EE and Virgin Media have been fined £13.3 million by Ofcom for overcharging customers who wanted to leave their contracts early.
After an investigation into early-exit fees, the regulator ruled that the two providers had left nearly half a million customers out of pocket by billing them too much for attempting to leave their deals before they'd expired. They also failed to make properly clear how much people would have to pay to leave.
Ofcom rules allow broadband providers to charge customers who want to leave their deals before their agreed minimum contract length has ended. However, the rules stipulate that:
providers must make it clear exactly how much early leavers will be charged to exit their deals in a "clear, comprehensive, and accessible form"
you mustn’t be charged for any saving that the provider makes from not actually having to supply you the service for the rest of your contract
the charges cannot be so high that they discourage users from switching providers
EE
EE has been fined £6.3 million. Over a six year period, around 400,000 EE mobile and broadband customers were overcharged to the tune of £4.3 million. This happened because EE calculated its exit fees based on the full price of a deal, rather than the discounted price customers were actually paying.
The company has refunded £2.7 million to customers it has been able to identify. Ofcom says a further £1.6 million is yet to be returned. As a result of the investigation, EE says it will conduct a thorough review of its systems in order to fully comply with the rules in future. Contact EE if you think you might have been affected by this.
Virgin Media
Virgin Media has been fined £7 million. For almost a year, Virgin charged exit fees that were higher than their customers had agreed to when they signed their contracts. As a result, almost 82,000 people were overcharged nearly £2.8 million. This averages out at £34 per person, although some 6,800 paid over £100 more than they should have.
Virgin Media says it has refunded or made donations for 99.8% of affected customers, and will make further charity donations if they can't track down the rest. The company has now reduced its early-exit charges by an average of 30 percent, and applied an extra reduction to the charges paid by customers who have to end their deals after moving house. However, the company also says it will appeal the fine, describing it as "excessive".
Ofcom's view
Gaucho Rasmussen, Ofcom’s Director of Investigations and Enforcement, said: "EE and Virgin Media broke our rules by overcharging people who ended their contracts early. Those people were left out of pocket, and the charges amounted to millions of pounds. That is unacceptable. These fines send a clear message to all phone and broadband firms that they must play by the rules, in the interests of their customers."
Loyal customers who stick with their broadband provider end up paying on average 43% more than if they had switched.
Research by Citizens Advice has cast a light on the way the major providers hike their prices once a contract has ended. Customers who choose to keep their existing deal instead of shopping around find themselves paying an average of £113 extra each year in what has been dubbed a "loyalty penalty".
Citizens Advice analysed the cheapest broadband deals from the UK's five largest suppliers. They found that Virgin Media was the only one that did not bump its prices at the end of the initial contract period. The other four saw increases of as much as 67%.
BT - the price rises from £24.49 to £40.99 after 12 months. An increase of 67%, amounting to £198 per year.
TalkTalk - the price goes from £20 to £25.50 after 24 months. An increase of 28%, or £66 per year.
Sky - after 12 months the price rises from £18.99 to £28.99. An increase of 53%, or £120 per year.
EE - the price rises from £21 to £28.50 after 18 months. An increase of 36%, amounting to £90 extra per year.
Virgin Media - the cheapest deal is £32.25 per month for 12 months. The price doesn't rise at the end of the contract.
The report found that more than a third of customers didn't realise that prices could go up once their contract had ended. It also found that customers stay on the same deal for an average of four years, which ends up costing them as much as £594 extra.
Those over 65 or on lower incomes were significantly more likely to stick with a deal for more 10 years.
Time to switch
The study highlights the fact that it's more important than ever to shop around for the best broadband deal. Our Ofcom-approved price comparison service helps you find the best and cheapest packages available for your postcode.
Switching broadband providers is easier than you might expect. In most cases, your new provider will handle all aspects of the switchover. You should experience no loss of service, and you won't even need to inform your old supplier that you're leaving. Read our guide to switching broadband providers to see how the process works.
Citizens Advice is calling for greater clarity in how providers advertise their services, and also to inform customers by text when the fixed price comes to an end.
Gillian Guy, chief executive of Citizens Advice, said, “People often choose their broadband deals based on the price that works for them - but our evidence shows that many do not realise the price will rise after the end of the fixed deal. The government has rightly put energy firms on warning for how they treat loyal customers - the actions of broadband firms warrant similar scrutiny. Extra protections for vulnerable consumers are also a must.”
