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[UncleUB]

BT dish out their annual rip off line rental increases...


http://www.ispreview.co.uk/index.php/2015/07/uk-isp-bt-kicks-off-new-round-of-annual-phone-line-rental-price-hikes.html#comment-157560

Well someone has to bear the cost of BT sports and all the mega rich pundits that come with it..

[Ronski]

Unfortunately Plusnet are also upping theirs from 2 September  Fortunately I do get £5 a month discount due to referrals.

[renluop]

Noted that in the comments one poster must be a second twice removed of our beloved leader. The name is so close.

[kitz]

The whole industry when it comes to pricing is screwed.   The fault of this one is the Service Providers and not Openreach or BT wholesale.

I mentioned in another thread pretty recently how the ISP's prices are very unclear and it makes it exceedingly difficult to compare true pricing because just about every single ISP tends to offset the cost of one service against another.   Without doubt consumers are being ripped off when it comes to landline prices.  The merging of products and allowing the ISPs to offer packages has allowed them to do this.

If we look at the 2 core components that most people purchase then they comprise of :

1) Line Rental.
This is the basic cost of a phone line.   Because xDSL needs a copper pair to work then we must have a phone line.
When it comes to the phone element, then for the Service Provider this is easy money and there's no huge additional overheads. Compared to xDSL there's a heck of a lot less that goes wrong and consumer support in this area is minimal.

2) Broadband
The addition of xDSL broadband over the copper pair. Setting up an ISP is much harder than selling line rentral.  There are a lot of additional costs in addition to the basic fee charged by BTwholesale.  The ISP has to provision bandwidth (which is expensive) and additional requirements such as ISP gateways and backhaul provision run into the millions. They also have to have some form of transit on to the Internet and provider peering.  This is before you even start on such things many consumers expect such as email servers etc.
When it comes to support on broadband this is high maintenance and far more customer support is needed and far more 'faults' are reported when it comes to DSL.


Yet when we look at the costs of these two elements, BT wholesale/Openreach have not increased their basic prices for either for many years - in fact quite the opposite as prices have come down for both.

Broadband
These are the basic costs to the SP for xDSL - dont forget that this is just to connect and that there are a lot of additional expenses for the ISP to ensure that traffic gets further than the exchange or bRAS.

Code: [Select]

BT Wholesale port costs for ADSL

WBC
01/01/2010 £5.88 adsl/adsl2+
FTTC
20/01/2010 £13 40/2
20/01/2010 £14 40/10
11/04/2012 £16 80/20

Line Rental

Code: [Select]

BTw/ Openreach Basic Line Rental (Ex-VAT)

01/03/2006 100.68
01/04/2010 103.68
01/04/2012 98.81
01/04/2013 94.75
01/05/2013 93.27
20/12/2013 93.32
17/05/2014 96.17
01/07/2014 91.05
01/04/2015 89.50

So that works out at £107.40pa inc VAT or £8.95 per month and the cheapest its been since 2006.  Yet the SPs continue to increase their line rental prices year after year.

Using Marks figures

History of BT Phone Line Rental Rises
2011 = £13.90
2012 = £14.60
2013 = £15.45
2014 = £15.99
2015 (Dec 2014) = £16.99
2016 (September 2015) = £17.99

The other ISPs are just as bad because once BTretail put theirs up then they all soon follow suite.  So why when the wholesale costs have come down, but we all pay more. *



TBH I think it would be far better for the consumer if the likes of OFCOM made this particular area clearer and stopped the SPs from cross-subsidisation of products when it came to packages.  IMHO it would be much better if they had to display their core cost and then offered a clear discount if you purchase multiple products so the actual bill would look something like this

£15.00   Line Rental
£ 9.99   adsl broadband
-  .50   less multi-product discount
______
£24.49   Amount due


£15.00   Line Rental
£20.00   FTTC broadband
£ 5.00   TV services
- 1.00   less multi-product discount
______
£39.00   Amount due
 
I'm sure this would be more beneficial to the industry and consumers rather than the splitting off of Openreach.




-----
*Inflation figures obtained from Which

[kitz]

Noted that in the comments one poster must be a second twice removed of our beloved leader. The name is so close.

Nope not me or a relation. We've many times been confused in the past because of the name similarity.
With her also being a cat-lover and using cat avs...  and iirc she also lives up in the NW..  plus we are both females,  you can see why people sometimes jump to the conclusion we are. 

[burakkucat]

b*cat thinks that our Leader should send a copy of Reply #3 to Ofcom . . . ensuring that it is in large emboldened text.

