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1.6% vs 20% increase

I had a letter stating the price of my tariff is going up by £3.50 thats nearly 20% of my current full rate excluding discount. I currently pay £13.50 (discounted allegedly from 18.50).

This webpage says all but Freestyle plans will be going up by 1.6%


Your Virgin Media mobile tariff is changing

Your monthly mobile tariff price will go up by 1.6% from 1st July 2016 – this is in line with the Retail Price Index (RPI) rate of inflation announced in April. This change will appear on your first bill on or after that date.

If you're a Freestyle customer, this price rise will only affect your airtime tariff (data, minutes and texts). The cost of your phone repayments will stay the same.

You'll still get all the data, minutes and texts you get now.

So my bill should be £18.76 less £5 or £13.76.

Whats going on?  Its already gone up by £1.50 so effectively 100% of the discount has been removed in less than 24 months. This is a SIMO deal so profitable.  For less money you even offer tariffs offering a new iPhone 5s. In which case, when the bill goes up I should expect a free iPhone in the post too!

Can you clarify if the price increase is 1.6% OR 1.6% unless you still aren't happy with the margin in which case its an arbitrary increase?

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