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Broadband ISP BT and EE Confirm 4.5% Price Hike Rate for 2021 UPDATE

Wednesday, February 10th, 2021 (8:52 am) - Score 8,496
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As expected BT and EE have confirmed that their annual price increase for this year will be 4.5% (effective from 31st March 2021), which reflects their new policy (here) of raising prices by the Consumer Price Index (CPI) rate of inflation – as published in January 2021 (0.6%) – plus an additional 3.9%.

The change in approach, which was first unveiled in September 2020, came as a shock to many because it represented a dramatic change from the policy that had been adopted only a year before (here and here), which aligned their future price rises to the Consumer Price Index (CPI) rate of inflation – without any additional increases like we now see (i.e. in March 2020 the increase was just 1.3%).

BT has now updated their Residential Tariffs document to reflect the January 2021 CPI rate, which was just 0.6% and thus many customers can expect to face an annual rise of 4.5% from 31st March 2021. However, if you were lucky enough to have joined the ISP under their previous terms and those are still active, then you’ll only see an increase of just 0.6% to match the CPI rate.

One advantage here is that BT’s new terms make customers legally aware of future price increases when they sign-up or re-contract (transparency is a good thing). On the flip side this also removes some of the protection afforded by Ofcom’s rule against mid-contract price hikes that go above the level of inflation (i.e. the contract makes you aware of this increase when you join and thus it’s harder to argue for a penalty-free exit).

Naturally, not everybody reads the small print, which is the classic catch in BT’s approach. As such if you’re currently on terms where the new policy applies and still want to switch ISP – without being hit by exit fees, then you’ll most likely be stuck waiting until the end of your contract in order to do that. Alternatively, existing customers could try haggling for a better price (Retentions – Tips for Cutting Your Broadband Bill).

We should point out that a number of other operators, such as Plusnet and Vodafone, have since adopted a similar approach to BT and EE.

A BT spokesperson said:

“Back in September we made some changes to our contract terms as we started to bring all our products and brands in line with a predictable annual increase. We are currently reminding customers that these changes will start from April.

Network usage is doubling as our customers rely on us for connectivity more than ever before, and this small annual increase reflects the investment needed to support growing demand. The average increase for a broadband/ Mobile customer is less than £2 a month, meaning our customers will continue to benefit from the fastest networks, the best customer service and the safest products.”

In fairness, annual price hikes are fairly common among all of the largest providers because they’re frequently adding all sorts of new services, running big first year discounts, adapting to new rules (e.g. automatic compensation), developing new systems (e.g. improved switching) and consumers are also gobbling significantly more data (COVID-19 has had a particularly big impact on broadband usage).

Indeed, BT states that the latest price increase “reflects the increase in the costs to run and invest in the network and service that we provide.” On top of that the impact of COVID-19 has seen Ofcom and the Government put pressure on broadband, phone and mobile operators to help protect vulnerable consumers and school children during the pandemic. But naturally any additional measures or protections ultimately have a big cost (one study put the figure at £940m – here) and, like it or not, that has to be recouped from somewhere. ISPs aren’t charities, they’re commercial businesses.

UPDATE 1:07pm

We’ve added a comment from BT above.

UPDATE 4:36pm

We asked for Ofcom’s opinion on this too.

A Spokesperson for Ofcom said:

“Under our existing rules, such price rises must be set out in a sufficiently prominent and transparent way before customers sign up, and cannot just be included in the small print. And from June next year, people will also get a summary of the main terms of their contract in writing before they sign up, including an example of how any planned inflation increases will affect the price they pay.”

Leave a Comment
36 Responses
  1. Avatar Karl Betts says:

    These companies have some cheek with everything that’s going at the moment COVID-19 !

    1. Avatar Alex says:

      Agreed. They should sacrifice their future viability by holding or reducing prices. To hell with their employees and shareholders.

    2. Avatar Scott says:

      It is a difficult one – however two aspects to consider.

      1. BT/EE have attempted to support people through free data and other support schemes.

      2. Costs are still going up for electric and other consumables. BT are one of the biggest consumers of Electric in the UK – you can’t expect a company to absorb costs forever.

      Generally though – i get where you are coming from but rather than critique it would be better if you’d have suggested something like “With everything that’s going on with Covid-19 it would be nice if there was a sweetener offered whilst prices are increased”

    3. Avatar DaveD says:

      Usage is up 40%, capacity costs money.

    4. Avatar JP says:

      Get it canceled if your that bothered, the only thing keeping the country moving currently and you want to slap them for moving with inflation.

    5. Avatar adslmax says:

      I agreed. But what can we do? The Gas / Electricity going up, Broadband going up, Line Rental going up, Mobile going up, Water rent going up, TV License going up, Council Tax going up.

      Government should ACT now as many of us are struggles with household bills during covid19.

    6. Avatar Ben says:

      @DaveD

      https://newsroom.bt.com/the-facts-about-our-network-and-coronavirus/
      https://www.bbc.co.uk/news/technology-51974866

      From March 2020, so probably has changed by now, but BT have more than enough headroom to handle the increased loads at the moment.

    7. Avatar JP says:

      @Ben – Even if they did have the capacity, are they supposed to run the network at its limit… That’s not BT’s style.

    8. Avatar JP says:

      @JP What I’m saying is they’ve got the capacity so they’re not running it to their limits.

  2. Avatar Peter says:

    I’m sorry but if you sign up for something on a contract then you shouldn’t pay more half way through.

    That’s like buying a car on a monthly payment of £200 for 4 years then being told it’s going up to £210 after the first year.

    If other ISPs can charge fix price then BT could do it also.