The moral of the story is clear: loyalty doesn't pay. Once your contract is up, find a new provider. There are some incredible deals to be had on both standard and fibre broadband, and if you're lucky you might even bag an awesome free gift at the same time.
If you find broadband speeds confusing, you're not alone. What speed broadband providers advertise and what you actually get are rarely the same thing. The ASA has recently announced that it will be taking steps next year to bring clarity to the entire issue.
But that's a way off. In the meantime there are steps you can take to ensure you achieve speeds closer to what you were expecting.
You may not know that your Wi-Fi router can have a massive impact on the internet speeds you get throughout your home. Since the provider supplies the router we tend to assume that they're automatically good enough. But that isn't always true - sometimes they're old or slow, and not capable of handling a superfast broadband connection.
In these cases, upgrading to a more powerful router can help speed up your broadband dramatically.
How a new Wi-Fi router can help
Let's start with the technical bit.
The performance of a router is determined by the wireless standard that it uses. The best modern routers use the latest standard, called 802.11ac. It's the fastest available, and it runs on the 5GHz band which is clean and interference free.
802.11ac superceded the 802.11n standard. This is much slower - perhaps half or even a third of the speed - and it commonly runs on the 2.4GHz band which is much more prone to interference from other electrical devices in your home. As a result, the signal is not just slower but it gets much weaker the further it travels.
The router as a bottleneck
Many broadband providers supply an N-rated router with their packages, and it may not be up to the job. Tests show that 802.11n routers have a real world top speed of 50-100Mb, at close range. At a distance of 20 metres, and with a few obstacles like walls and floors in the way, that speed can be slashed in half - or worse.
So, if you've got a high-end fibre package and are getting speeds of 50Mb or more, then an N-rated router simply won't cut it. Your broadband is faster than your router, and the router becomes a bottleneck. Even on an entry-level fibre deal, with speeds of 25Mb, you'll be pushing it. You might find you get good speeds downstairs, but that they fall off sharply in the bedrooms.
In both cases, upgrading to an AC-rated router is likely to give you a major speed boost. The exception is standard broadband. Here, the speeds top out at 16Mb, and in practice are usually somewhat slower. An N-rated router should be able to handle this.
An easy way to check if you're affected is to use our free Speed Test tool. Stand next to your router and run the test on your laptop. Then head to the furthest corner of your house and run it again. If there's a major discrepancy in your results then it could be a sign that you need to upgrade your router. (Or it could mean you need to find a better position for your router.)
Do you need a new router?
You can see why a slow router can mean you don't get the broadband speeds you were expecting. So do you need to upgrade?
When you're shopping for broadband deals, all our comparison tables have icons to show what kind of router you're getting. Click the More Info button to see whether there's an option to upgrade to a better router when you sign up.
What router do you get?
Many of the major providers now supply AC-rated routers with all their packages. This includes TalkTalk, Vodafone and Virgin, while Sky also provides the new Sky Q Hub if you are a TV customer.
BT, Plusnet and EE supply 802.11ac routers with their fibre packages, and N-rated routers with standard broadband. BT offers a paid upgrade for standard broadband customers, but the other two don't.
Origin customers get an N-rated router, and need to pay at checkout to upgrade to a faster AC-rated unit.
If you've been with a provider for some time it's possible you're still using an older N-rated router and aren't getting the fastest possible speeds from your broadband. In this case it's worth checking with the provider to see if they'll swap your router for a newer model for free. Some may give you one in exchange for you signing a new contract. Just make sure you know exactly what you're getting, and that you aren't charged or placed on a new contract without knowing.
Lastly, a handful of providers, including Plusnet, Zen and Origin, allow you to use own router, so you can shop around and check independent reviews to get the best model for your needs.
The router is a frequently overlooked part of the broadband service. It's natural to assume that broadband problems are the fault of the provider, but the reality is that if your router is too slow you can easily be cutting your internet speed in half without even realising.
Give your router a quick check now to see if you would benefit from an upgrade.
Each month hundreds of thousands of broadband customers test their speeds with our broadband speed test. Since the end of 2015 there's been little change in average speeds from home broadband with average download speeds for March 2016 coming in at 20.41Mb and average upload speeds at 3.73Mb.
However, our test also supports users testing on tablets and smartphones, meaning we can report on mobile broadband speeds from 4G and 3G networks. While home broadband has been stable, mobile broadband average download speed has risen by a full 2Mb since December and upload speed by 1.6Mb, the average mobile broadband speeds for March 2016 were 15.31Mb download and 3.71Mb upload.
