Skip Navigation


Inflation busting price rises at BT Consumer division
Saturday 23 August 2014 11:10:33 by Andrew Ferguson

While a lot of coverage on the BT Consumer price rises appears to be aimed at the spending on BT Sport, BT Sport is just one small part (though highly visible) of what the BT Consumer arm are doing. If there is any anger over the price rises, it should actually be at the collective lack of competition from the largest phone and broadband providers, where pricing seems to be converging and the trend each year is for BT to increase their price and others to increase to within an ever closer margin.

The price rises for BT Retail/Consumer customers take effect from 1st December 2014, and if you are in a contract and the price rises affect you then you should be able to exercise your right to exit a contract without penalty. The main changes are (they all take effect on 1st December 2014):

  • Voice line rental increasing by £1/month to £16.99 as of 1st December 2014
  • Line Rental Saver will increase from £159.84 per year to £169.90 per year (equivalent of £14.16 per month.
  • Call set-up fees for chargeable calls will increase from 15p to 15.97p
  • Calls to landlines will increase from 9p per minute to 9.58p
  • Early Contract Termination charges (when you leave while in contract and it is not because of price rises) are changing, details on the BT website
  • Broadband prices to go up by up to 6.49%, but we are yet to see full details
  • BT Customers can find out more and information on when they will be notified here

As you can see from our twitter feed, we have looked back over some years and the retail pricing of voice services is diverging from the wholesale pricing. This is probably down to a number of factors, such as increasing use of call bundles by consumers and the rise of line rental saver options, the number of freebies, e.g. WiFi access, BT Sport, Parental Controls, cloud storage, free YouView set-top boxes and all the other costs of running a business that have not gone down in the last few years. While it is very easy to suggest that the extra revenue will (1) pay for more fibre roll-out or (2) repay some of the BT Sports costs, this raises the question why are operators like Virgin Media who are totally independent of Openreach pricing increasing their line rental too and the trends suggest the margin between the big providers is decreasing?

The real answer is that the market is charging what the market can get away with, both by us the consumers not always shopping around and changing voice/broadband providers and a regulator in the form of Ofcom that is balancing the wholesale pricing but seems to be ignoring a retail market where it is almost impossible to get broadband without taking voice line rental from the same major provider now.

For those really struggling financially, if you are on Income Support, Income based Jobseeker's Allowance, Pensions Credit, Employment Support Allowance or Universal Credit take a look at BT Basic which provides voice line rental at £15.30 every quarter (includes £4.50 calls allowance) and an ADSL2+ service with 10GB usage allowance for £4.85 per month (includes access to WiFi when out of the home). The Basic service is provided as part of the USO obligations imposed on the BT Group.

Comments

Posted by adslmax about 1 year ago
Get rid of BT the sooner the better!
Posted by AndrueC about 1 year ago
And replace it with what exactly? Another private sector behemoth that we have no experience of? Government control?

I don't think anyone old enough to remember when the PO was running things would want the latter option. And I'd hope that anyone old enough to vote had grown out of the naive belief in government omniscience.
Posted by AndrueC about 1 year ago
And with the likes of Theresa May making decisions do you really want to give them that much control?

At least we understand BT. Better the devil you know and all that.
Posted by Blackmamba about 1 year ago
Hi Broadband Watchers.
If you do not like your ISP over price and service change.
Posted by herdwick about 1 year ago
A call setup fee of 16p is eye watering. Doesn't seem that long since I moved away from BT Retail because we were incurring a lot of 5p minimum call charges on local calls, these would now be 17 or 18p !
Posted by Dixinormous about 1 year ago
Excellent timing, wanted rid of them and they've saved me the wait for the end of the contract.
Posted by c_j_ about 1 year ago
"A call setup fee of 16p is eye watering."

Indeed, how on earth is that acceptable to the alleged regulators?

Are the likes of 1899 etc still accepting new customers? 5p or so TOTAL for a UK 01/02/03 call up to an hour. Are BT still obliged to allow access to the alternate carriers?

Something seriously wrong in "the market" here.
Posted by herdwick about 1 year ago
WLR3 as above is what a 3rd party retailer would "consume". 5p setup over at http://www.idnet.net/voice_products/homephone.php for non-inclusive calls.
Posted by otester about 1 year ago
The people voted for the current economic situation, they should enjoy it.
Posted by _Resonance_ about 1 year ago
Will they give you a MAC code to move (if still in contract)? Or do you have to cancel?
Posted by NilSatisOptimum about 1 year ago
So good it needs saying again-

"The people voted for the current economic situation, they should enjoy it."
Posted by k00lworld about 1 year ago
Excellent news. I was expecting to have to wait for my contract to end next summer but it looks like I can get out early without penalty.
Posted by andrew (Favicon staff member) about 1 year ago
Should be able to get a mac
Posted by Deezel about 1 year ago
Moved from grabbing useless BT years ago, now using 18185 most calls are free except you pay just 5 pence connection charge
Posted by AndrueC about 1 year ago
Ouch at the setup fee..except that I've gone for their anytime call package for the last couple of years so don't care. You don't have to make many calls to get value out of the extra £7.5 a month. five 15 minute calls will do.
Posted by _Resonance_ about 1 year ago
@Deezel I use 1899. Same company I believe. You can't go wrong with 5p per geographic call, no matter how long
Posted by c_j_ about 1 year ago
"You don't have to make many calls to get value out of the extra £7.5 a month."

