Millions of O2 and Virgin Mobile customers will be hit with price hikes of up to 17.3% on part of their mobile bill. The increase will apply to the airtime part of your contract - so what you pay for minutes, texts and data. This is separate to what you pay for your handset - the price of this won’t be going up. Customers who are mid-contract will see their airtime bill increase from April. Virgin Media O2 uses the Retail Price Index (RPI) measure of inflation for January, plus 3.9%, to determine price rises for the following April.
RPI for January was 13.4% which means airtime bills will go up by 17.3%. Major bank offering new customers free £200 to switch - plus £36 a year cashback. Virgin Media O2 told that the average customer will technically see a smaller rise of 10% overall, due to how it splits bills into airtime and device plans. As an example, if someone had an iPhone 14 Pro costing £53.98 per month for 36 months, they would pay £4.15 more each month. This is because their deal is made up of £29.98 per month for the device and £24 for their airtime - this would mean they pay 7.7% extra.
The 17.3% on airtime bills applies to customers who took out a deal or upgraded from March 25, 2021. Anyone who took out a new deal or upgraded before this time will see their bill go up in line with just RPI of 13.4%. Pay-as-you-go users are unaffected by the price rises.
The broadcasting watchdog is looking into whether mid-contract prices give customers enough certainty about what they can expect to pay. Other major providers including BT, EE and Sky have already announced price rises of up to 14.4% for their mobile customers.