Save a bundle of cash by bundling!

by Cliff D'Arcy on 16 April 2011  |  6 comments
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Could you save £300 a year by bundling broadband, phone and TV together?

The language of selling is packed with jargon, buzzwords and acronyms.

For example, phrases such as 'vertical integration', 'multi-customers' and 'cross-selling' all boil down to the same thing: we want you to buy more of our products. In effect, this language has one aim: to help companies to pick more money from your pocket.

A bundle of trouble

Of course, in order to extract more money out of us, many companies employ 'bundling' strategies. Bundling involves combining separate products into one package and -- in theory -- selling the bundle for a lower price than these items would cost separately.

Alas, from my experience, bundling usually stacks up as a bad deal for customers.

For example, take packaged current accounts, which charge, say, £150 a month for combined benefits of dubious value. Often, these bundles prove to be expensive or inadequate and, therefore, not worth the monthly fees levied.

Saving a bundle

However, there is one place where buying a bundle can save you a bundle -- on home communications and entertainment. There are mighty savings to be made from buying your home telephone, broadband, digital television (and even your mobile phone) from one supplier.

Indeed, according to Broadbandchoices.co.uk, a typical British household could save over £300 a year by bundling broadband, telephone and TV into a single package. Here's one example of an impressive saving made by switching to a bundle:

Unbundled

Bundled

* First-year cost; includes free installation and offer of £60 credit to bill

As you can see, this bundle would save £305.04 in the first year. In other words, it puts £25 a month back in the bank!

Loyalty is for dogs

As I often remark, "Loyalty is for dogs". In other words, you get much better deals by shopping around than you do by staying faithful to existing suppliers.

However, Broadbandchoices.co.uk's research found that over a quarter (28%) of British households are missing out on significant savings, simply because they don't bundle their broadband with other services.

Digging deeper, this survey found that two in five adults (40%) didn't opt for a bundle because they didn't believe it would offer better value for money. Another fifth (21%) argued that they did not believe the bundled service would be satisfactory. Also, 16% said it was too much hassle to switch to a single company.

Bag a better deal

In fact, providers of bundled home-entertainment services (such as BT, Sky and Virgin Media) constantly come up with new deals and incentives in the fight to win new customers.

Hence, it pays to shop around carefully before choosing the latest, greatest deal -- especially with the cost of living rising so steeply of late.

Top tips for building a bundle

Before you opt for the convenience of one having only one monthly bill for phone, broadband and TV, here are six tips to find your perfect bundle:

1. Shop online: for the best deals and exclusive offers, always shop around online. Compare your current deal with the latest offers using a price-comparison calculator approved and accredited by Ofcom (the communications regulator), such as that offered by Broadbandchoices.co.uk.

2. Be realistic: buy only what you really need. If you spend, say, two hours a day watching iPlayer or downloading music and films, then you really need broadband with a 20GB+ or ‘unlimited' usage allowance. If you don't surf quite so hard, then a basic 20GB or lower allowance should be fine.

3. Broadband speeds: if you're a light internet user, super-high speeds and unlimited downloads won't be that important to you. However, if you have several home computers competing for bandwidth, then now could be the time to upgrade to a fast 20Mb+ connection. Phone line-based broadband can offer high-speed surfing, but the fastest connections come via Virgin Media's cable technology.

4. Home phone: choose a call package to meet your specific needs. Do you need free evening or weekend calls (or both)? Also, check the cost of international calls and dialling mobiles, as these can prove expensive, but are easily overlooked when picking a bundle.

5. TV channels: each provider offers slightly different combinations/packs of channels. So, be sure to do your homework by factoring in the extra monthly cost of sports packs and movie channels.

6. Functionality: if you want HD (high-definition) television, then Sky's offers are hard to beat. However, if you're more interested in video on-demand services, then Virgin Media may be a better bet.

Whatever you decide, do your research upfront, so as to get a service that works for you!

Now let's take a look at the current range of Best Buys, with the help of Broadbandchoices.co.uk:

Bundle 1: broadband and phone

Source: Broadbandchoices.co.uk

Notes

Information correct at 12/04/2011

Terms & conditions apply; see ISP sites for full details

*Subject to fair-usage policy

1. £3.49 for the first nine months; £6.99 thereafter (offer ends 19 April)

You must switch your line rental to TalkTalk for £12.60 per month (BT: £13.60)

2. £4.99 a month offer exclusive to Broadbandchoices.co.uk (offer ends soon)

You must switch your line rental to Primus for £11 per month (BT: £13.60)

3. Free for four months; £8 thereafter (offer ends 30 April)

You must switch your line rental to Tesco for £11.40 per month (BT: £13.60)

4. Free for three months; £7.50 thereafter. Free HP printer offer exclusive to Broadbandchoices.co.uk (offer ends soon)

You must switch your line rental to Orange for £11.50 per month (BT: £13.60)

Orange Mobile customers only

5. Free for three months; £8.50 thereafter (offer ends 30 April)

You must switch your line rental to O2 for £7.50 per month (BT: £13.60)

O2 mobile customers only

Bundle 2: DIY bundle for broadband and phone

If you don't want to buy a bundle, then why not make your own tailored package? For example, by combining cheap line rental with low-priced broadband, you can get more communications for less cash.

Here's one budget-busting, do-it-yourself deal we've created:

Source: Broadbandchoices.co.uk

Total cost: £164.35

Notes

Information correct at 12/04/2011

Terms & conditions apply; see ISP sites for full details

*Subject to fair-usage policy

1. £6.79 Line rental saver offer exclusive to Homephonechoices.co.uk

2. If you live in a low-cost area, then the cost is £6.49 a month. If you live outside one of these areas, then the cost is £6.49 a month for the first three months, then £10.79 or £12.99 a month, depending on where you live.

Bundle 3: broadband, phone and TV

Source: Broadbandchoices.co.uk

Notes

Information correct at 12/04/2011

Terms & conditions apply; see ISP sites for full details

*Subject to fair-usage policy

1. You must switch your line rental to Virgin Media for £12.99 per month (BT £13.60)

£50 off applied to your first bill (offer ends soon)

Service available in Virgin Media-cabled streets only

2.  Free Sky+ box and £25 M&S vouchers (offer ends soon)

Sky Broadband Connect (8Mb) is available for £17 per month if you are outside Sky's network area

3. You must switch your line rental to BT (£13.60 per month)

£25 Amazon.co.uk Gift Certificate (offer ends 27 April)

Grab a boost from bundling

In summary, if you're looking to cut costs in your home, then please don't overlook bundles. They could give your household budget a big boost!

More: Find your perfect broadband bundle | You’re wasting £200 a year on your mobile | Here comes the spring energy rip-off!