As plans to introduce steep inflation next year have been announced, money-saving experts have warned anyone with a mobile phone deal to be wary.
Some companies are planning to increase costs after changing the terms.
These changes will affect customers who sign up for a new contract or upgrade to a new contract, landing them at a hefty price the following year, the report said.
Mobile companies often increase spending every year but according to the MSE it is usually only consistent with published inflation figures where now, spending is much higher.
What’s going on?
For pay-monthly subscribers who accept or renew new contracts from October 29, 2020, the three will increase by 4.5% next April.
It affects all pay-monthly subscribers, including mobile contracts, SIM-only deals, mobile broadband and home broadband.
This rent will be applicable annually, meaning the bills will also increase by 4.5% in April 2022 – and the year after that.
If you sign a new contract or renew with the three before October 2920, this price increase will not apply to you. Instead, next April your bill will only increase by inflation, as it did in May.
Similarly, Vodafone will raise prices by inflation next April and for pay-monthly customers who sign or renew new contracts from December 92020.
Like the Three, it affects all pay-monthly subscribers, including mobile pay, SIM-wall and home broadband deals, tablets, Apple and Samsung watches, the number one watch and Vodafone Basics plans.
Again, inflation will be applicable annually, so bills will be further increased by inflation in April 2022 and thereafter annual inflation
If you sign a new contract or renew with Vodafone before December 2020, this price increase will not apply to you. Instead, next April your bill will simply increase by inflation, as it did this year.
According to the MSE formula, many companies regularly raise prices mid-contract. After signing up, customers will be allowed to do so until they are warned, but so far this year the mid-contract price increase has been only at the rate of inflation.
Now the significant change is that some companies are starting to lock in high-inflation price increases, which means your bills will become more steep.
As well as Vodafone and Three, MTE reported that BT, EE and Plasnet are already doing it this year.
MSE says the news doesn’t mean you’ll refuse to renew or sign a new deal with Tin or Vodafone, but it’s important to factor in your decision.
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