When the big mobile broadband and home broadband providers' average speeds compete on the same table, it's only Virgin Media's DOCSIS 3 cable broadband that outperforms mobile broadband, clocking in 46.95Mb, with upload speeds at 5.9Mb.4GEE is ahead of BT Broadband with download speeds clocking in at 18.71Mb, faster than BTby 1.07Mb. 4GEE and Vodafonemobile broadband sit in overall 2nd and 4th places beating all home big broadband providers' averages bar Virgin Media, with Vodafone's 16.26Mb average mobile download speed only 1.38Mb behind BT.
Of the home broadband providers Post Office Broadband still has the UK's slowest broadband speed overall with only 4.38Mb average downloads and 1.67Mb average uploads, well below the average speeds expected for copper phoneline broadband. Three tested with the slowest mobile broadband at 12.09Mb downloads, but this still beat home broadband offerings from Sky and EE.
When the supplementary broadband providers table (see page 4 of the report) is included we can see that fibre to the building provider Hyperoptic tested as the fastest broadband overall with 91.7Mb average downloads and 77.3Mb uploads.
February 2015 saw average download speeds recorded by users of our Broadband Speed Test drop by 0.48Mb in comparison to the results from January, coming in at 21.43Mb. Average upload speeds saw a 0.23Mb increase to 4.32Mb.
Virgin Media's average download speeds dropped again by 0.63Mb to 40.98Mb, with upload speeds remaining stable at 5.5Mb. BT Broadband remain second place with average download speeds dropping by 0.53Mb to 19.87Mb, though upload speeds increased by 0.29Mb to 5.97Mb. Plusnet hold third place, remaining stable at 15.74Mb for average download speeds with a 0.38Mb increase to 4.78Mb for average upload speeds. TalkTalk are also stable in fourth place, with download speeds at 13.22Mb and upload speeds at 1.75Mb. Finally, Sky are in fifth place with a strong 1.34Mb increase to download speeds, putting them at 13.37Mb, with upload speeds increased by 0.49Mb to 3.44Mb.
After the popularity of our previous exclusive offer with EE, Broadband.co.uk is pleased to announce a new exclusive offer of £50 Amazon.co.uk gift vouchers with all EE Home Broadband deals. This voucher can be combined with current EE offers, including:
Up to 17Mb standard unlimited home broadband only £2.50 for 12 months
Standard up to 38Mb unlimited Fibre broadband £5 for 3 months
Unlimited Fibre Plus £15 for 3 months with speeds up to 76Mb
As an added bonus, EE's cheapest deals are now available to all customers in their network area, not just EE, T-Mobile and Orange mobile phone and mobile broadband customers, and all EE broadband customers will be able to take advantage of perks like EE Film 2-for-1 cinema tickets on Wednesdays.
Voucher only available online. Line rental required, available from £11 monthly equivalent price if paid a year upfront. Quoted prices and features may only be available in EE network areas. Speed achieved depends on factors such as your distance from the telephone exchange, you will be provided with the fastest connection available. Full details will be provided before you sign up.
March 2014 saw the national average download speeds recorded by users of our Broadband Speed Test surpass 20Mb for the first time, with most providers seeing a healthy speed increase and a 3.53Mb rise overall, bringing the UK average speed to 20.63Mb. Average upload speeds also saw an increase, rising by 0.39Mb to 3.45Mb overall.
Virgin Media's average download speeds increased significantly over the previous month, rising by 4.94Mb, and they retain first place at the top of the speed table at 38.19Mb. Upload speeds were also up by 0.44Mb averaging at 4.14Mb.
Early last month Virgin launched their boost from up to 120Mb to 152Mb, from up to 60Mb to 100Mb and from up to 30Mb to 50Mb, which has undoubtedly contributed to their average download speed increases. While the boost was initially for new customers only, these average speed increases are set to continue as Virgin roll out the higher speeds to existing customers over the next year, with customers in several areas already enjoying the boost.
BT Broadband came in second place on the speed table, with a download speed increase of 2.13Mb taking them to an average speed of 22.33Mb. BT also saw an upload speed increase of 0.56Mbps, with uploads now averaging higher than Virgin at 5.47Mb, in part thanks to the higher upload speed of BT Infinity 2 compared to Virgin's maximum.
