"Three has announced that it's increasing the cost of its pay-monthly phone and mobile broadband plans for existing customers by 3.6% from 16 July. The company claims that the increase results from rising costs due to inflation.

The price increase affects all pay-monthly customers who signed-up to their current deal before 8 March this year. Monthly costs will jump by 3.6%, meaning that a £15 plan will increase by £0.54 a month (£12.96 over a two year contract) and a £41 plan will increase by £1.48 a month (£35.42 over a two year contract).

The increase will be applied to the total monthly package price and won’t be applied to any service add-ons. Pay-as-you-go customers will be unaffected.

Will these changes affect me?

All customers affected by the price increase will receive an SMS, email or letter by 1 June 2012 detailing exactly how much their individual increase will be. The increase will come into effect from the customer’s first bill date on or after 16th July. Customers can also visit Three's website for more information on how the price increase will affect them.

A spokesman for the company told Which?: ‘The increase results from rising costs in Three’s business due to inflation. This is the first increase of this kind that the company has put in place for contract handset customers since it launched more than nine years ago.’

Customers won't be able to leave their contract early as Three’s terms and conditions allow it to raise its prices in line with inflation (in this case the Retail Price Index rate published on 17 April 2012). Customers wishing to cancel their contracts are therefore likely to incur cancellation charges.

Previous price rises

Rival telecom providers Orange and T-Mobile have introduced similar price increases in the last six months. Neither allowed customers to cancel their contracts and regulator Ofcom ruled that they were within their rights to do so."



http://www.which.co.uk/news/2012/05/three-raises-prices-for-existing-customers-286582/

Well they seem to be on very shaky ground. Reading through the extracts from the T&Cs they clearly do give 3 the right to rise prices in line with inflation but they also pretty clearly allow a customer to end the contract without penalty if they do. This could get interesting.