Ofcom to ISPS: promote cheaper deals or we’ll take action

Ofcom has said more must be done to help poorer households afford internet access and phone subscriptions, but has stopped short of forcing broadband companies to offer cheap deals for low-income families.

Last month, the regulator published research showing that nearly two million UK households struggle to pay their internet bills. Between January 2020 and January 2021, total debt among broadband and mobile customers increased from £475m to £550m.

Ofcom did acknowledge that some firms have introduced “social tariffs” which, it estimates, can save low-income households more than £200 a year.

BT, for example, recently launched its £15-a-month Home Essentials package ( www.snipca.com/39031, see screenshot) for people who receive certain benefits, including Universal Credit. Virgin’s Essential service ( www.snipca.com/39032) costs the same, though it’s available only to those on Universal Credit.

However, Ofcom says companies need to improve how they promote these deals because only 40,000 households have signed up to one – just one per cent of those who are entitled to.

It warned that if firms don’t take sufficient action, it thinks there would be a “strong case” for exploring whether tariffs should be compulsory.

Overall though, it finds customers “are getting better services while prices have been falling”. In 2020, the average price for new customers on broadband and landline bundles was nearly 20 per cent cheaper in real terms than in 2015, while speeds rose by 178 per cent. The cost of mobile data has fallen by a similar amount.

Ofcom has asked for feedback from interested parties before deciding what to do.