The British public face being hit by price hikes later this year, with telecoms firms confirming the rates of their mid-contract price rises
Mobile and broadband customers are bracing for price hikes of up to 13% as telecoms firms start confirming mid-contract price rises effective from April 1. The new rates will differ from previous years following Ofcom’s new regulation introduced at the beginning of the year.
It requires telecom companies to show their mid-contract price increases in actual pound figures rather than linking them to inflation. It is designed to boost transparency and clarity for customers about expected price rises and their timing.
Under this revamped system, Virgin Media users will face a hike of £3.50 starting April, while Vodafone subscribers will see an increase of £1.80 per month. These adjustments, however, will only affect customers who entered into contracts on or after January 9 and July 2 for the respective providers.
On the other hand, those who signed contracts before the implementation of the new policy may still experience inflation-based price surges. Uswitch said: “Under new Ofcom rules, anyone who signs up for a new broadband deal from January 17 2025 will instead be on a fixed annual price increase, which isn’t tied to any inflation figures.”
When new rules came into place
Some of the biggest mobile and broadband providers brought in the pounds and pence rule early ahead of Ofcom’s official deadline. This means if you took a contract on or after the respective date, you will not be hit by inflation-linked price changes.
How much your mobile and broadband bill could increase
While customers who signed up before the cut-off dates will still likely see inflation-linked price rises, this may not be as bad as previous years as inflation rates have eased significantly. Furthermore, different companies will use different rates of inflation. For example, Virgin Media/O2 uses the Retail Price Index (RPI) while Vodafone uses Consumer Prices Index (CPI) rate of inflation.
Vodafone
Customers who took out a pay monthly plan between August 11, 2021 and July 1, 2024 will be subjected to an increase by the CPI plus 3.9%. For example, if the CPI rate was 4% your monthly charge would increase by 7.9%.
Vodafone provides the following examples:
- From £10 to £10.79 per month.
- From £20 to £21.58 per month.
- From £30 to £32.37 per month.
- From £40 to £43.16 per month.
However, if you took out a plan after July 2, 2024, you will instead see a price increase of £1.80 each year.
Virgin Media
Virgin Media typically uses the January RPI to adjust its mid-contract price rises. For instance, January’s RPI of 3.5% (plus a flat 3.9%) would see a £25.99 monthly increase go up to £27.91 in April.
However, if you entered into a contract with Virgin Media from January 9, 2025, you will instead see a flat increase of £3.50 per month. As a result, a £25.99 per month contract would rise to £29.49 per month – a percentage increase of 13.46%.
O2
Similarly, O2 customers who took out a contract before January 9 with an Airtime plan will see their bills increase by £1.80 for voice plans and 75p for Data Only and Smartwatch Plans.
