The UK telecoms regulator, Ofcom, has expressed concern over O2’s decision to increase prices for millions of mobile phone customers beyond initial expectations. Ofcom stated it was “disappointed” by this move, which it views as contrary to the spirit of its regulatory guidelines.
Approximately 15 million O2 customers will experience an increase of £2.50 per month in their bills, a rise that is nearly 40% higher than the original estimate of £1.80. This adjustment will elevate the annual cost from £21.60 to £30. The announcement follows recent rules introduced by Ofcom, which require telecom providers to inform customers upfront, in clear monetary terms, about any anticipated price increases during their contracts. These rules were enacted in January with the intent of providing customers with better transparency and to prevent unexpected hikes in prices.
The increase comes amid discussions about price hikes in the telecom sector, particularly after a Guardian investigation revealed that many providers had been imposing significant mid-contract price rises. Martin Lewis, the founder of MoneySavingExpert.com, noted that this action by O2 might undermine Ofcom’s recent consumer protection efforts, raising concerns about potential similar behavior from other telecom companies.
In response, Ofcom has reached out to major mobile providers to remind them of their obligations for fair treatment of customers. They have informed affected customers that they have the right to exit their contracts without any penalties if they wish to avoid the price increases. Lewis suggested that while customers can leave without facing penalties, many are likely to remain and accept the increased charges.
O2, in a statement to BBC News, asserted that it is not in violation of current regulations, indicating that Ofcom’s rules do not prevent companies from increasing annual prices to fund network improvements. The company mentioned it spends £700 million annually on enhancing its infrastructure.
Source: https://www.theguardian.com/business/2025/oct/30/ofcom-criticises-o2-for-going-against-the-spirit-of-new-pricing-rules