Tips for reducing broadband renewal costs

For a supposedly digital society, we still seem to accumulate a huge volume of paperwork every year.

Bookshelves across the nation are groaning under the weight of policy brochures, T&C documents and renewal letters.

Given the number and variety of contracts most UK households sign up to each year, the endless procession of renewal notices can be daunting.

It’s tempting to stay with an existing service provider for two reasons – to save the hassle of finding alternative quotes, and to avoid the frustration of attempting to switch suppliers.

Sadly, companies recognise this and ruthlessly exploit our loyalty.

Ofcom claim over ten million people in the UK are on contracts whose small print includes automatic price rises after a set period of time has elapsed.

As broad as it’s long

In recent times, there’s been a growing trend for big businesses to whack up renewal costs, adding as much as 50 per cent onto last year’s quote without any explanation.

Hikes in broadband renewal costs are usually hidden away on page two of a reassuring letter that promises “to make life easier” by “automatically renewing your policy”.

The Citizens Advice Bureau recently lodged a super complaint with the Competition and Markets Authority, in response to the price hikes accompanying these automatic renewals.

The CAB estimated 8.7 million consumers were paying a total of £1 billion more than they should, because providers were exploiting their reluctance to leave.

Last month, Which? reported some Virgin Media customers could end up paying almost £600 in unnecessary annual fees if they chose to maintain an existing contract.

Ofcom is already reviewing pricing practices in the broadband sector, but its findings aren’t likely to inspire protective regulation in the immediate future.

Until legislative action is taken, it’s incumbent on consumers to tackle broadband renewal costs.

Contract negotiations

Broadband contracts were traditionally taken out over a 12-month period, though there’s a growing trend towards signing new customers up for 18 or even 24 months.

This isn’t necessarily a bad thing if the deal is competitive, as it reduces the frequency of having to address broadband renewal costs.

Even so, any fixed-term contract will eventually come to an end.

These are our recommendations for finding a suitable deal without breaking the bank:

• Wait until your contract is nearly up. This demonstrates you’re able to walk away from a current provider, and encourages other companies to roll out the red carpet
• Check previous usage. Don’t assume next year’s needs will be identical to previous years. Have you purchased more internet-enabled devices, or waved the kids off to uni?
• Look for bundles. Triple-play packages (broadband, phone and TV) offer economies of scale, but the CAB claim annual loyalty penalties after intro periods average £156
• Estimate future needs. This is particularly true of triple-play or quad-play services. Do you still need unlimited phone calls, or the flagship TV channel package?
• Research the market. Our site lists all the latest broadband deals, with no hidden fees. These provide a clear indication of what your current requirements ought to cost
• Threaten to take custom elsewhere. Some retention/disconnection teams will make counter-offers if customers are able to provide details of cheaper deals being advertised
• Ask about service reductions. If you’re still reluctant to switch despite an existing provider playing hardball, ask to remove elements of the current package to save money
• Be willing to pay setup costs. It’s not necessarily true that these make a package more expensive. That’s why we list deals by first-year cost, rather than initial fees.

If your current provider isn’t willing to offer a competitive rate, it’s time to examine suitable policies listed on BroadbandDeals.co.uk.

Depending on local infrastructure options, switching to a new broadband firm might even result in a faster internet connection without paying significantly more each month.

Alternatively, you may be able to benefit from freebies and incentives – superior wireless routers, internet security packages or mobile WiFi hotspot access.

Bear in mind it isn’t possible to simply cancel a contract and then immediately take another one out as a new customer, even by attempting to use a maiden name or spouse’s identity.

The deals offered to “new” customers only apply once people have been contracted to a different company for the preceding 12 months.