New regulator rules to save mobile, broadband and TV customers £1bn on bills

14 Feb 2020, 09:27 by Michael Searles

New Ofcom rules set to come into effect from tomorrow could save millions of customers up to £1bn a year on the cost of landline, broadband, TV and mobile packages.

The broadcasting and telecoms regulator is set to enforce rules that require companies to offer customers the best deals available when contracts come to an end.

It is estimated it could save money on these packages for as many as 20m customers throughout the UK who are currently paying over the odds because they are out of contract and unaware of better deals.

Phone, broadband, and pay-TV companies will have to tell customers when their contract is coming to an end, what they are paying and what the best deals on offer are.

“Millions of people are out of contract right now and paying more than they need to,” said Lindsey Fussell, consumer group director at Ofcom. “These new rules make it easier to grab a better deal.”

The biggest savings are likely to come in broadband deals, according to Ofcom, with 25,000 customers a day coming to an end of their contract, which usually leads to an automatic price rise.

In total there are around 8.8m broadband customers out of contract.

The regulator believes these people could save about £100 a year through better deals with their existing provider, and in some cases, savings could be £150, depending on their provider.

For around 1.4m mobile customers, it would see an average saving of £75 a year, rising to £150 for some.

Ofcom also found that those who bundle landline and broadband services together are paying 20 per cent more on average when out of contract if they haven’t shopped around.

It rises to 26 per cent more when pay-TV is added as well.

The new rules will require firms to alert customers at least 10 days and up to 40 days before their contract expires.

They must also state the current price, the price when the contract expires and the best deals available, including those available to new customers only.

This information can be sent by text, email or letter, similar to sectors such as insurance and energy providers.

It comes following a similar crackdown in the home and car insurance markets.