May be true if you're comparing with BT Retail's own outrageous prices.

Comparing with a sensibly priced carrier (FinArea eg 1899 etc at ~5p per UK call, or even someone just reselling a BTWholesale product) changes the breakeven point somewhat.

£7.50 a month on a 5p/call service is around an average of 5 calls a day. Some houseolds won't come near that, some will.
Posted by BlackAle about 1 year ago
16p setup fee is ridiculous. I use voip, 0p setup fee, 0.5p per minute.
Posted by jrawle about 1 year ago
Thanks BT, you've done me a favour and saved me the decision of whether to leave you when my Line Rental Saver runs out in January. I already resent paying for BT Sport when I have no interest in sport (or TV really, for that matter). Can someone tell me if I need a MAC to move my FTTC?
Posted by andrew (Favicon staff member) about 1 year ago
Yes you need a MAC from the existing provider.
Posted by Kr1s69 about 1 year ago
I've just got my Mac and signed up with Plusnet, its odd being back there!

For the sake of £1 line rental and £1.75 infinity, BT have lost a customer.

Quidco have £100 cashback too, so it was an obvious choice to leave!
Posted by c_j_ about 1 year ago
"Quidco have £100 cashback too, so it was an obvious choice to leave!"

How many years will it take Plusnet, a self confessed low margin outfit (even before the BT takeover), to make £100 profit from anyone signing up on this deal?

Or is it more about making sure punters don't leave BT Group altogether, regardless of cost?
Posted by stator about 1 year ago
It does seem that something is broken in the telecoms market. The requirement to take a phone line at the same time as broadband is quite ridiculous in the 21st century.
Posted by Blackmamba about 1 year ago
Hi Broadband Watchers.
As the market is comlpletely open you pay for the service you require/ request this is where the saying kicks in. (buyer beware).
Posted by gerarda about 1 year ago
When you have market failure and a regulator indistinguishable from the major provider then this sort of abuse of the consumer is inevitable.
Posted by Kr1s69 about 1 year ago
@C_J_

They'll make nothing on the broadband as I think it's lower than the openreach port costs (I'm paying 14.99 per month)

There's profit in the line rental and the few calls I make but it's rather limited.
Posted by zyborg47 about 1 year ago
I am so glad I do not have to pay line rental.
Posted by c_j_ about 1 year ago
"They'll make nothing on the broadband .. it's lower than the openreach port costs ...

There's profit in the line rental and the few calls I make but it's rather limited."

So it's about using a BT-group loss leader to minimise the prospects for other potential low cost competition then.

Wakey wakey Ofcom.

Nah, not gonna happen.
Posted by Blackmamba about 1 year ago
Hi Broadband watchers.
Plusnet is using a sprat to catch a mackerel and the mackerel is not BT.
Transfer costs just a QOS click.
Posted by fastman about 1 year ago
plusenet is not a BT Group business it buys from openreach at same terms and other Service providers

Posted by comnut about 1 year ago
Hey correct if wrong...

*every* ISP except Virgin fibre (I'm not sure about Sky fibre...) uses BTgroup lines!!
the ISP only takes care of the 'local loop' (from the street cabinet to your home)
Posted by comnut about 1 year ago
fastman:
er, read this...
http://www.thinkbroadband.com/isp/plusnet.html

http://www.ispreview.co.uk/isp_list/ISP_Detail_Fixed_Line_Broadband.php?PlusNet-153

http://www.dslreports.com/comment/2905/60300
Posted by c_j_ about 1 year ago
"plusenet is not a BT Group business"

As of 30 Jan 2007, who are the Directors, and the shareholders, of BT and Plusnet? The same.
http://www.btplc.com/report/report08/financialstatements/Consolidatedfinancialstatements/aquisitions.htm


"it buys from openreach at same terms and other Service providers"

Right.

The fact that it'll be YEARS before current Plusnet deals make money for BT Group, and that such deals would likely be unaffordable for genuine standalone companies, is obviously irrelevant. Right.
Posted by gerarda about 1 year ago
@fastman "plusenet is not a BT Group business" Plusenet might not be but Plusnet definitely is.
Posted by 2doorsbob about 1 year ago
looks like we are having to pay for all these new infinity cabs there fitting
Posted by Blackmamba about 1 year ago
Hi 2doors
Remember when a new Cab FTTC is open all ports are costed the same thus no restrictions on pricing it can either go up or down or be a glorified Cartel.
Posted by chrysalis about 1 year ago
yeah the good news is with these price rises is that the contract lengths are shortened, e.g. one can join about 9-10 months after a price rise and effectively have a 1-2 month contract :)
Posted by Blackmamba about 1 year ago
Hi Chrysalis
Please remember you get what you pay for in time and effort so buyer beware.
You must be logged in to post comments. Click here to login.