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Watch out for 'cheap' broadband deals

You can end up paying expensive penalty fees for some broadband packages.
By Ben Lobel on Sep 11th, 2016   @freelotteriesuk

Comparison website Broadband Genie has issued a warning about cheap broadband deals with data caps, advising that the majority of UK customers could end up facing expensive penalty fees using these packages.

With data use growing exponentially, most broadband customers now opt for an ‘unlimited’ service. However a survey of 2,752 broadband customers by Broadband Genie suggests nearly two million subscribers are on a capped package.

Many ISPs provide cheaper limited deals for customers on a budget. For example, TenTel offers a package with a data cap of 5GB, while BT has cheap fibre products with a 25GB allowance. But penalties can apply if users exceed these limits, which may include service restrictions, an automatic bump to a more expensive package or extra fees costing between £1.50 and 1.80 per GB. And in some cases the penalty for exceeding a limit is not immediately clear, with the details vaguely worded or buried in small print.

Unlike a mobile contract where typically only one user is consuming data, a home broadband connection often serves multiple users and devices. Research by the telecoms regulator Ofcom suggests the average household used 82GB of data a month in 2015, up from 58GB in 2014. If an average household took BT’s standard broadband package with a 12GB data cap, they could face fees of over £100 per month. 

Rob Hilborn, head of strateft at Broadband Genie, says, 'While these packages may suit the needs of select customers, for your average user they’re not fit for purpose and likely to end up more expensive and restrictive than an unlimited package.'

'Many activities online are now very data heavy - even simple tasks will quickly use your data, especially if you’re watching video content. And with most households having multiple devices connecting to a network data limits can be exceeded in no time at all.'

It was also found that capped deals are being bundled with TV packages offering streaming and catch-up, which may count towards the data limit. A single HD film can consume gigabytes of data, so broadband consumers seeking to control costs with a cheaper limited package may quickly eat through their allowance and be hit with additional fees, speed limits or find themselves moved to a pricier service.

Hilborn says that it's concerning that key information is being buried in the small print, as we all know most don’t read terms and conditions. 'We would like to see this vital information more clearly displayed so customers are aware of the risks and can make an informed decision, not one simply based on the supposedly cheaper offering.'

'If you’re at all worried that your chosen package may not have enough data, we would always recommend opting for an unlimited service for peace of mind. Going over your limit by a few GB will wipe out any financial benefit of the cheaper capped package.'

 


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