    1. Avatar Lewis says:

      BT aren’t hiding the fact that their prices will increase by a specified percentage each year.

      It’s the customers responsibility to read and understand the terms of any agreement or contract they’re signing. Can’t go blaming that on BT. Your car payment comparison is completely invalid as that’s an asset and not a service. There is no comparing them.

      Bottom line is, costs of utilities, materials and wages go up therefore suppliers (in this case BT, especially with such overheads and large employee base) will need to increase costs accordingly to accommodate that. Don’t like it, use your right to choose and go with a provider that guarantees no price hikes mid-contract like you referred to.

  3. Avatar Paul says:

    I hold the government responsible let’s take UC and legacy benefits for example you need to be online to apply and the government know you have no choice in the matter and have the nerve to increase legacy benefits by 37p per week,how are we supposed to pay theses increases.gas electric oil. Ect ect it’s criminal and dam write wrong,I really feel for the hard working families on low incomes and hit by the pandemic,where’s the justice in this .

    1. Avatar adslmax says:

      Tory are a bunch of cow money! Don’t know why peoples voted for Tories! They think a rise of 37p is more than enough to live on!

      MPs getting a fat cat rises!

    2. Avatar JP says:

      HAHAHAHAHA I’m neutral to this as I think they are all ***** but if anybody thinks this would or will be different with another party at the helm they would be mistaken.

    3. Avatar T says:

      Even if they put a dog in charge it would be better than the s**t show now.

    4. Avatar L.E. Vator says:

      JP: The Tories are ideologically opposed to the welfare system. The rolling disaster that is UC is their invention. So your assertion that any other party would be no different is simply wrong.

    5. Avatar JP says:

      @L.E. Vator – mwh

  4. Avatar caracal says:

    Purchasing Power of the Pound continues to decrease
    Nice.

  5. Avatar Treve says:

    The UK in many years to come might wake up to the fact that it’s ok to increase prices but we all pay in the end wages have to increase to keep the comfort they we want prices of products go up to pay those wage increases prices go up because everything around that’s purchased goes up it will never end I dread to think what house prices will be like in 10 years & what wages people will have to be on debt will increase the least wealthy struggling and the wealthy laughing all the way to the bank

  6. Avatar adslmax says:

    Dear BT, Plusnet, EE

    Shut up will ya. Greedy money grabber! I will never joined the big ISP ever again.

    1. Avatar JP says:

      Give them a good reason why they should SHUT UP…

      I see a company/s that have stipulated clearly in their Terms of service that they will increase by yearly fee and/or inflation rate as of xx date.

      Now if you want to moan about a company that that has been somewhat non-transparent about pricing and increases, head over to Virgin’s forum and see the price increase threads where customers get randomly generated price increases without any uniformity.

      Why one customer pays one price and another pays different for the same is beyond me and them.

  7. Avatar Tim Procter says:

    Tory are a bunch of cow money! Don’t know why peoples voted for Tories!
    _______________________________________________________________________

    So you would rather have that idiot Corbyn running the government and Dianne Abbott doing the sums.. hahahahahahahahahahahahaha

    1. Avatar T says:

      I’d rather have my nan run the government than the Tories, she has more sense even with Alzheimer’s.

    2. Avatar L.E. Vator says:

      Don’t you know that Corbyn isn’t Labour leader anymore and Diane Abbott isn’t shadow chancellor? Doesn’t the Sun/Daily Mail tell you these things?

  8. Avatar Paul says:

    I ‘phoned BT Retentions last week to try to negotiate a mid-contract price reduction due to a change in circumstances. I failed. However, I was move onto Compleat Wi-Fi and received a new router and three mini disks at no extra cost.

  9. Avatar At says:

    Greedy c*****

  10. Avatar James says:

    It’s way over the inflation rate and compounded every year – that is quite outrageous.

    1. Avatar Sykez says:

      Exactly.. Plus the cost of corporate borrowing is almost next to zero percent..
      The fact is that realise that we depend on ISP now in modern day living and this is why they know they can squeeze ever more out of their customers..
      Also, CPI / RPI items are all cherry picked and manipulated to suite the companies who pegg their costs increases to +xx.xx% not only that but compounded too YoY..
      I think its wrong to increase costs when the Magority of the country are stuck either on welfare and /or working poor with wages stuck at minimum wage.. It would be a different story if people’s wages kept at pace with these kinds of increases but they do not!
      Things continue to become prohibitively expensive.. It is criminal what goes on in this county.. One of the richest economies in the world…

  11. Avatar Matt says:

    I don’t mind price rises if the service level improves, ie: I get 5G sooner.

  12. Avatar Spurple says:

    I hear Zen is still honouring their no price rises pledge.

    Let’s see if you vote with your wallets.

    1. Avatar A new Zen user says:

      Already did. Moved onto Zen from BT since the 1st of Feb. So far so good 🙂

  13. Avatar Jon asdin says:

    On any BT or EE advert, they should display the price rise in letters/numbers the same size as the initial headline price. It’s not unreasonable to know the actual price when you buy it. Can you image going around the supermarket for your weekly shop, then a week later get a bill for another 10%.. and the shop will say, well it was written on the door as you walked in…

  14. Avatar Simon M says:

    Received a letter from BT today saying the landline/call package is going up by CPI/RPI plus 3.9%, and then saying on the next page that it’s increasing by 0% as we’re still in the minimum term. And goes on to say that out of bundle calls are going up by CPI/RPI plus 3.9%.

    However, we’ve not re-contracted, certainly not since September 2020 so should be on the previous terms of just the CPI/RPI increase?

  15. Avatar Curtis says:

    So does that mean if I joined EE back in August 2020 I can leave penalty free.

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