BT, EE and Plusnet have brought back broadband set-up fees
If you are shopping for broadband this week, there is a line on the order that was not there a month ago. From 31 July, new BT and EE customers pay a one-off set-up fee of £30. New Plusnet customers pay £20. Both changes were reported by ISPreview and Money To The Masses. Uswitch’s reading is that up-front set-up charges had all but disappeared from broadband-only deals over the past decade, which is why a fairly small number is getting a lot of attention.
BT Group says the charge covers the router that has to be posted out, plus activation and installation, and it points at hardware costs rather than margins. ISPreview reports memory prices as the main driver, with DDR memory up around 300% on last year. The group had absorbed those costs for several years before this.
Who pays is the bit to read twice. New customers of the three brands do. If you are part-way through a contract with BT, EE or Plusnet, nothing changes for you: the fee attaches to a new sign-up, not to a line already running. Recontracting is where the coverage stops agreeing. Some reports treat an existing customer taking a new deal or an upgrade as a new sign-up for fee purposes, and others describe existing customers as unaffected. That is not settled enough for us to state as fact, so ask before you sign, and ask for it to be waived.
Thirty pounds is small against a year of bills. It also lands before the connection is switched on, which changes how a cheap headline price compares with a slightly dearer one. Comparison sites have not been kind. Uswitch’s Ernest Doku called it a badly misjudged move and said there should not be a price of entry to saving money on your broadband. Alex Tofts at Broadband Genie said asking a customer for £30 before their connection is even on is a clear barrier for many bill payers. Broadband Genie also raised something nobody has answered yet: whether the fee comes back if you cancel inside the usual cooling-off period.
So when you compare deals now, read the set-up line as well as the monthly price, and count it into the first year rather than filing it as admin. Some providers charge one, some do not, and the only way to know what your street is actually offered is to look. Start with the availability checker. If you have never moved to a smaller network before, our guide on how switching to an altnet works covers what carries over and what does not.
What we will be watching is whether the rest of the market follows. When one large group brings back a charge everybody else dropped, it tends to stop looking unusual, and the next round of price rise announcements is where that would show up.