ASA Probe Broadband ISP TalkTalk Over Mid Contract Price Hike

The UK Advertising Standards Authority (ASA) has confirmed that they’re investigating budget broadband provider TalkTalk after the ISP announced a price hike earlier this year (here), which somewhat controversially also hit some customers who had previously signed-up under the promise of “no mid-contract price rises“.

Annual price hikes are fairly common among all of the largest providers in this market. This is because they’re frequently adding all sorts of new services (e.g. FTTP etc.), running big first term discounts, adapting to new rules (e.g. automatic compensation) and developing new systems (e.g. improved switching). Consumers are also gobbling significantly more data, which has been further boosted by COVID-19.

Most of the price increases affected customers on their legacy packages who would be out of contract, but we later discovered that some more recent customers on their slower “fibre” (FTTC) plans – Fibre 35 and Fibre 65 – who signed-up BEFORE 1st March 2021, would also be hit.

The issue is that some of those who joined or upgraded just before March had done so after seeing the same packages being promoted as offering “no mid-contract price rises for the duration of your contract – guaranteed,” or similar language, in various promotions (TV, email etc.).

In June 2021 TalkTalk began informing many in this group that they too would face a price rise from this month, which obviously hasn’t gone down well (MSE examples) and that has prompted complaints to the ASA, which is now investigating.

A Spokesperson for TalkTalk said:

“Over this extraordinary last year, we’ve seen broadband usage soar by 40% and we’ve had to invest heavily in our network as a result. Unfortunately, this has meant that, alongside other ISPs such as BT, Virgin and Sky, we have had to raise our prices.”

The situation is embarrassing for a provider that, in late 2019, made a big song and dance about its support for Ofcom’s fairness commitments on pricing for consumers (here). Nevertheless, we suspect they won’t be too concerned about the ASA probe, since the worst that the advertising watchdog could do is ban the related adverts and say they’ve been a bit naughty.

One problem above is that the adverts have already stopped because, since the pricing announcement, TalkTalk no longer promotes “no mid contract price rises” as standard alongside their products. Instead, those who want such a feature will need to optionally take their paid Fixed Price Plus add-on.

The good news, if you’re affected by this problem, is that you should be able to leave your contract penalty free. Unfortunately, TalkTalk’s stance is very much reflective of a historic problem with big broadband ISPs in the UK, where pricing policies often change like the wind.

Most recently, many providers adopted a CPI (inflation) + 3-4% style annual increase which, while more transparent, could be brewing up trouble for the future if inflation surges to c.4% by around the turn of the year (a 7-8% price rise will not go down well). If that happens, then we suspect those pricing policies may have to change.. again.