THOUSANDS of customers who took out phone and broadband contracts before this summer could be due compensation.

Ofcom has opened an investigation into whether telecoms providers were honest with customers about in-contract price hikes.

As of today (December 1), the telecoms regulator is investigating a "range of providers" who may have been dishonest about mid-contract price rises.

Companies like Virgin Media O2, EE, BT, TalkTalk, Vodafone and Three dominate the telecoms market.

It's considering whether providers ripped off customers who took out contracts between March 1 2021 and June 16 2022.

These customers might not have been told about bill rises they'd incur when they first opened their contracts.

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If the customer hadn’t agreed to those terms when signing up – because they hadn’t been made clear enough – providers should have notified them of the price increase and offered them a right to exit penalty-free.

If these customers were misled, then they could be owed compensation – though it's not yet clear how much.

The providers may also have to pay a penalty of 10% of their turnover.

Contract price rises are usually applied to customers' accounts in March or April every year. 

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The rules state that phone and broadband providers must include information on how a customer’s contract could increase in the future.

Ofcom will collect further information from a range of providers to assess the steps they have taken to ensure customers fully understood any price hikes in-contract.  

Many broadband companies raise their prices every April in line with the Consumer Price Index (CPI) of inflation, which hit a 41-year high this month, plus an additional 3.7% or 3.9%.

The CPI measures the monthly change in prices paid by consumers on an average basket of goods and services.

Consumers are already feeling the pinch with broadband and phone bills, and more rises are expected next year.

Research from Which? shows consumers could face up to an almost 14% rise on top of already soaring food, fuel and energy prices.

The consumer champion found the average BT customer could see the largest potential increase of £113.07.

Next was EE, whose customers could pay an extra £105.46.

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Vodafone and TalkTalk customers could pay an extra £92.35 and £90.15 respectively.

Plusnet customers could see their bills rise the least by £87.15.

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