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5% increase in charges...justified?

christmas
Aspiring Pro
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Registered: ‎16-01-2011

5% increase in charges...justified?

Has there been an explanation as to why Plusnet charges need to increase by 5% this June and and another 6% increase just 9 months later?

I thought technology was meant to make things cheaper or maintain a reasonable price.

Broadband per month

Nov 2019 £14.49 

Jan 2020 £16.39 

Dec 2020 £16:74

It's now over £200 a year just for broadband, whereas a TV Licence is £40 less for the various TV & Radio channels and iPlayer.

 

17 REPLIES 17
Baldrick1
Seasoned Hero
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Registered: ‎30-06-2016

Re: 5% increase in charges...justified?

@christmas 

 Probably to persuade you to move your phone to Plusnet. This is a very expensive way of getting broadband.  It would be far cheaper to either move your phone to Plusnet or your ISP to whoever you pay your line rental.

Azagoth
Grafter
Posts: 626
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Registered: ‎01-08-2007

Re: 5% increase in charges...justified?

Think of us stuck on copper with no access to fibre, despite living in the middle of a major city.  We're going to be paying silly money for a service that isn't fit for purpose in these days of working from home and multiple video streams.

christmas
Aspiring Pro
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Re: 5% increase in charges...justified?

My query is regarding the size of the increase....The email states the rise is across the board...

 

"From June 2021, the price for broadband, line rental, call plans and call charges will increase each year by the Consumer Price Index (CPI) rate of inflation plus 3.9%"

 

With just 1% pay rises for nurses and zero pay rise for many NHS workers, I'm trying to work out why a 5% increase in charges in June and another 6% increase due next March, is it a consequence of not being in the EU?

pjmarsh
Superuser
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Registered: ‎06-04-2007

Re: 5% increase in charges...justified?

There could be a number of reason such as:

  • To pay for the increase in usage they'll have seen.  Whilst most accounts have unlimited usage, that isn't actually how it works in the real world.  The peak amount of traffic needs to be less than the capacity of the network in a number of different areas otherwise the traffic on those will be delayed (or lost).  That capacity all costs money.
  • Many businesses have had to make changes over this last year, some of which may cost money.  Maybe Plusnet have some of these costs that they need to try and recover
  • May be they are wanting to make some investments in equipment, systems and/or people which they need to cover costs for.

There are probably other possible reasons as well.

The amount anyone pays will ultimately be paying for:

  • fixed wholesale costs of your connection (there are charges from their suppliers for your line and such like)
  • contribution towards the cost of the Plusnet network (getting your traffic from the point it is handed over from the suppliers network to the suppliers of the peering links (which Plusnet need to pay for).
  • contribution towards staff, offices and such like to run the business, the network and support customers
  • contribution towards the ever changing requirements put on them by the regulators
  • contribution towards profit.  Plusnet is a business, not a charity so they need to make some profit

Plusnet (along with any other similar company) need to balance these with the price they charge the customer.  As with pretty much any company they ultimately want to maximise the profit, but that is a fine balancing act between charging as much as possible but retaining customers (lots of customers paying a small contribution to the profit can make a lot more money than a small number paying a large contribution to the profit).

The increase you've stated is the amount that has been determined by Plusnet to meet these objectives.  

billnotben
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Registered: ‎23-09-2010

Re: 5% increase in charges...justified?

The days of price reductions that came with advances is broadband technology have long since passed. Broadband for the majority is now a necessity which changes everything.

So the reason for plusnets rise is simply because they can. And it will allow them to make even more silly offers for new customers and widen the gap paid by new and old customers.

After the rise watch out for the "great" new customer offers.

 

christmas
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Registered: ‎16-01-2011

Re: 5% increase in charges...justified?

Rather than people speculating, would it not make sense for Plusnet to explain the reason?

From the email it looks as if they accept people will leave.

I think I'm correct in saying it will be a 11% price increase within 9 months, when inflation is less than 2%.

 

billnotben
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Re: 5% increase in charges...justified?

Of course the real reason is BT are similarly putting up their prices. Plusnet as a BT puppet must follow suit when the strings are pulled.

So the question is really about BT putting up their prices.

Baldrick1
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Re: 5% increase in charges...justified?


@christmas wrote:

Rather than people speculating, would it not make sense for Plusnet to explain the reason?


Would you believe that this would be the whole truth with no spin?

The simple answer is that they are a hard nosed business that will screw as much out of punters as is commercially viable. This can be dressed up in many ways by the BT customer relations experts/manipulators of statistics retained for this task.

shutter
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Registered: ‎06-11-2007

Re: 5% increase in charges...justified?


@billnotben wrote:

 

So the question is really about BT putting up their prices.


 

Two reasons...... 

 

the first, and most obvious....  "Because they can....... "   being the major infrastructure provider. they can control the price market.

 

the second... ... because they have an agenda  ( my thoughts.... plus a few others on here ) .

 

                                                             . to make PlusNet an "unfavourable" supplier, due to the drop in customer service levels, to almost non-existent.. and the way that PlusNet has dealt with disabled customers, in detriment to their advertised standard .

 

Note... that standard was....  "award winning customer service".. ( which it was.. ) but gradually the levels dropped and it  .. begs the question what was the award for .... best ... or    worst..

 

time marched on and the standards dropped to      "we`ll do you proud "..... 

 

 

 

but again. the service levels dropped, and now they have sunk down to

 

 "That`ll do".....

 



 

 

BurntToast
Newbie
Posts: 4
Registered: ‎18-02-2015

Re: 5% increase in charges...justified?

Well they've lost me. I've just signed up with someone else. I don't mind paying for a service but that sort of rise every year is too much.

jgb
Aspiring Champion
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Registered: ‎01-08-2007

Re: 5% increase in charges...justified?

It is not just the BT companies that are imposing this 3.9% plus CPI annual increase but other sas well. I think I saw a Vodaphone advert with exactly the same rise. Is this collusion?

billnotben
Community Veteran
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Registered: ‎23-09-2010

Re: 5% increase in charges...justified?

I expect many companies simply thinking, well if it's acceptable for the council tax and they can get away with it..........

RobPN
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Re: 5% increase in charges...justified?


@christmas wrote:

 

...is it a consequence of not being in the EU?


@christmas 

Undoubtedly.  Roll_eyes

What other possible explanation could there be?  Roll_eyes  Crazy3

gleneagles
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Registered: ‎02-08-2007

Re: 5% increase in charges...justified?

No one forces anyone to stay with a particular ISP, if you are not happy with price increases then a bit of research will find you a ISP that does not raise the price of your broadband during your contract or at the end of it and provides good supporting services as well.

We are born into history and history is born into us.