EE have taken third place, overtaking both Plusnet and Sky with average download speeds of 14.21Mb (an impressive 4.55Mb increase over last month).
EE have started traffic shaping to prioritise web and streaming traffic, allowing them to last month announce a new headline speed of up to 17Mb. At least 10% of their customers have to be able to achieve this speed in order for them to advertise it, making them faster than any other standard UK phoneline broadband supplier! We're currently running an exclusive £70 Amazon gift voucher offer with EE that stacks with their reduced price offers. It's a limited offer for this week only, so hurry to take advantage of it!
While Plusnet have dropped into fourth place, their average download speeds have actually improved by 1.47Mb, taking them to 14.13Mb. Similarly, Sky have dropped to fifth place, but have a 0.86Mbps increase in download speeds, averaging at 11.2Mb. As spring arrives with sunnier weekends and brighter evenings, we'll likely see further small increases across all providers as peak time congestion from video services reduces due to more people en. The availability of higher speed fibre services also continues to roll out to more exchanges.
Broadband.co.uk has secured an exclusive £70 Amazon.co.uk gift voucher offer on all EE Home Broadband deals. This offer combines with EE's existing offers, including:
£10 monthly discount for EE, T-Mobile and Orange mobile phone and mobile broadband customers
Up to 17Mb standard unlimited home broadband only £2 for 12 months
Fibre optic broadband half price for 6 months, from £8 a month for up to 38Mb unlimited fibre
EE's headline speed for standard broadband has also recently increased from 16Mb to 17Mb thanks to traffic shaping to prioritise web and streaming traffic at peak times, making EE the fastest phoneline broadband on the market.
Voucher only available online. Line rental required, available from £11 monthly equivalent price if paid a year upfront. Quoted prices and features may only be available in EE network areas. Speed achieved depends on factors such as your distance from the telephone exchange, you will be provided with the fastest connection available. Full details will be provided before you sign up.
Fourth Generation (4G) mobile services have finally arrived in the UK, allowing users of mobile broadband to take advantage of the faster speeds now available to them. With download speeds of up to 40Mbps and upload speeds of up to 12Mbps in 4G-enabled areas, a whole new world of possibilities opens up for mobile broadband users, allowing them to potentially stream TV and HD video on the go. It's good news for gamers, too. 4G has lower latency, making games more responsive and reducing that annoying lag that can plague gamers at crucial moments.
So, where is it currently available? As of the end of March 2013, 4G coverage is available in 50 towns and cities around the UK, with plans to cover 70% of the UK by the end of 2013, and 98% by the end of 2014. Some of the areas with 4G available already include Birmingham, Bristol, Cardiff, Derby, Edinburgh, Glasgow, Leeds, Leicester, Liverpool, London, Manchester, Newcastle, Nottingham and Sheffield.
To find out if 4G mobile broadband is available in your area, just pop your postcode into EE's handy coverage checker.
If you're interested in 4G, then you'll need a provider. EE are currently the only supplier of 4G services in the UK. Their services went live in October 2012, and they have a range of packages available to suit customer needs, from USB dongles for individual laptop users, to WiFi routers for multiple devices on the go, to packages including iPads for those who want the convenience of a tablet while out and about. However, EE won't be the only 4G suppliers on the market for much longer, meaning customers will have more choices for 4G suppliers available to them in the near future. BT, O2, Three and Vodaphone will also be offering 4G mobile broadband plans at some point this year, likely from the Summer onwards.
Interested in getting 4G mobile broadband? Check out our handy 4G mobile broadband comparison table to find the best deal for you!
November 2012 saw average download speeds recorded by users of our Broadband Speed Test drop in comparison to the results from October, coming in at 17.1Mb. Average upload speeds remained stable at around 2Mb.
Virgin Media's average download speeds have decreased by 1Mb over last month to 32.39Mb with upload speeds remaining stable at 2.62Mb. BT Broadband takes second place with download speeds averaging at 15.57Mb (a 1Mb increase over last month) and upload speeds of 3.45Mb. Eclipse drops to third place with a 2Mb decrease to 15.1Mb for average download speeds, and a 0.5Mb decrease to 2.75Mb for average upload speeds. Plusnet came in at 4th place with 11.94Mb download, a small decrease in speed since last month.
Orange are now trading as EE, and speed test results only include numbers from their fixed line broadband packages, and not their 4G mobile broadband packages.
