How can broadband providers justify annual price increases ?

iniltous

Openreach do indeed offer various service level agreements to its ISP customers, BT take (and pay for) the premium SLA so can offer its customers repairs etc. to be completed two working days after the fault is accepted as an issue they are responsible for , and BT are a member of the Ofcom automatic compensation scheme, so should the repair or installation date be missed, the compensation clock starts , something many ISP’s are not a part of (it isn’t compulsory) , so if BT have a better SLA than some , because those companies chose to take the cheaper Openreach SLA , and BT pay compensation when others don’t , that’s a couple of reasons why they may not be the cheapest.

Kim_13

They can't, certainly not increases of the magnitude that they are making, but they don't have to. If anyone points out that the new increases are far in excess of the old ones, they will say it was Ofcom's decision, provides price certainty and is in line with the market. Completely ignoring the fact that the size of the annual increase and the application of it (a flat rate irrespective of the original price) was entirely of their own choosing.

It is worse in the case of broadband in that there isn't exactly a viable alternative, whereas if you don't agree with the principle of a pounds and pence rise on your mobile contract, you can go and get a pay as you bundle with no discernible difference in the quality of service received. That they still increase the size of the increase on 30 days notice with a penalty free exit window means that the providers are having their cake and eating it; there can be no greater evidence that a contract is only binding on the consumer, the weaker party. If the provider want out, they can just put the annual increase to something obscene so that the consumer exercises the right to cancel and removes their obligations. The consumer cannot say I am giving you 30 days notice that I am only paying £X for my services, which would be the equivalent. A customer that finds their circumstances changing for the worse during the contract are reliant on any goodwill the provider might give them - and with contract terms extending all the time, that's an eventuality that becomes more likely.

It would be interesting to see some research on whether contracts are now cheaper over the period compared to when the price was the price until the contract ended. An argument in favour of annual price rises is that they are.