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Inflexible business contracts a major roadblock to UK economic recovery and growth, Virgin Media O2 Business finds

 

  • More than two in five (42%) senior IT managers view signing multi-year contracts as “risky” in the current climate and nearly half (44%) of those looking for IT support say they’re paying for services they don’t need
  • 94% believe that investment in new digital services will help their businesses bounce back from Covid-19
  • But there’s a long way to go, with more than half (57%) not believing their business is agile enough

Lengthy and inflexible contracts are preventing businesses from bouncing back from the pandemic, according to new research from Virgin Media O2 Business.

The study has found that almost half of senior IT managers (44%) looking for support say they are locked into restrictive contracts and paying for services they don’t need and a third (36%) say renegotiating fixed-term contracts is a barrier to operating more flexibly and making bold decisions over the next 18-24 months.

The research coincides with Virgin Media Business’ launch of ‘UltimateFlex’, a new contracting model for wholesale services which offers customers anytime cancellation as standard for managed ethernet, internet access and high capacity services.

The survey reveals more than 9 in 10 senior IT managers believe investment in new digital services will help their business bounce back from Covid-19.

However, almost three in five (57%) do not believe their business is agile enough and say it is unable to flex tools and infrastructure or make swift decisions in response to changing conditions.

Almost half (47%) of those looking for IT support say that committing to long-term contracts involves significant upfront fees which their business cannot afford while 42% see signing up to multi-year contracts as risky in the current climate.

To help businesses get back on their feet, Virgin Media Business has also removed installation charges as standard on wholesale products as part of UltimateFlex, meaning almost all circuits can be booked with nothing to pay upfront. The operator has also removed excess construction charges, helping partners reduce risk and manage cashflow with no unexpected upfront costs.

More than two in five (43%) senior IT managers who would like more support from their connectivity provider want the flexibility to end contracts with partners penalty-free, citing it as one of the most important things they could do to support future growth over the next 18 months.

With the operator’s UltimateFlex contracts, wholesale partners have the confidence they are always receiving the best price for life – as pricing for installed services is automatically adjusted in-line with the latest acquisition offers.

Mike Hallam, Director of Fixed Wholesale at Virgin Media O2 Business, said: “Businesses are crying out for more flexibility, certainty and value to unlock the power of digital technology and bounce back stronger.

“After a bruising year, we’re giving partners a leg up with our radical new model which abolishes upfront fees, provides lifetime price confidence and comes with anytime cancellation so they have the tools they need to thrive whatever comes next.”

Virgin Media O2, which launched in June 2021, is a new joint venture between Liberty Global and Telefónica in the UK. The new business has become one of the UK’s largest, with 47 million connections across broadband, mobile, TV and home phone, and offers connectivity services, applications and digital solutions to tens of thousands of UK businesses and public sector organisations.

While there is no change to existing services today, plans are well underway to offer seamless broadband, entertainment and mobile services all in one place, under one roof, later this year. Through a dedicated function, business and public sector customers are set to benefit from a richer suite of products and collective expertise from Virgin Media O2 Business. This includes a variety of managed connectivity services and flexible working capabilities, security, data insight, 5G private networks and cloud solutions, as well as wholesale services to other operators and partners.

About the Survey

The survey, conducted over one week in May and June 2021 by Censuswide, consulted 250 senior IT decision makers from UK organisations of at least 50 employees.

Virgin Media Business recently announced its plan to transform the wholesale connectivity market by enabling partners to take wholesale ethernet, Dedicated Internet Access (leased line) and High Capacity Services (HCS) on a cancel anytime, flexible contract. Read more about UltimateFlex here.

 About Virgin Media O2 Business

Virgin Media O2 launched on 1 June 2021, combining the UK’s largest and most reliable mobile network with a broadband network offering the fastest widely-available broadband speeds. It is a customer-first organisation that brings a range of connectivity services together in one place with a clear mission: to upgrade the nation. Virgin Media O2 is the corporate brand of the 50:50 joint venture between Liberty Global and Telefónica SA, and one of the UK’s largest businesses.

The company has 47 million UK connections across broadband, mobile, TV and home phone. Its own fixed network currently passes 15.4 million premises alongside a mobile network that covers 99% of the nation’s population with 4G, and 180 towns and cities with 5G services. Virgin Media O2 is committed to delivering gigabit broadband speeds across its entire network footprint by the end of 2021.

Virgin Media O2 is a major investor in the UK. It employs around 18,000 people, has more than 430 retail stores and has committed to invest at least £10 billion over the next five years.

As integration work progresses at pace, both Virgin Media and O2 continue to offer their respective products to customers, with new, joint services launching soon.

Today, the business delivers award-winning broadband and WiFi connectivity to homes as well as providing a connected entertainment service. This brings together live TV, thousands of hours of on-demand programming and a wide-selection of apps to customers through a set-top box and on-the-go through tablets and smartphones.

It also provides 2G, 3G, 4G and 5G mobile services, and is the network of choice for mobile virtual network operators giffgaff, Sky Mobile and Lycamobile, as well as managing a 50:50 joint venture with Tesco for Tesco Mobile.

Virgin Media O2 Business plays a leading role in supporting the public sector and businesses of all sizes. This includes a variety of managed connectivity services and flexible working capabilities, security, data insight, 5G private networks and cloud solutions, as well as wholesale services to other operators and partners

Awards for Virgin Media and O2’s telecommunications services include recognition by GWS for having the most reliable UK mobile network for three years in a row (2021, 2020, and 2019) and winning the publicly voted Uswitch awards in 2021 for the fourth consecutive year for Best Network Coverage (mobile) and Fastest Broadband Provider.

Virgin Media O2 is committed to using the power of connectivity to supercharge communities across the UK, taking action to close the digital divide and helping to build an inclusive, resilient, and low carbon economy. The company has an ambition to achieve net zero carbon operations (scopes 1 & 2) by the end of 2025.

 

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