The regulator said it is “concerned about the degree of uncertainty consumers face about future price rises specified in contracts on the basis of inflation”.
Cristina Luna-Esteban, director of telecoms consumer protection, Ofcom, explained, “Inflation-linked price rises can be unclear and unpredictable. So we’re concerned that providers are making it difficult for customers to know what to expect.
“We’re taking a thorough look at these types of contract terms, to understand fully the extent to which customers truly know what they’re signing up to, and whether tougher protections are needed.”
Ofcom added that its preliminary research has found that around a third of mobile and broadband customers do not know whether their provider can increase their price.
Among those who do know their provider can increase their price, around half do not know how this would be calculated. In addition, nearly half of all customers do not know what CPI and RPI measure.
The regulator said its review will examine these issues in detail to see whether tougher protections are needed. It expects to publish our initial findings later in the year.