Over 40 Percent of UK People Feel Broadband ISPs Mainly Raise Prices to Boost Profits
New research from Ipsos UK, which interviewed a representative sample of 993 adults across Great Britain during early March 2025, has claimed that Brits are increasingly cynical about the motivations of utility companies and broadband/phone providers when setting annual price increases – with over 40% believing these industries are mainly raising prices to boost profits.
Firstly, it’s important to highlight that not all communication providers play the mid-contract hikes game. A good number of ISPs, particularly smaller players and many alternative networks, often adopt much more static pricing that rarely changes or at least won’t change during your minimum contract term. But sadly, some providers, particularly most of the largest players, do engage in mid-contract hikes, which often rise above the level of annual inflation.
Providers that engage in the mid-contract hikes game often argue, somewhat correctly, that they are not immune to many of the same cost increases that have hit consumers in recent years. In particular, many of them face rising costs due to high interest rates / inflation, higher charges from suppliers, electricity, leases and the cost of adding all sorts of new services (e.g. FTTP builds) and catering for new regulations etc.
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However, it may also be reasonable to say that the desire for greater profit is a factor too, which certainly seems to be the view of many respondents to the new Ipsos UK survey. When it comes to assigning blame for price rises, Britons are cynical about the motivations of utility companies and broadband/phone providers. Just over two in five (43% and 42% respectively) believe these industries are mainly raising prices to boost profits, rather than simply covering their own increased costs due to inflation.
Consumer who are hit by mid-contract hikes could alternatively try haggling for a lower price when the notification drops (Retentions – Tips for Cutting Your Broadband Bill), although your mileage may vary (big providers will be more receptive). Meanwhile, those on benefits (Universal Credit etc.) also have the option of taking a cheaper Social Tariff – see our Quick Guide to UK Social Tariffs.
In addition, Ofcom’s new One Touch Switching (OTS) system has also made it much quicker and easier to switch providers, but just make sure you aren’t going to be penalised by any early contract termination or exit fees before doing so (this should not be an issue if you’re already out of contract). On the other hand, a growing number of ISPs do offer contract buyouts (welcome credits) to those who wish to exit their existing contracts early.
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Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and Linkedin.
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I don’t disagree with that, while I do release that costs increases, for these companies, energy prices, and now with the government pushing more costs via the NI onto them, they have to rise prices to keep in profit. But sometimes the costs goes up way too much and we as the consumer are not getting anything more for it.
But saying that, going back a few years ago, say, 25, some of us were paying more for 512Kb/s connection via ADSL.
So in one way we are getting more for our money, but it is the pushing for silly speeds that many people don’t need or want and then push the price up for them that is the problem.
It will get to the stage where the choice of going to a lower speed to save money will be gone.
If these increased costs are the issue, why do they need to put my price for Gig2 up from £84 to £90.30, yet a new customer pays £69.99?
Surely the costs are the same?
Interesting to read that the public mainly think that energy companies raise prices to increase profits.
This is despite 90% of retail energy companies going bust in Covid and the fact that petrol and diesel are both around the same price / litre in £ terms as 12 years ago I.e. fuel is significantly cheaper now in real terms.
As for the broadband / mobile price rises, the idiotic policy of Ofcom in response to a one off event (Ukraine / Covid driven inflation) means that bills are rising 7% every year in many cases.
Those companies went bust because they gambled upon the energy spot market always being cheaper than supply contracts.
Come the invasion invasion of Ukraine and the ensuing energy crisis they could no longer buy for less than than the price of the energy cap.
They were then forced out of business and their customers were bailed out by the government.
Many people, and it seems to be a growing problem, have become reliant on on public sector funding for their lifestyle and employment so they have little experience of what is involved in running a commercial business and end-up with a skewed view of the world.
I think you mean many companies are being subsidised by public money that needs to be given to staff due to under paying a living wage.
A simple check of the numbers would show that BT for example is making the about the same level of profit as it did in 2008. This failure to increase its profits is reflected in the lacklustre performance in its share price over the same period. This just shows that public opinion surveys are of little value and lead to misconceptions.
So the other 60% were stupid then. In the case of VM, it’s to pay debt AND fund takeover of ALTNETS to erase competition as well as the CEOs group getting higher salaries. Didn’t see it in terms of fixing O2 or VMs coax network either technically or customer service improvement. Guess the magic 2028 will be the year to see if all those increases actually delivered the promised full fibre network in areas currently coax or RFoG….
VMO2 were building in Banbury last year and according to the Think Broadband maps it’s still RFoG so don’t get your hopes up.
