Warning to 15 million O2 mobile customers after major change

Over 15 million O2 customers could see their phone bills soar by 40% more than expected because of a new mid-contract policy change. The phone network emailed users on Wednesday to say it would be increasing the price of their contracts by £2.50 a month from next April despite previously promising monthly prices would only rise by £1.80.

Ofcom, the UK's media regulator has criticised O2 for not being transparent about the price rise, with a spokesperson sharing that they had written to the company, "reminding them of their obligations to treat customers fairly".

"We encourage any customer who wants to avoid these price rises to exercise their right to exit without penalty and sign up to a new deal," they told the BBC. The change means phone bills will rise by £30 a year, up from the £21.60 currently written into their contracts.

Consumer expert Martin Lewis said he was "up in arms" over the change which he suggested was "making a mockery of Ofcom" on his self-titled podcast.

"O2 customers' prices are going up - but likely it means the door is open for all of us to now see prices [rise] by more than we were told when we signed up," he added.

Ofcom introduced new rules to stop phone companies from raising prices mid-contract without warning in January. However, O2 insisted that it had not breached the regulations, which it said "do not prevent companies from increasing annual price changes - for example, to invest in improving networks".

Ernest Doku, of price comparison website Uswitch, told the Daily Mail: "This move puts O2's mid-contract price rise at the higher end of the scale of mobile providers' increases to date.

"With different networks taking changing approaches to price increases, it's never been more important to compare deals available to you to make sure you're getting the best [one]. Since the increase applies to new and existing users, O2 customers don't have to put up with this increase and can leave their contracts penalty-free."

An O2 spokesperson said: "With demand for mobile data at an all-time high, we're introducing a 70p per month increase to annual price rises for O2 customers, effective each April. An annual rise of £2.50 a month - around 8p a day - continues to represent excellent value for services that customers are using more than ever before.

"We've again frozen prics on handset repayment plans and are investing £700 million into our mobile network this year to ensure we meet growing demand and give our customers the fast and reliable connectivity they rely on. Customers on our social tariffs continue to be exempt from any price changes as part of our efforts to provide support to those who need it most."