Are broadband firms profiteering?

[briansnail]

Most Broadband firms are putting up their prices.Is this fair?

They now have more users working from home,more schoolchildren and more TV streaming. This suggests more customers and higher prices.and nice juicy profits.
They have not increased salaries to any of their staff that have been publicly announced.
I can understand why e.g fertilizer prices (oil) and manufacturing costs have gone up (energy).Broadband firms have more "fixed" costs.
When other companies are valiantly struggling to contain costs for UK consumers.These broadband companies are sneaking them in.Their inflation costs are much less than than inflation costs from other sectors.How come all announce at the same time?
However there is probably a good reason which is........?
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I ride Brompton and a 100% British Vintage cycle

[simonineaston]

screenshot of hyperoptic's website

[Paulatic]

Mine has doubled in price
Simply because I’d had 3 months at half price Price now back to where it was.

ASDA price.

[Tangled Metal]

Do you think that broadband companies won't have increasing overheads and why? Fuel price increases electricity prices which increases cost to maintain any IT systems including broadband. To me it is understandable. They don't just fit the connections then no more costs just money rolling in.

The network has running costs even without maintenance. Those packets of light based signals are created with electricity so there's one source of cost increase. Then you've got maintenance, back office, sales, marketing, etc. Some are provided direct by the provider others via open reach as a supplier.

Of course that's all obvious but we do need to understand by how much costs go up vs sales prices to understand whether profiteering applies. I suspect that competition is keeping the profiteering at bay. There's talk of domestic energy increases reaching 54%. Who's to say that's not similar to what the broadband providers are experiencing%

[Bonefishblues]

Half of my 9.something % increase is for build-out of the fibre network, I think.

ETA
I'd trade HS2 for that, plus Northern Rail infrastructure upgrades, and have change, lots. Then we'd be starting to Level Up.

[PedallingSquares]

Prices increase,the world turns,fashion changes,the weather changes.It is part of life.No point moaning.If it bothers you don't pay,it's that simple!

[Bonefishblues]

It's not really quite that simple though. Broadband provision is both ubiquitous and essential for almost everyone.

[Psamathe]

Compared to other common subscription services I think Broadband is not a bad price. Of course you can pay some amazing rates but if you take a bit of care you can get a reasonable price and not suffer ludicrous price increases. Later this year I'm due to have a price reduction.

Where I do think the broadband companies are failing is in charging people (normally rural locations) standard rates for diabolical poor links. It's something that will take time to address but making those on slower than dial-up pay the same as somebody with good FTTC is poor practice.

Ian

[PedallingSquares]

It's not really quite that simple though. Broadband provision is both ubiquitous and essential for almost everyone.

Exactly so if you need it,then like gas/electricity/petrol/diesel you have to pay for it.You have two choices.
Pay.
Don't pay.
I don't think it gets any simpler!
Being ripped-off is not a new phenomenon.

[Bonefishblues]

It's not really quite that simple though. Broadband provision is both ubiquitous and essential for almost everyone.

Exactly so if you need it,then like gas/electricity/petrol/diesel you have to pay for it.You have two choices.
Pay.
Don't pay.
I don't think it gets any simpler!
Being ripped-off is not a new phenomenon.

Admirable sangfroid whilst being ripped off, I must say.

Are you sure that we should simply take it without moaning/debating/discussing, which is what the OP is doing?

[Psamathe]

I wonder how many people are being "ripped-off" because they don't take the trouble/time to sort out not getting ripped-off. I know I'm paying a lot less than others nearby for the same broadband connection because near the end of each contract term I call my provider and "negotiate". And over the years "negotiating" as got easier and faster as these days it is more just getting them to maintain the existing discounts (then a few minutes to further increase the discounts ...).

It's been discussed in another thread recently viewtopic.php?p=1682117&hilit=hurdle#p1682117 apparently called "hurdle discounting". Does setting a price and allowing the customer to negotiate represent "being ripped-off"?

Ian

[PH]

It's not really quite that simple though. Broadband provision is both ubiquitous and essential for almost everyone.

Indeed, yet when the Labour Party proposed doing something for the benefit of all in the last GE manifesto, it was heavily criticised.
The internet has become such a part of everyday life, it should IMO be considered a public service and if not publicly owned then at least better regulated.
I come out of this one a winner, I live somewhere with a good connection, the BB providers are falling over themselves for my easy money, my price increase is below inflation. Plenty of losers as well, all those who are not as profitable for the suppliers or don't have the choice. I don't get why anyone would consider it profiteering, it's what commercial companies do, they exist for the benefit of the shareholders, why would anyone expect different?

[Tangled Metal]

I wonder if people think they ripping them off because they don't see or understand what the true offering is, involves and costs?

[axel_knutt]

I wonder how many people are being "ripped-off" because they don't take the trouble/time to sort out not getting ripped-off. I know I'm paying a lot less than others nearby for the same broadband connection because near the end of each contract term I call my provider and "negotiate". And over the years "negotiating" as got easier and faster as these days it is more just getting them to maintain the existing discounts (then a few minutes to further increase the discounts ...).

It's been discussed in another thread recently viewtopic.php?p=1682117&hilit=hurdle#p1682117 apparently called "hurdle discounting". Does setting a price and allowing the customer to negotiate represent "being ripped-off"?

Ian

I check for the cheapest tariff with gas & electricity, but I CBA with broadband/phone. The reason is price confusion.

When the internet first appeared, everyone said "won't it be wonderful, you won't have to spend hours shopping around any more, you'll just be able to find the cheapest price in seconds online", and so it was for a while: internet search engines had effectively undermined hurdle discounting as a marketing technique. The solution to the problem was price confusion: make it as difficult as possible to compare prices on a like for like basis by making the products "different". That's not so easy with fuel, where a kWh is a kWh, but with phones they can have a field day: different tariffs for data/speech, internet/phone, time of day etc etc, the opportunities are endless (think how much harder it's going to be to compare electricity tariffs when pricing by time of day is introduced). Another example is car hire and cheap flights, where previously inclusive costs are now hidden extras excluded from the advertised price. John Lewis promised to refund the difference if you found a product cheaper elsewhere, but how many people noticed that they gave a "free" two year guarantee with everything so that they can argue you're not comparing like with like?

"We'll refund the difference if you can find it cheaper elsewhere" is an example of hurdle discounting in itself. If you advertise a TV for £700 when a competitor's selling it for £600, you can do one of two things:
1. Reduce the price and lose £100 on every one you sell.
2. Promise to refund the difference, and only lose the money when people can be bothered checking your competitors.

Promises to refund twice the difference tell you something about how many people actually bother checking, people see the offer and just assume it must be the cheapest price.

I wonder if people think they ripping them off because they don't see or understand what the true offering is, involves and costs?

Price confusion.

[PedallingSquares]

It's not really quite that simple though. Broadband provision is both ubiquitous and essential for almost everyone.

Exactly so if you need it,then like gas/electricity/petrol/diesel you have to pay for it.You have two choices.
Pay.
Don't pay.
I don't think it gets any simpler!
Being ripped-off is not a new phenomenon.

Admirable sangfroid whilst being ripped off, I must say.
Are you sure that we should simply take it without moaning/debating/discussing, which is what the OP is doing?

What else can we do?
If prices didn't rise we'd still be paying 2p a pint and 10p a gallon for petrol
BTW I don't think I'm being ripped-off but the OP obviously does.I pay the lowest price I can but that price is a finite number and once reached you pay or you don't get.