Austerity deal: broadband provider freezes prices as inflation rises | Personal Finance | finance
Cuckoo has announced that it has frozen the price of its broadband contracts at 2020 levels and will continue to do so for next year. This offers households a significant savings opportunity as other broadband providers increase their prices in line with inflation. Remarkably, eight of the UK’s legacy broadband providers have increased their prices by 8.2 to 9.3 per cent despite wholesale costs remaining flat over the past two decades.
Households are currently experiencing an increase in the cost of living, compounded by rising inflation and energy bills.
Inflation in the UK is currently 9.9 percent. Although this is a slight decrease compared to the previous month, the prices for goods and services for daily needs are being increased.
However, this has not stopped broadband providers from raising their prices above the rate of inflation.
Recent research shows broadband providers will be in for a £1.4 billion windfall in this era of rising inflation.
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James Fredrickson, Director of Policy at Hyperoptic, stated: “Mid-contract price hikes to fight inflation just aren’t fair.
“Most people don’t know it’s going to happen or have no idea how much more they’ll have to pay.
“We have called on Ofcom and others to introduce stricter rules that will force operators to be transparent about price increases and customers should have the right to switch providers free of charge if they are affected by an increase.”
Despite this, broadband providers like Cuckoo are freezing their prices for the next 12 months to give consumers an affordable option not offered anywhere else in the market.
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Explaining why the provider decided to support customers in this way, Alex Fitzgerald, CEO of the broadband disruptor, told customers “we stand behind them”.
Mr Fitzgerald explained: “People need to be able to plan their finances and right now prices are going up everywhere you look.
“But we want to be different and show our customers that we stand behind them. We will not squeeze them if they are already being squeezed.
“If you sign up, I guarantee you will not see a price increase for a year and will enjoy the same prices we charged when we launched almost three years ago.
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“We can’t say we will never raise prices, but we will always be honest and transparent.”
To help people get a better deal on broadband, media regulator Ofcom has introduced new rules forcing providers to notify customers when their contract is about to end.
This means consumers now have more control over whether to switch to a broadband plan that offers them a cheaper price, such as B. with Cuckoo.
The regulator found that after the switch, households were able to save more than £110 a year on average.
James Mackley, Ofcom’s Economics Director, highlighted how households can benefit from this change in broadband regulations.
Mr Mackley said: “It’s encouraging to see more people saving money after we’ve made it easier to get a better deal.
“This is particularly important at a time when household budgets are under heavy strain, as the savings potential available can be significant.
“So it’s worth checking if you’re out of contract and seeing what offers are available.”