Prices set to rise for BT customers

BTAround 10 million BT customers are being told that phone and broadband prices are to rise by up to 6.5% in another blow to households struggling with soaring utility bills.

BT is hiking its prices from January 4, but denied the move was linked to its push into sports broadcasting, which is seeing the firm muscle in on Sky's dominance of sport after winning a three-year deal to show 38 Premier League games a season.

The increases follow the group cutting the price of broadband to £10 for copper and £15 for fibre, and giving away BT Sport for "free" with broadband.

Line rental will go up by 54p, or 3.5%, a month to £15.99, and other prices such as set-up fees and price-per-minute rates will increase by around 6%.

The main calls packages BT sells now will remain the same price but existing customers on older tariffs will see a rise of around 6%.

And the formerly free BT Answer 1571 and BT Privacy with Caller Display will cost £1.75 a month.

Broadband prices will increase by up to 6.5%, although the current broadband offers will remain at the same price including broadband and weekend calls for £10 and Infinity and weekend calls for £15.

Mobile calls will be unaffected.

Today's announcement follows a 9% hike in the cost of BT's Line Rental Saver Plan, which allows customers a better deal by paying in advance, from £129 to £141, which took effect from June 1.

BT is notifying customers about the bill changes from this month.

The move follows its rival, Sky, increasing some tariffs on September 1.

BT's profits were up 5% to £595 million in the quarter to June 13, while it added 95,000 broadband customers in that period.

It is offsetting mammoth investment by cutting costs and recently said it was looking to make savings of around £200 million a year. It is expecting £400 million in "specific restructuring costs" in the current financial year.

Staff are expected to be affected after BT said this would involve some "people costs" as some employees would be given "the option to pursue other activities". But no compulsory redundancies are expected.

A BT spokesman said: "BT will be updating some of its prices from January 2014, following a summer in which we slashed the price of our entry level broadband for new customers by up to 12%.

"We are writing to our customers to let them know about these changes and to make it clear how they can save money via various deals.

"These price changes are not linked to the launch of BT Sport. We revise our prices every year in what is an intensely competitive market and whilst some go up, others come down.

"Our customers have seen their calls bills fall by 14% on average in the last five years as a result of us slashing the price of inclusive calls plans. We want customers to move on to those plans as they can save money. Hopefully these changes will encourage that."