Nearly 11million homes who changed broadband providers during the pandemic could face being switched onto a more expensive ‘default’ service when their initial contract period comes to an end, new research reveals.
Some 41 per cent of households switched broadband provider in the last two years with 29 per cent doing so due to working from home in the pandemic, according to data from Compare the Market.
Most broadband deals are available as 12, 18, or 24-month packages. As a result, millions face the potential of being switched onto a more expensive default contract by their current provider.
As the cost of living soars, and people continue to work from home, households should check their broadband package to ensure they won’t be paying more than necessary.
Millions of households could face being switched onto a more expensive ‘default’ service
When asked how much their broadband costs would go up by at the end of their initial contract, the average respondent to Compare the Market’s survey said it would rise by an average of £31 per year.
However, according to Ofcom, the average price rise for out-of-contract households is nearly double that amount.
On average, out-of-contract households pay around £4.70 per month more than the provider’s average price for their broadband package – or an extra £56 per year.
In the event of a price rise of £25 a month, research shows there is a rise in switching intention for a number of consumers.
Some three in five respondents said that when their contract ends they will consider switching provider.
The research shows, however, the broadband market does suffer from switching inertia which could leave many households on more expensive contracts as 59 per cent of households have not switched in more than two years.
Of those, 15 per cent said they have never switched with respondents aged 55 and over the most likely to have never switched their broadband provider.
The main reason people switched provider during lockdown was due to issues with broadband speed with 39 per cent citing this as a reason.
Meanwhile, for most people choosing a broadband deal, the reliability of broadband is more important than paying a low price.
Customers are encouraged to see if they could find a cheaper broadband deal online
Some 66 per cent of respondents described the reliability of broadband as essential, compared to 31 per cent who described a low price as essential.
Mubina Pirmohamed, head of digital at Compare the Market, said: ‘In the last two years we have seen a surge in households changing broadband provider.
‘Working from home tested people’s broadband reliability, with many deciding to switch in a bid to find a better provider.
‘Those who switched are now nearing the end of their initial contract periods and may face significant price-hikes if they choose to stick with their current provider.
‘Shopping around online and switching to a better deal can help people to improve broadband speed and save money.
‘At a time when bills are going up across the board – from energy to supermarket trips – it is important to see if you can get better value for money by switching broadband provider.’
To see if you can find a better deal, use This is Money’s comparison service.
Compare the Market surveyed 2,000 households to get the results.
Many are still relying on their broadband as they work from home during the pandemic
Best broadband deals on the market
This is Money, with the help of Broadband Choices, has put together a list of the best broadband deals currently on the market.
Virgin Media has a range of fibre broadband deals customers can choose from.
The firms M100 Fibre Broadband deal is £24 for 18 months with a £50 Amazon voucher with speeds of 108Mbps.
For those wanting faster internet, the M200, M350 and M500 offer speeds of 213Mbps, 362Mbps and 516Mbps, respectively.
Prices range from £28 to £36 with all contracts lasting for 18 months with a £50 voucher. All the offers end on 13 January 2022.
Meanwhile, Vodafone is offering its Superfast 1 deal for £19.50 a month on a 24 month contract.
Customers will get average download speeds of 35Mbps and those joining will also get a £100 Amazon voucher.
Those looking for a faster connection can join Vodafone’s Superfast 2 deal, which is £20.50 a month and offers speeds of 55Mbps also with a £100 voucher.
The cheapest deal is with Plusnet on its Unlimited Broadband for £18.99 a month for 12 months. Customers will also get a £70 Plusnet Reward Card.
It is also offering Unlimited Fibre broadband for 18 months for £22 a month with customers able to get a £70 Reward Card which is preloaded with cash.
Its Unlimited Fibre Extra offering is £24 a month and also comes with a £70 Reward Card. All offers end on 2 February 2022.
BT has a range of deals including its Fibre 2 Only broadband deal costing £29.99 for 24 months. Customers signing up can take advantage of a £90 BT Reward card.
Its Entertainment + Fibre 2 Only deal is £37.99 for the first 3 months before increasing to £45.99 on a 24 month deal. It also comes with the £90 BT Reward card.
Finally, the Sport + Fibre 2 Only package is £44.99 for 24 months with a £90 BT Reward card. All deals end on 13 January so hurry.
Sky is offering its Superfast Broadband on an 18 month contract for £25 a month with average download speeds of 59Mbps.
|End Date||Provider||Product||Contract Length||Monthly Fee||Setup Fee||Exclusive|
|13-Jan-22||Virgin Media||M100 Fibre Broadband only||18 months||£24.00||£0.00||£50 Voucher|
|13-Jan-22||Virgin Media||M200 Fibre Broadband only||18 months||£28.00||£0.00||£50 Voucher|
|13-Jan-22||Virgin Media||M350 Fibre Broadband only||18 months||£32.00||£0.00||£50 Voucher|
|13-Jan-22||Virgin Media||M500 Fibre Broadband only||18 months||£36.00||£0.00||£50 Voucher|
|27-Jan-22||Vodafone||Superfast 1||24 months||£19.50||£0.00||£100 Amazon voucher|
|27-Jan-22||Vodafone||Superfast 2||24 months||£20.50||£0.00||£100 Amazon voucher|
|13-Jan-22||BT||Fibre 2 Only||24 months||£29.99||£0.00||£90 BT Reward card|
|13-Jan-22||BT||Entertainment + Fibre 2 Only||24 months||£45.99||£0.00||£90 BT Reward card and £37.99 for the first 3 months|
|13-Jan-22||BT||Sport + Fibre 2 Only||24 months||£44.99||£0.00||£90 BT Reward card|
|02-Feb-22||Plusnet||Unlimited Broadband||12 months||£18.99||£0.00||£70 Plusnet Reward Card|
|02-Feb-22||Plusnet||Unlimited Fibre||18 months||£22.00||£0.00||£70 Plusnet Reward Card|
|02-Feb-22||Plusnet||Unlimited Fibre Extra||18 months||£24.00||£0.00||£70 Plusnet Reward Card|
|27-Jan-22||Sky||Superfast Broadband||18 months||£25.00||£0.00||N/A|
|Source: Broadband Choices|