Broadband, TV, phone and mobile provider BT (inc. EE) has today reiterated their policy on annual UK price increases, which readers may recall was first introduced last year (here and here). This is intended to align with Ofcom’s ban on mid-contract price hikes that are linked to confusing inflation and percentage-based changes (here).
Just to be clear. Ofcom’s change is NOT designed to stop mid-contract hikes completely, and is more about making future pricing clearer and simpler. But it does require providers to tell customers precisely what any future price increases would be when they sign up (“in pounds and pence“). This rules out changes to ‘core subscription’ prices that are linked to unknown future inflation values or percentages.
One of the catches with this change is that consumers may find themselves, depending upon the state of their existing contract, being impacted by either the old or newer policies (i.e. Pounds and Pence vs CPI + 3.9%) because the market is currently in a state of transition. Some providers, like Virgin Media, have got around this by pushing existing customers on to the new policy, while most others, like BT, are allowing customers to make their own decision when re-contracting or upgrading.
BT’s update today merely confirms that they haven’t made any changes to the policy that was first adopted in the spring of last year, so they’re not really saying anything particularly new. But some may find the information they’ve issued useful.
BT’s Pricing Policy Statement
So, from 31 March 2025, for new and re-contracting mobile customers on the Pounds and Pence model, this annual increase will be an extra £1.50 a month. It will be £1.50 a month for connected devices (including laptops, tablets and smart watches), £2 a month for TV customers, and £3 a month for broadband customers.
There will be customers on our CPI+3.9% model, because they were already in contract before we introduced the Pounds and Pence change. There will also be some customers with a mix of the two models across different products.
For CPI+3.9%, we use the December rate calculated by the Office of National Statistics to calculate our price change. This was 2.5%, which means a price change of 6.4% (CPI:2.5% + 3.9%). On average, this year’s change is around £2 to £3 per month – a very small part of an average household’s bill.
A total of 2.6 million customers will be excluded from price change. This includes our Social Tariff customers, landline only customers who don’t have broadband with us or another provider, and those with PAYG on mobile.
For everyone else, this small increase means we can keep giving our customers even more with the latest tech across fibre and mobile as we roll out 5G standalone and Wi-Fi 7 – setting a new standard for connectivity in and out of the home – continue to invest in our network and keep our most financially vulnerable customers connected.
We’re the UK’s best mobile network for 11 years in a row, and one of the country’s fastest broadband providers. The quality of those network is the foundation that means we can bring our customers so much more as demand continues to increase. Average mobile data useage, for example, has more than trebled in the past five years, and mobile download speeds have doubled.
With customers using more data and getting faster speeds, these relatively small price increases mean we can give them the networks they need.
As we’ve previously reported, most of those broadband customers on the older CPI+3.9% model will probably be better off than those who are subject to the new policy (here), which reflects the fact that a static £3 per month increase will often be greater than +6.4%. The other catch is that those on the cheapest entry-level packages will be hit the hardest by the new policy as the £3 increase is the same for everybody, regardless of how much you pay per month.
The policy also only applies to the core subscription prices and not optional add-ons, out of bundle charges or call prices. Suffice to say that, during this transitional period and even after it, there’s still plenty of scope for consumer confusion to creep in. Meanwhile, savvy consumers may be able to use the change to renegotiate a lower price – your milage on this front may vary, but it’s always worth a try (the worst they can say is “no”).
On the flip side, BT and others will always argue that they need to raise prices because their own costs keep going up due to network upgrades, new regulations, new features / content and rising service delivery costs (e.g. energy bills more than doubling over the last two years) etc. Inevitably, those increases end up being passed on to consumers.
However, not all providers adopt the same approach and many smaller ISPs, particularly newer alternative networks (altnets), often promote packages with simple fixed price terms. Choice does exist in the market, at least for most people.