The changing face of broadband

A report by SimplySwitch.com, the price comparison and switching service, has revealed the astonishing rate at which broadband is becoming both faster and cheaper.

Comparing today’s deals to those available in July 2005, SimplySwitch calculates that customers now receive seven times better ‘value for money’ than they did just 18 months ago.

With over 40% of the UK already signed up to broadband, the findings should come as a wake-up call to those customers who have been with the same package for a year or more.

Karen Darby, chief executive of SimplySwitch.com, comments: “The broadband market is incredibly competitive, but even we were surprised at how much it’s changed in a relatively short period. 18 months ago, broadband was fairly expensive and only available up to 2Mb. Connections are now available up to four times faster for an average of just £21 per month. Thousands of people who have been on the same deal for a year or more could switch to a much faster connections and save money in the process.”

Over the past 18 months, every provider showed a vast improvement to the relative cost of broadband. In fact, on average, the suppliers today offer almost seven times better ‘value for money’ than they did in July 2005. With broadband developing so quickly, long term contracts, especially those lasting 18 months, should be viewed as a mixed blessing. By locking customers into long-term contacts, suppliers are able to offer market-leading prices. However, the customer should bear in mind that, by the time they are free to switch suppliers, their deal is likely to be extremely outdated.

Darby says: “With the broadband market developing so quickly, we would like to see customers on rolling contracts that can be terminated at any time without penalty. At the moment, customers can be locked into broadband deals for as long as 18 months. We’ve seen how much the market can change during that period. If broadband continues developing at its current rate, 32Mb could be the norm in 18 months time.

“In the energy market, if a customer feels they’re paying too much or receiving poor service, they can leave their provider at any time. It would be healthy for the telecoms market if a similar practice was put in place, both in terms of maintaining competitive pricing and improving customer service.

“One step in the right direction is that, from 14 February, Ofcom will force suppliers to provide migration authorisation codes (MACs) on request for free. A MAC is a unique reference number that enables a customer to switch broadband suppliers with minimal disruption. Up until now, providers could charge for providing a MAC, which added an extra stumbling block to the switching process.

“From Valentine’s Day, switching broadband should be easier, which is excellent news for the consumer.”