I did provide an example of the average prices but deleted it as my post felt too complicated.

Depending on when in the cycle you sign up you may be paying a higher price for longer (sign up just after the price increase and you pay that price for 12 months, sign up just before a price increase and you may only pay it for 1 month (or less). The big question is whether the price for new sign ups goes up the same or whether they keep them lower than the people on contracts are paying (sign up deals could mean that a new sign up pays less than someone who is part way through a contract and already had a price rise).

My main point is that if on average over the contract it is going to be £31.50 rather than £30 to start then £33 then why not just charge the known average in the first place - it is to grab headlines and to mislead people who aren't as mathematically astute or wary.

In reply to a post by ian72:

The big question is whether the price for new sign ups goes up the same or whether they keep them lower than the people on contracts are paying (sign up deals could mean that a new sign up pays less than someone who is part way through a contract and already had a price rise).

Yes, I edited my post. The supposition depends on the initial pre-rise price staying the same.

In reply to a post by ian72:

My main point is that if on average over the contract it is going to be £31.50 rather than £30 to start then £33 then why not just charge the known average in the first place - it is to grab headlines and to mislead people who aren't as mathematically astute or wary.

I don't disagree in principle. Of course there's no mandatory price increase imposed by Ofcom, and if a supplier wishes to offer a contract which is of a fixed price (maybe they do?) then they are free to do so.

In reply to a post by Oliver341:

Of course there's no mandatory price increase imposed by Ofcom, and if a supplier wishes to offer a contract which is of a fixed price (maybe they do?) then they are free to do so.

The problem is that they're allowed to use the starting price as the headline price, and so the ISPs which don't do this are at a disadvantage.

Example:

ISP1: charges £28 per month to start, then £31, then £34
ISP2: charges £30 per month, fixed over 24 months

At signup time, ISP1 shouts "Internet £28 per month! (*)" and the customer thinks they are cheaper than ISP2 - when in fact they are more expensive overall.

(*) With tiny print says there price goes up every April - often not even saying how much. e.g. look at Plusnet's signup page: it says "Full Fibre 300, £29.99 per month, increases 31 March", but doesn't say by how much - even if you click on "Package and speed details".

Even if that were made clearer, most people couldn't be bothered to work out whether it's cheaper overall, because it means counting how many months until April, and how many months are at the end of the contract, and multiplying it all up.

In reply to a post by candlerb:

Even if that were made clearer, most people couldn't be bothered to work out whether it's cheaper overall, because it means counting how many months until April, and how many months are at the end of the contract, and multiplying it all up.

Price control efforts are wasted on people who think like that.

In reply to a post by candlerb:

Even if that were made clearer, most people couldn't be bothered to work out whether it's cheaper overall

I think the expectation will be for the people wanting a price fixed across the entire contract to pay more. It seems like something some of the more niche providers would offer, which have a higher headline price in the first place and more wiggle room to accommodate inflation/rpi increases.

In reply to a post by Oliver341:

more wiggle room to accommodate inflation/rpi increases.

However, that's not the reason why providers are having the in-contract rises. If it were, then when the price goes up from £x to £y for in-contract subscribers, it would go up for new customers too, if it truly reflected an increased cost base over time.

What actually happens is that the prices go up for in-contract subscribers, but new subscribers are still given the lower price.

The *only* reason for giving the lower up-front price is to make the headline figure look better, i.e. to mislead the customer about the true cost they are signing themselves up to.

In reply to a post by candlerb:

If it were, then when the price goes up from £x to £y for in-contract subscribers, it would go up for new customers too, if it truly reflected an increased cost base over time.

Yes, and consumers do have to be savvy, most are realising that re-contracting in the broadband/mobile sector is a fact of life now. The same is true in other sectors, such as where a savings account starts off with a good interest rate and dwindles over time relative to newer products, or where renewal rates for insurance escalates in the second and third years for no particular reason.

Simple soul's simple calculation: we pay Plusnet £29.61 per month, say £30. That's £360 per year. Pnet says it will increase prices on our two-yr contract by £3 pm, that's £36 per year. Or 10% per annum.

How many people other than public sector can expect annual pay or pension rises of 10%? Probably better than OPfcom's original gift of 3.9% + inflation.

In reply to a post by Malwaremike:

How many people other than public sector can expect annual pay or pension rises of 10%? Probably better than OPfcom's original gift of 3.9% + inflation.

Stick to facts.
Overall, between December 2019 and November 2023, inflation-adjusted average private sector pay grew by 2.3%, whereas public sector pay fell by 0.3%
https://www.incomesdataresearch.co.uk/resources/insi...

In reply to a post by Malwaremike:

Simple soul's simple calculation: we pay Plusnet £29.61 per month, say £30. That's £360 per year. Pnet says it will increase prices on our two-yr contract by £3 pm, that's £36 per year. Or 10% per annum.

By my back of a fag packet calculation if you take out a contract in January you will pay £27 extra over the first year of the contract (£3 extra from 4th month) and an additional £63 during the second year (rising to £6 extra from 16th month) as prices go up on 31st March every year, so a total of £90 extra from what you would have paid if the prices hadn't changed from the original price. Can someone correct me as I'm really hoping I am wrong.

Edited by PCJM40 (Wed 18-Sep-24 22:45:17)