- Customers pays additional for broadband and cell phone airtime payments
- The agency makes use of the RPI inflation index to set worth rises, not like most which use CPI
- Virgin Media O2 says rise is required and nonetheless represents ‘unbelievable worth’
Broadband and cell prospects of Virgin Media O2 face worth rises of as much as 8.8 per cent from April, the very best will increase within the UK.
Almost all web and telephone payments will rise from March to May this yr as companies go on prices linked to inflation, typically with a further cost on high.
Most companies are placing up these costs by a median of seven.9 per cent, which is the December client costs index (CPI) inflation determine of 4 per cent plus as much as 3.9 per cent as an additional cost.
But Virgin Media O2 is placing up payments by 8.8 per cent from 1 April, the very best of all broadband and cell worth will increase.
In the loop: Virgin Media’s broadband payments are set to rise by greater than 8 per cent
This is as a result of the agency makes use of a unique measure of inflation to base its invoice hikes on – the retail worth index (RPI) measure for January 2024, which was introduced as 4.9 per cent at this time.
On high of that, Virgin Media O2 provides 3.9 per cent, giving a rise of 8.8 per cent.
Virgin Media O2 is made up of Virgin Media broadband, and O2 for cellphones and tariffs.
The agency stated Virgin Media prospects will see a worth rise of a median £4.16 a month, which it defends by saying it’s ’round the price of a takeaway espresso’.
A Virgin Media O2 spokesperson stated: ‘This illustrates the unbelievable worth we proceed to supply prospects for connectivity that’s used greater than ever.’
Meanwhile O2 prospects will see an worth enhance of 8.8 per cent, however solely on the airtime component of their cell payments.
This is as a result of worth rises are solely utilized to the a part of a telephone invoice that pays for information and calls, not the handset itself.
The cell phone agency stated the general month-to-month invoice for purchasers will go up by 5 per cent in actual phrases.
| Firm | Average worth enhance | Applies to |
|---|---|---|
| Virgin Media O2 | 8.8% | Mobile, broadband |
| BT | 7.9% | Mobile, broadband |
| EE | 7.9% | Mobile, broadband |
| Plusnet | 7.9% | Broadband |
| Three | 7.9% | Mobile, broadband ( |
| Vodafone | 7.9% | Mobile, broadband |
| TalkTalk | 7.7% | Broadband |
| Sky | 6.7% | Broadband |
| Note: Social tariffs should not rising in worth, SIM-only deal worth rises will range | ||
A Virgin Media O2 spokesperson stated: ‘2023 was a report yr for site visitors on our networks as prospects used our cell and broadband providers greater than ever.
‘We are investing closely to make sure we proceed to supply the quick and dependable connectivity our prospects depend on, and the quantity we obtain from worth will increase is vastly outweighed by the £5million we make investments each single day to improve our networks and providers to present prospects a greater general expertise.’
However, in step with Ofcom guidelines Virgin Media O2 won’t be placing up payments for purchasers on its social tariffs.
A social tariff is an inexpensive cell or broadband deal solely accessible to struggling households.
These offers should not open to all, and are largely restricted to these on advantages, decrease incomes or the aged.
Most broadband companies depend on Openreach’s infrastructure to ship broadband to customers’ houses, and pay the BT-owned agency a yearly payment.
That payment rises with inflation yearly, in step with Ofcom guidelines, and broadband suppliers would argue their prices must go up by at the least inflation too.
Not solely this, however the companies say {that a} third to 1 / 4 of their prospects see no worth will increase attributable to being on a social tariff, weak or on sure fixed-rate offers.
However, the price to produce these folks with broadband nonetheless goes up yearly in step with inflation, that means companies look to go prices on to different prospects.
But these causes – usually talked about secretively by cell and broadband companies – don’t clarify why a lot of their costs rise by considerably greater than inflation.
Nor do they clarify why the now-common follow of including a cost on high of inflation-linked rises is pretty new, with many suppliers solely adopting this tactic lately.
Alex Tofts, broadband professional at Broadband Genie, stated: ‘In 2023 Virgin Media, like lots of the broadly accessible suppliers, considerably hiked up their costs for purchasers.
‘This yr, it is poised for an additional hefty enhance utilizing the RPI determine, though with inflation easing, the soar is anticipated to be much less dramatic.
‘The kick within the enamel for Virgin prospects is that even when they’re mid-contract, they may haven’t any selection however to swallow the additional price, as leaving could include a hefty exit payment.’