UPDATE UK ISP BT Unveil Broadband, TV and Phone Price Hikes for 2016

The retail division of BT has, in an earlier than expected move, today unveiled a raft of new inflation busting price hikes (increases range from +5.6% to +20%) for their consumer phone, TV and broadband services that will come into force from 3rd July 2016. Line rental is now £18.99 a month.

The provider usually announces their annual changes a little later than this. For example, back in 2015 BT announced them in July and introduced them for September, then in 2014 they unveiled them in August and introduced the rises from December (note: new subscribers usually get hit with them much sooner). Suffice to say that it’s been years since they jumped ahead like this.

On top of that it’s worth pointing out that annual inflation, despite once being used as an excuse for such large increases, will have had little impact this year with the CPI 12-month rate (the amount prices change over a year) between March 2015 and March 2016 standing at just 0.5% and RPI pipping to 1.6%.

However BT also needs to account for the costs of rapidly rising broadband data use, bringing customer support back to the UK, expensive premium TV rights deals (Sport etc.), future investment in other areas (4K TV services etc.) and the introduction of new Government policy / requirements, which need to be balanced somewhere.

The Changes

As usual the underlying wholesale cost of copper line rental has tended to hold fairly steady at below £10 +vat per month and it’s been that way for a long time, although ISPs often shift some of their other costs on to line rental and naturally it’s the one that affects the most subscribers.

History of BT Phone Line Rental Rises
2011 = £13.90
2012 = £14.60
2013 = £15.45
2014 = £15.99
2015 (Dec 2014) = £16.99
2016 (September 2015) = £17.99
2016/17 (July 2016) = £18.99

Similarly BT’s pre-paid Line Rental Saver service (i.e. pay 12 months line rental in advance in order to get a small discount) will also increase from £194.28 to £205.08 per year, which equates to a monthly equivalent price of £17.09. However the cost of the BT Basic social line rental tariff for those on low incomes will remain at £5.10 per month.

Unfortunately some of the increases elsewhere are even more aggressive. For example, the standard broadband package price jumps by over 15% from £13 to £15 per month, with their superfast “fibre” BTInfinity (FTTC) options also seeing increases of between +£1 and +£3 per month extra (this reflects the prices after any promotional discounts).

Anybody wanting the Anytime UK Calls add-on will also find themselves paying £8.50 a month instead of the current £7.95 and the premium BT Sport Pack TV add-on will see a massive +20% jump from £5 per month to £6 per month.

Customers may also like to note that the Pence Per Minute (PPM) price for calls to UK landlines and 0870 numbers is also increasing from 10.24p to 11p and land-line call set-up charges are similarly long jumping from 17.07p to 19p. Some other call charges may also rise, but BT haven’t yet sent us a complete summary and so we can’t verify.

John Petter, BT Consumer CEO, said:

“We realise that customers never welcome price rises, but we have again ensured that low-income customers avoid increases. And we continue to highlight money-saving options for all customers. We have also done our best to ensure that all of our customers will get more value if their price is going up, and we know they want faster speeds and better online security from their broadband.

But we know that customers also want great service and to be protected from nuisance calls. That’s why we have invested to be able to promise that we’ll answer 80% of our customers’ calls in the UK by the end of this year.

And we will also be launching a comprehensive defence against nuisance calls that will divert up to 25 million unwanted calls a week before they ever bother BT customers.”

As usual BT’s rises tend to trigger most of the markets other major broadband and phone providers to follow suit, albeit gradually over the next few months. At the same time Ofcom’s regulation against mid-contract price hikes allows customers to exit their existing contract without penalty after receiving the price notification letter.

UPDATE:

Incidentally BT has also reduced the price of their unlimited broadband and phone bundles today by a few pounds, although this is a promotional offer (not standard pricing) and the above changes aren’t yet being reflected on their website (that usually follows a little later).

UPDATE 2:

After a bit of checking we can now confirm that BT have moved to soften the blow by making a number of changes, with the key ones being as follows.

* Existing BTInfinity 1 (FTTC) customers (all 1 million+ of them) with a download speed of up to 38Mbps will now be offered a “free speed boost” to 52Mbps.

* More than a million broadband customers “will each get a free upgrade to Unlimited usage or a higher allowance” (worth between £43 and £108 a year), although BT don’t spell out precisely which packages this applies too.

* All broadband customers will get free BT Net Protect security software, which was previously only “free” on their more expensive packages.

This year BT are also promising to fix line faults faster for all of their voice and broadband customers by “upgrading them to a higher level of service, which means we will send an engineer 24 hours faster than before, if a home visit is needed“.