If the price were to rise from (say) £40 to £43 the next year and £46 the year after, for *all* customers, that would be fine. That would be inflation.
But in practice, after 1 year they’re still selling the service to new customers for £40, and after 2 years they’re still selling the service to new customers for £40 (or less). In reality, in the ISP business, some costs are going up but some are going down.
Once you’ve signed, you’re locked into an escalator of price rises which don’t reflect this reality. They are there purely to hide the true cost of what you’ve committed to over the contract period.
I still don’t get why the companies don’t just average out the would be prices rise, which they now display in advance, and then promote themselves as having mid-contract no price rises.
Even if the overall cost is the same, chances are people will feel like it’s less greedy than mid contract.
It’s because every time this is studied a firm majority of consumers will opt for ‘lower price now, higher price later’ even when it’s explained that the overall cost is higher.
Where inflation is high the TVOM (time value of money) formula suggests they might actually be right to do that in some cases.
But in general – ISPs sell products at prices that customers have a propensity to buy at.
It’s profit. Hence why for example, on VMs user forums that their staff answer, you see elderly and vulnerable families post that their relatives out of contract are being hammered by yearly increases for package prices that are way over the list price for out of contract.
Some of the posts are shocking like one who just had TV was over £100 a month, no mobile, no premium channels, no netflix, no broadband as was on an older TiVo box that didn’t need separate broadband.
The family only knew when the relative discussed it in passing comments about cost of things. The woman was old school and eight something. Not just a one off either… The system just keeps upping the price every year without checking if someone is over the out of contract list price. Those out of contract prices are alarming too compared to competition. Now that’s milking of any customer in that position let alone elderly or vulnerable….
My contract is up in June with Virgin Media. I strongly oppose mid contract rises and will vote with my feet by moving to one with no in contract rises. There are many out there that don’t do this greedy practice
I 100% agree.
I was an early adopter of Gig2 from Vermin Media, and the symmetric addon. 6 months of my contract left. I’m paying the full price of £84+6. There were no offers on it at the time.
My price is now going up 7.5% (on the base 84) so £6.30. Newer customers don’t pay RPI based rises so are going up less, on a much smaller monthly price (due to discounts)
New customers pay £69.99 for Gig2.
Yet they tell me they need me to pay £90.30 (plus £6 for symmetric) for the same service in order to fund the network due to rising costs?
Makes no sense. Just be honest and tell me you want my money.
Frustrating as it is they’re doing exactly what you agreed to when you signed up.
If you can’t honour a price for 2 years then you shouldn’t offer a 2 year deal at low prices to begin with, doing so is dishonest. This allows the providers to con people at the start of the contract with attractive prices only to lock them into a spiral of increases. As said by others, it’s a loyalty con. Keep hiking costs for people reluctant to switch (often the elderly and vulnerable). Mid contract increases should be banned, if low prices cause issues then don’t offer long term contracts, or offer sustainable prices for the term on offer. I stay clear of any company bloating their prices whilst I’m tied in, vote with your wallet.
Yes, costs are increasing, it’s called inflation. However, providers adding a percentage on top of the inflation measure, to me, is just all about increasing profits. I wish more would go back to not doing mid contract price increases as that would be easier for me to budget.
OFCOM not banning mid contract price rises seems rather short sighted to me.
That’s literally every price hike in the last 5 years. Fuel, groceries, insurance, they’ve all increased, and company profits have soared.
Virgin media are well known for this crap, they raise the prices of their services too much and then use dumb excuses e.g. CPI inflation to charge more.
Screw Virgin media (honewtly)
I’m contract and out of contract (though in contract is worse now as most contracts no longer recognise this as a right to exit) price rises are to do 2 things.
1. Drive revenue to meet shareholders expectations on the financial return forecasts
2. Churn customers to encourage us to essentially vote with our feet which will see us coming back in the future
It’s because financial performance and customer acquisition are both key, and price rises help both.
When you factor in altners being able to offer 900Mbps symmetrical service for sub £30, it skews the perception of consumer cost and value in the market. That plus out of contract rises (or end of contract price rises) all support much better regulation needed.
These polls shouldn’t legally be allowed to even get printed, less than a thousand participants in a country of over 64m people and apparently
40% of UK people think whatever
40% of the 900 UK people asked thought this would be much more accurate and equally as irrelevant, polls with as few participants as this are not worth the time it took to ask them
There are very well established facts around what number of people you have to interview to get a statistically valid response. You not understanding them doesn’t change those facts.
Calling for the publication of results to be made illegal solely on the basis that you don’t understand the process for producing them is wild.