 

[WWWombat]

The whole industry when it comes to pricing is screwed.   The fault of this one is the Service Providers and not Openreach or BT wholesale.

Fully agree there.

I never take account of the initial discount when making ISP choices, because my intention is to be there a long time, and not swap. I need quality of provision, with no downtime ... and that precludes adding the risk of downtime caused by a change of provider.

If we look at the 2 core components that most people purchase then they comprise of :

1) Line Rental.

...

2) Broadband

Personally, I think of the entire shebang as being made of more components, although they aren't ever itemised this way on any bill:

1) Copper Line Rental - the physical communications medium
2) Voice Service, Access Rental - the cost of a port on a voice switch/exchange
3) Voice Service, Usage Charges - the cost of making calls over the voice exchange
4) Broadband Service, Access Rental - the cost of a port on a data switch
5) Broadband Service, Usage Charges - the cost of actually transferring data

The problem is that an ISP's "package" is never offered in this way. An ISP will often offer two broadband packages - one that incorporates cost (4) and limits cost (5) to small amounts of data, and one that incorporates cost (4) and an unlimited (5). No real problems there ...

However, the charge that we know today as "Line Rental" does the job of cost (1) and cost (2); and BT (and all others) currently insists upon a "line rental". Most people only complain about the (lightly used) service (2), but forget about (1). Unfortunately, xDSL needs, and will always need, cost (1).

TalkTalk, in their UFO offering for York, talks of taking away the "line rental", and having a single charge. That, of course, just mixes the different costs together even more. It plays to people's perception of removing the unwanted "line rental", even though the reality is that it just means an itemised line isn't printed on the bill.

That leaves us with cost (3). In the old days, this was just a per-minute charge for a call. Then came bundles of Evenings+Weekends, or Anytime, or Mobile etc. Then calls got split into a setup+duration fee. Some places (eg Plusnet) seem to charge extortionate amounts for setup+duration, presumably with the aim of making you opt for a bundle instead. Places like pulse8 retain the old-fashioned per-minute charges at old-fashioned prices.

The real problem is that the volume of calls is going down *hugely*. Saffy's recent article on TBB has these images to show:


Without the "hidden" income from (3), the ISPs have little choice but to extract their income from subscribers elsewhere. As the fight (in comparison sites) is on the headline broadband price, incl discount-de-jour, today's "line rental" gets the hit.

It'll be interesting to see how the Openreach "naked DSL" offering comes out to subscribers. I'm sure it won't actually be much cheaper at a retail level - my interest will be focussed on how the marketers attempt to sell the package as one "without line rental" ... but with just as much money going into their coffers.

From this point, the next step will be the switch to selling the voice service as something carried over IP - especially as circuit-switched SystemX and AXE exchanges reach end-of-life. It'll be just as interesting to see how marketers can get people to realise that "line rental" was more about the line itself, than voice.

The one thing I think we can expect is that billing will still not be simple.

[kitz]

I totally agree with all you say.   In particular the GP's conception about line rental and how cost (1) will always be needed.  As you say the TT York offering only confuses things further.  I doubt that the costs will ever be broken down into such a way for presentation on the bill.   The ISP's seem to like cross subsidisation because it does make them look good on comparison sites.

The one thing I dislike about the comparison sites is that its mostly aimed at just showing the so called dsl component.. and often shows the discounted period as a headline grabber.   It would be much fairer to show total annual cost..  and also ongoing annual cost for the full package.

[WWWombat]

Incidentally, the topic is "That time of year when.."

Anyone notice how "that time of year" seems to be getting earlier and earlier?

[UncleUB]

Incidentally, the topic is "That time of year when.."

Anyone notice how "that time of year" seems to be getting earlier and earlier?

Yes...I'm sure BT use to increase their prices around December and Sky (who increased their tv packages in June)use to be September.I wonder when next years increases will come in and surely it will come to a point when enough is enough as line rental is now approaching the £20 a month mark,which in many,many cases is just to be able to have an internet connection with no actual calls made via the land line.
I myself never make a call using our land line and my OH probably makes 2 a month.

[kitz]

yep... Im sure it always used to be announced in Dec to take effect in Jan.  Although going back further to Plusnet in the early days I seem to recall it was April (tax year)
As you say its slowly been creeping forward

[Weaver]

I don't pay BT anything (directly) anymore. I fell out with the company after the Phorm scandal some years back, but I've since started to forgive them.