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Customers are being "held captive" by Broadband services when they try and cancel or change their plans, the Citizens Advice Bureau said.
In the last year alone CAB received more than 3,300 complaints about internet and broadband problems. More than half of these related to sub-standard service.
CAB Chief Executive Gillian Guy said: "People are finding themselves held captive by bad broadband services.
"Internet service providers must not shackle customers seeking a better service with unreasonable fees that can turn into shock debt.
"All internet users need to be able to easily have a way out of inadequate contracts and broadband speeds that only give them daily frustration."
Broadband customers are being hit with cancellation fees of up to £625, the Citizens Advice Bureau has warned.
The consumer charity said consumers who challenge the fees soon found themselves in the hands of debt collectors.
Other customers became locked into a broadband service which did not meet their needs or were hit by excessive fees when they tried to switch providers.
One woman was hit by a cancellation fee, even though it was not in the terms and conditions of her contract, when she tried to switch provider after her broadband speed became so bad that she was paying repeatedly to use an internet cafe.
Citizens Advice chief executive Gillian Guy called on internet service providers (ISP) to "not shackle customers" and ditch cancellation fees altogether.
UK Broadband has launched a new service that "does not require a landline" in order to operate.
The internet service provider has unveiled a new service, called Relish, which will supply London with "fibre-fast speeds" of internet access for customers - without a phone line.
The Relish service includes a traditional router, which only needs to be plugged into a power source to access the internet, eliminating the need for a landline.
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BT is "not impacting on rural communities" despite winning all of the rural broadband contracts from the Government, the head of an influential committee has said.
Labour's Margaret Hodge warned other competitors "might be squeezed out" of the rural broadband market by BT's dominance.
Whilst BT claims it is making further concessions, this is not impacting on rural communities.
Local authorities are still contractually prevented from sharing information to see if they are securing best terms for the public money they spend.
Communities can still not access the detailed data they need to understand whether they will be covered by BT's scheme in their area.
Other broadband providers might be squeezed out of the rural market by BT's actions.
BT has an "effective monopoly" over rural broadband after the Government awarded all of the 44 contracts from the £1.2bn scheme to the telecommunications giant, a group of influential MPs has said.
In another another scathing report of the rural broadband scheme the Public Accounts Committee (PAC) said the way it had been set up "failed to deliver meaningful competition".
This meant BT had been put in a strong position by the Department of Culture, Media and Sport (DCMS) making it more difficult for customers to insist on value for money, according to PAC.
Margaret Hodge, who chairs PAC, said: "Since our hearing in July last year, when 26 of the 44 contracts to deliver this were with BT, all remaining contracts have now also gone to BT.
"Despite our warnings last September, the Department for Culture, Media and Sport has allowed poor cost transparency and the lack of detailed broadband rollout plans to create conditions whereby alternative suppliers may be crowded out."
Ofcom have defended internet providers after reviewing the ability of companies like BT and Sky to stick to a voluntary code of practice.
A spokeswoman for the industry watchdog admitted there were some areas that needed to be "strengthened further" but said "overall the code is working effectively".
Ensuring consumers receive a high quality of service from their broadband provider and are fairly treated are high priorities for Ofcom.
That is why, in 2008, we introduced a broadband speeds voluntary code of practice to ensure consumers are protected...
Mystery shopping conducted last year by Ofcom revealed that, overall, the code is working effectively.
We have, however, already identified areas where it might be strengthened further and have discussed improvements with providers to better serve consumers.
We expect to publish a revised code of practice in the coming months.
Over a third of broadband customers said they have an internet connection which frequently drops out, a survey from Which? revealed.
According to the consumer group:
- One in seven have not been able to connect to the internet at all on more than one occasion.
- Of the 45% experiencing slow speeds, 58% said this was a frequent or constant problem.
- Poor customer service was also exposed by the survey - Around one quarter (27%) have waited more than two days for after reporting a loss for anything to be done.
- Some 11% waited a week or more.
- The watchdog found 31% who contacted their provider with a problem did not get a resolution at all.