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Vodafone ends fixed price promise and re-introduces RPI charge

Posted on Oct 13, 2016.

On the 5th May, 2016 Vodafone ditched its fixed price promise and re-introduced an annual RPI charge as part of a postpay tariff refresh. Vodafone launched its fixed price promise on the 2 April 2015 just over one year ago. In the help section of Vodafone’s website, it states that Vodafone’s Fixed Price Promise “finished on the 5 May 2016 and won’t apply to any contracts – new customers, upgrades and additional lines – starting on or after that date”.

In Vodafone’s new postpay contracts, which also include EU roaming allowances, it has introduced an RPI clause which states: “Each April, your bundle price will increase by an amount equal to the RPI rate published in March of that year. We’ll publish this rate on our website.” At the time of writing, there has not been any major press coverage of this change although a few forum users have picked it up.

A Money Saving Expert forum user wrote: “If you're planning on opening a new line or upgrading your existing agreement with Vodafone it's worth pointing out they now use RPI (like EE, o2, Virgin Mobile and Three UK) to increase your monthly line rental in April of each year using the figures announced in the preceding March. Just thought I'd give people a heads up because I haven't seen it reported anywhere in the media thus far. (Three UK don't apply RPI increases to their SIMO tariffs)”

The general consumer sentiment from limited forum posts is one of disappointment whilst some consumers are stating that Vodafone is using RPI to pay for new inclusive EU roaming.

A Vodafone Forum User wrote: “Disappointed because up until the 5th, Vodafone fixing the line rental was one of the things that kept them different from the competition.”

A Money Saving Expert forum user wrote: “To be honest it seems they are using the RPI increase "trick" to pay for the roaming option they've added in recent days.”

Amir Rehman, Market and Competitor Intelligence, comments: This is the second U-turn that Vodafone has made on RPI having first introduced an RPI charge on 1st November 2012. This was then followed by the commitment not to raise prices in May 2014 which led to the promotion of a Fixed Price Promise from April 2015. The return to raising prices removes a differentiation factor for Vodafone as one Vodafone Forum User wrote, “Vodafone fixing the line rental was one of the things that kept them different from the competition”. However, with Vodafone’s UK mobile service revenue performance declining -2.0% YoY in Q4 15 the additional revenues from RPI may help Vodafone to improve its performance in the future.

See Vodafone forum posts

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