co.uk in February (here) that they require social tariffs to offer pricing stability (i.e. mid-contract price and out-of-contract price increases are not consistent with this), avoid early termination charges and have minimal initial upfront costs. As such, an ISP cannot merely convert an existing package and call it comparable to a ‘social tariff’ without factoring this in first.

We have asked Ofcom to clarify whether Sky’s package is thus still consistent with their approach. Oddly, the Basics plan on NOW Broadband does appear to be consistent.

UPDATE 12:03pm

Sky don’t state this on their website, but the regulator understands that if a customer is still eligible at the end of the 18-month term then they can stay on the tariff (i.e. they won’t be moved to the standard product). Hopefully, Sky will make this clear on the Sky Broadband Basics page.