Broadband bills on the rise – calls to ‘scrap exit fees and above-inflation’ price hikes

Martin Lewis explains how to cut costs on broadband bundles

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Reports suggest that broadband price rises will cost UK households more than £100million a month, the equivalent of £1.3billion a year. On top of this, the majority of broadband providers have hiked their exit fees for consumers who leave contracts early. This is leaving households stuck in pricey contracts as inflation is continuing to skyrocket to a 40-year high.

However, some broadband providers are bucking the trend and are calling for more to be done to assist individuals struggling with the cost of living crisis, who are in need of quality broadband.

Alex Fitzgerald, the CEO and founder of broadband provider Cuckoo, believes not enough attention is being drawn to the “above-inflation” price hikes.

Speaking exclusively to, Mr Fitzgerald explained: “The most important thing is to raise awareness on the issue. In the chaos of the cost of living crisis, the above-inflation price hikes that major broadband providers just implemented have gone largely unnoticed.

“Unfortunately, a lot of Brits are stuck in long-term contracts with extortionate exit fees, but it’s tough to bring about change if only a small number of people are aware of the problem. Right now we need to spread the word as far and wide as possible. 

“People should be talking to their friends and family about this – find out if they’re aware of the price increases, get them to check the small print in their own broadband contracts.

“The next step is to engage their providers and demand they do the decent thing – scrap their exit fees and above-inflation increases.”

Earlier this week, media regulator Ofcom announced new rules ordering providers to give consumers clearer information when they take out new contracts.

As part of the new guidance, contracts will include a summary with illustrative examples of mid-contract price hikes, showing the real impact on future bills in pounds and pence.

This will give clarity to consumers and show how inflation is impacting them in the long-term.

As well as this, it will be easier for broadband customers to leave their contract without paying a penalty if their provider hikes their rates to an amount which was not previously agreed to.

However, Mr Fitzgerald does not think this goes far enough in tackling the pressures being placed on consumers.

He added: “This is welcome news of course, but it can only have an impact if people are aware of their rights in the first place, and this is where tighter regulation is needed.

“The major providers use opaque methods to calculate their fee increases and then bury the consumer’s right to leave early in the small print of their contracts – this practice is blatantly designed to confuse and overcharge customers.

“It’s terrible because Brits are being truly stung by these unreasonable rising costs. For many households it’s an absolute price prison.

“It’s time for all providers to do right by their customers and stop taking advantage – and Ofcom needs to step up and close the loopholes that have allowed this daylight robbery to continue for so long.”

While the issue of inflation is one which cannot be controlled by broadband providers or regulators, Cuckoo’s founder explained why he thinks tackling the continuing price hikes should be a priority for all companies in the industry.

“With each bill, we give our customers an honest breakdown of where their money goes, including the network, service and marketing costs of their broadband connection and the small percentage we take as profit,” Mr Fitzgerald said.

“At Cuckoo, we can’t say we’ll never raise prices, but we will always be honest and transparent – and we will never tie people into opaque contracts with extortionate exit fees.

“That’s why Cuckoo is campaigning to end the price prison. We want to raise customers’ awareness of these shady industry tactics and pressure the major providers to change.”

An Ofcom spokesperson: “While we generally can’t cap retail price rises, we’re concerned about their impact on households who can least afford them. That’s why we’ve been putting pressure on telecoms firms to do more to support customers suffering financial hardship. We believe there’s a moral imperative on all providers to offer special discounts – or ‘social tariffs’ – to people on low incomes.

“We already have strict rules in place that mean companies must set out price rises clearly before customers sign up, and cannot just include them in the small print. If there is evidence that a provider failed to do this, customers can complain to them and then escalate to an independent ombudsman. And we’ve recently strengthened our rules, so customers now get a straightforward example of how of how monthly prices will increase over the course of the contract, before they sign up.

“Millions of people could cut they bills today – either by switching to a social tariff if they’re in receipt of certain benefits, or by signing up to a new deal if they’re out of contract. So we’d encourage everyone to check what’s available to them.”

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