MILLIONS of O2 and Virgin Mobile customers could see their bills rise by around £50 a year.
Virgin Media, the owner of both mobile networks, has informed its customers that bills will rise from April 1.
O2 and Virgin Mobile bills will rise on April 1
Customers on sim-only contracts will see their bills rise by up to 17.3%.
And the airtime part of pay-monthly contracts which excludes the handset costs will rise by the same figure.
Virgin Media O2 uses January’s retail price index of inflation plus 3.9% to determine its mid-contract price rises.
RPI is a measure of inflation that tracks the cost of a fixed basket of goods over time, to see how prices have fallen or increased.
And with January’s retail price index at 13.4% it means millions will see their bills increase by 17.3%.
Telecoms giants use a loophole in contracts which allows them to raise prices annually.
The exact amount you pay will depend on how much your bill is now, but for some, the hikes could add up to £50 a year more onto bills.
A Virgin Media O2 spokesperson said: “We know that price increases are never welcome but, unlike other providers, we freeze the cost of device repayments and are only changing our airtime prices, meaning average bills will go up by an effective 10.0% or less than 10 pence per day.
“This is below inflation and reflects the fantastic value we provide for connectivity that is used almost constantly.
“These changes occur as our own business costs rise and we invest heavily in our mobile network to keep pace with ever-increasing usage, roll out new technologies like 5G and deliver valuable services that matter to our customers.”
It comes as BT, EE and Three have also announced mid-contract price hikes in recent weeks.
But the jump in prices comes as Brits struggle with the soaring cost of living.
Virgin Mobile customers will begin moving to O2 in March as the telecoms giant looks to consolidate its mobile business under a single brand.
We explain how much your bills are set to rise this year depending on your provider.
O2
O2 customers are facing hikes of up to 17.3%, but it could be less if you’ve been with the network for more than a year.
If you joined before March 25 last year you don’t have to pay the extra 3.9% – so the rise will be capped at 13.4%.
If you’re a pay monthly customer the rise will only be applied to the “airtime” portion of your bill, not the device.
For example, an iPhone 14 Pro with an airtime plan with 20GB of data currently costs £53.98 for 36 months.
Of that, £24 is the airtime portion, which is impacted by the 17.3% rise.
That means it will increase by £4.15 a month or £49.80 a year.
Virgin Mobile
Virgin Mobile contracts are also split into airtime and device plans.
But all Virgin customers will get the full 17.3% rise, no matter when they signed up.
The most popular Virgin Mobile airtime tariff is £6 a month for 5GB of data.
A 17.3% increase on that would be an additional £1.04 per month – or £12.48 annually.
To work out how much your bills will increase, check how much your airtime tariff is.
You will be able to find this by logging into your online account.
Then multiply this number by 1.173 – this will give you your new monthly tariff.
How can I cut my mobile bill?
If you think your bills are too high and want to drive them down, the first thing to do is find out what the cheapest deal on the market is.
You can use this rate as a bargaining tool to get a better offer with your provider.
Get in contact with your provider to see if they can match this rate – if not, you might want to switch instead.
If you’re mid-contract though and wish to leave, bear in mind that you could face an exit fee so check with your provider for any charges.
Plus, it could be harder haggling with these prices as they come most years from all providers.
And if you’re out of contract, switching when yours is up is the single best way to save money on your telecom bills.
In the weeks before your contract is up, use comparison sites to familiarise yourself with what deals are available.
It’s a known fact that new customers always get the best deals.
Sites like MoneySuperMarket and Uswitch all help you customise your search based on price, speed and provider.
This should make it easier to decide whether to renew your contract or move to another provider.
If your household is on a low income it’s also worth investigating social tariffs.
These broadband packages and discounts have been created for people who are receiving certain benefits.
They’re often available to those on income support, Universal Credit, or disability allowance.