How to tell if you’re overpaying for broadband

using a smartphone and laptop

Thursday, 28 November, 2019

Like insurance policies, broadband contracts are often negotiated in haste and ignored at leisure.

As long as a policy is in place, it’s tempting to ignore the small print (or emailed statements) and focus on the myriad challenges of daily life.

However, not paying attention to your broadband contract could be a costly mistake.

Which? recently concluded that three quarters of the population is at risk of overpaying for broadband.

In a survey of 2,000 members, only 19 per cent of respondents said they always made changes to their broadband policy when it ended.

A startling 41 per cent claimed to never (or rarely) make changes to a contract they might have negotiated many years ago. Any introductory deals would have ended a long time ago.

And nor is the Which? survey an anomaly. A recent review of broadband pricing by industry regulator Ofcom concluded around 8.8 million broadband customers are out of contract.

These people could all potentially make significant savings by entering into a new contract.

In the meantime, they’re highly likely to be paying more than they need to – or be stuck on a completely inappropriate package for their needs or circumstances.

So what should you do to ensure you don’t end up paying over the odds?

Ways to avoid overpaying for broadband

1. Check when your current contract started – and whether it included an introductory deal.

Contracts are generally 12, 18 or 24 months. Customers are then moved onto a standard tariff, in the same way fixed-rate mortgages default to a Standard Variable Rate after a set period.

Standard tariffs are generally 25 per cent more than the introductory deals people originally signed up to. In some extreme cases, they can be almost twice as expensive.

If you signed up to a 12-month deal last Christmas, for example, this is the time to be researching new tariffs.

2. Find out how much you’re paying.

Even in the age of app-based banking, millions of people pay little attention to bank statements or incomings and outgoings.

Many consumers aren’t aware how much their broadband contract costs each month, so a quick look at recent bank statements is highly advisable.

It can be easy to save money on monthly broadband services, if you know what you’re currently paying – and what you actually need…

3. Check what’s included.

Some of the big broadband companies like Sky, Virgin and BT offer quad-play deals, which combine broadband and landline services with mobile phone contracts and TV.

These often deliver economies of scale compared to four separate contracts, but some of those additional services might be superfluous.

If you hardly use your smartphone, or never watch TV beyond the Freeview channels, it may be worth focusing purely on landline and broadband deals in future.

4. Investigate what other companies could offer.

We have numerous broadband deals on this site, from rolling 30-day contracts to 24-month deals.

How do these compare to your existing contract? It’s easy to calculate possible savings if the basic elements are comparable (unlimited data, similar download speeds, etc).

Your existing provider is legally obliged to help you switch to another provider, so don’t be embarrassed about asking to leave.

5. Ask your current provider to reduce costs.

If changing supplier feels like a big step, most broadband companies have a retentions team, tasked with persuading existing customers not to leave.

They might offer you a cheaper deal to stay, removing the hassle and inconvenience of switching providers.

Being offered a better deal proves you’ve been overpaying for broadband until now, but at least you’ll start saving soon – these deals can often begin almost immediately.

Shouldn’t there be regulations about what happens when contracts expire?

There should be. And from next February, there will be.

Ofcom is introducing a new policy which means existing broadband providers have to notify customers when their contracts are coming to an end.

This should ensure nobody overpays for broadband simply because they didn’t realise an introductory deal had ended.

From next March BT, Sky and TalkTalk have also committed to capping out-of-contract price rises, and ensuring existing customers can enjoy the same deals as newcomers.

Even so, it remains important to shop around for competitive – and suitable – broadband deals.

Neil Cumins author picture

By:

Neil is our resident tech expert. He's written guides on loads of broadband head-scratchers and is determined to solve all your technology problems!

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