TalkTalk Costs More More

Phone and broadband service provider TalkTalk has attracted some critical attention from the media and industry experts alike with a set of new monthly line rental charges due to start on 1 October, 2010.

But is this an attempt by TalkTalk to squeeze their customers a wee bit more, or is it a bit more complicated than that?

The Guardian trumpeted the fact that the TalkTalk monthly tariffs for landline phones are rising by some 5%, moving up from £11.49 to £12.04.

What’s more, to call in the daytime is increasing from 5.8 pence to 6.4 pence, and switching charges for those moving house and choosing to take their landline with them, are going up by over 50%, from £29.99 to £49.99. This would appear to penalise customer loyalty, as well as being a serious cost to the user.

With over five million users in the UK, TalkTalk is a major provider of
telecommunications services and has followed the lead of British Telecom, who have also raised rental charges. In July, the BT monthly line rental charge went up 50p to £12.04.

And for TalkTalk customers late with their payments, the cost will now be £10, not the previous £7.50.

A TalkTalk spokesperson was keen to point out that the company still provides: “...the best value home and phone broadband services in the UK.”

Industry watchers were quick to lament the price increases, saying that once one company started getting away with such hikes – in this case BT – then others would surely follow. They pointed out that this was also TalkTalk’s second round of price increases this year.

And with the imminent rise in VAT, there will be some heavy increases for landline phone customers over the coming year.

But for many industry experts, the move by BT and TalkTalk is purely defensive. As mobiles continue to eat away at the former dominance of the landline, profits from this side of the business will increasingly be under pressure. For now, the only answer that the big providers have is to keep their landline prices on an upward trajectory.

The big money is being made in the mobile market, but the providers cannot yet turn their backs on the landline.

Consumers are being advised to keep their wits about them and look out for ways of protecting their landline deal.