Inflation based price increases

[Paul_72]

The recent notification of price increases have really highlighted the unfairness of the contracts that everyone signs and few read properly.  The contracts include an annual price increase of CPI plus 3.9% and the advising letter explains it is needed to cover increases in the costs of running a business and to continually improve the network provided.  This is acceptable for services (even if the extra 3.9% over CPI is excessive) but it doesn't explain why people who have monthly contracts that include a handset should pay the increase on the handset element too.  When the contract is initially priced the calculation would have two elements, The price of the handset, which will not change spread over the contract period plus the cost of the services used.  Given that the handset will be fully paid for by the end of the contract why does the amount you pay incur an increase at all.  If you bought any other product over a period of time you would agree  a fixed monthly payment over the agreed contract period which would not change and nobody would expect a demand for extra money during a period of high inflation, why is not the case for the handset element of a phone contract and why is it allowed?

[bristolian]

You make a compelling argument for splitting the phone purchase from monthly airtime provision.

This can already be achieved by buying your phone SIM-free, and having a SIM-only plan.

[Paul_72]

I agree on the solution and I'm sure that many people including me, will look more closely at this solution in the future.  However, EE, and many of its competitors, will continue to gain excessive, unfair profits unless they change the model.

[Doge]

I think this is why EE are not splitting the service and handset on billing as they would not be able to charge so much each year. Applying CPI to what is reality a split bill and credit agreement is obviously going to increase profits without actually any increase in running costs.

After this latest 14% rise I am done with EE, no more upgrading my contract. I am going to see this year out and look at another provider. I've never had a good signal with EE and have to use WiFi calling at home even in a great signal area according to the highly inaccurate coverage map. Never been a fan of O2 but now their split billing is making sense.

[Chris_B]

@Doge   You can have a separate phone and tariff contract with EE just like other networks offer.    But I have feeling that like other networks the phone contract not the tariff is over 3 years.  I don’t know if this can be reduced through.    To have this sort of contract you have to call customer services.