Virgin Media has announced a change to the way it calculates the increase on broadband bills for its customers. Starting next year, the telecoms company will use the Retail Price Index (RPI) rate of inflation, plus an additional 3.9%, to determine the rise in costs. Previously, the increase varied based on package types and market conditions.
The RPI figure for February will be used to calculate the price rise, which will come into effect from April. The current RPI stands at 9%, but it may fluctuate before February. Customers who are unhappy with the announced changes can cancel their package without any cancellation fees, as long as the cancellation is made before October 31, 2023.
Virgin Media aims to provide more clarity by linking the price rise to the RPI rate of inflation and an additional 3.9%. This means that customers will have a clearer understanding of any increase in their bills. The change is part of a broader industry practice, as other broadband providers like BT, TalkTalk, and Vodafone also use the RPI method to set pricing.
In the past, some customers experienced steep price increases of up to 17.3%, despite calls from regulator Ofcom for telecoms providers to consider financial hardships and refrain from large price rises. Virgin Media has communicated these changes directly to its customers and believes that the introduction of inflation-linked price changes will provide clarity for customers while supporting necessary investments.
To reduce broadband costs, customers can explore options such as switching to a different provider or negotiating a better deal with their current provider, especially if they are nearing the end of their contract. Comparing prices using websites like MoneySupermarket and Uswitch can help identify cheaper deals. Additionally, customers should assess whether they truly need the speed they are currently subscribed to and consider downgrading to a slower speed to save money.
Sources:
– Original article: not specified
– Definitions: Retail Price Index (RPI): a measure of inflation in the United Kingdom that tracks the changes in the cost of a representative basket of retail goods and services.
– regulator Ofcom: the independent regulator and competition authority for the UK communications industries.