The digital upgrade

We say long-term contracts are unfair on small businesses. Here’s why.

Posted by Casey Solomon

As a small business, you need to be sure you’re getting the best value for every penny you spend. But with a baffling array of broadband deals available it’s not always easy to spot a good one.

Most of the big broadband names will offer you an 18 month broadband contract; if you’re lucky you may find the odd 12-month one. Many are as long as 24 months or even +36 months. And once you’re tied into one of these contracts it’s incredibly hard to leave, at least without paying a hefty cancellation fee… unless you know your rights!

At bOnline, we say it’s totally unfair on UK small business owners to have to tie themselves in to long contracts of more than 12 months. In fact, we think that contracts of more than 12 months should be banned. The needs of small businesses can change quickly, and business owners should be able to leave a contract as soon as it’s not giving them the best value.

On top of this, larger internet providers have increased their prices lately, not just by CPI to cover inflation but by an extra 3.9% on top. Again, we think this is unfair and puts an extra strain on small businesses at a time when costs are skyrocketing. Find out how our customers are avoiding the biggest price hikes in 2023.

What’s the difference between home and business broadband?

This is a question we get asked a lot, and the supply of both business and home broadband is actually the same for the most part. You get a router in the post which connects you up to the same cable networks (usually BT Openreach or another altnet provider’s infrastructure). Every month, you then pay a fixed fee for your broadband for however long your contract lasts.

However, where home and business broadband do vary is when it comes to the type and range of contracts on offer. When you buy business broadband, you’ll also get a more advanced router which can cope with more connections than your usual home hub can.

There’s plenty of information about contracts on the Ofcom website which is well worth reading through.

What is the definition of a business broadband consumer?

As the name suggests, a business broadband consumer is someone who is using their broadband connection to run a business. This could be anything from a microbusiness (one person, or fewer than 10 employees with a turnover or balance sheet of less than €2 million) up to a large multinational.

A business broadband consumer is essentially someone who is looking for a commercial-grade, high-speed internet solution that comes with added features like dedicated customer support backed up by a strong service-level agreement (SLA). They also require much more reliability with a wide geographical range. When downtime costs money, business broadband is the solution.

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Why do minimum broadband contracts matter to small businesses?

It’s important to choose the best broadband contract that fits your business needs. This is not just in terms of speed but also connection reliability, contract length and the terms of your contract. The length of your contract is also called the ‘minimum term period’.

If you want to cancel your business broadband contract and use a different provider before your contract has ended, make sure you’re clear about what this will cost you. Some exit fees are substantially higher with some providers than with others. Again, there’s a wealth of information available about switching providers on the Ofcom website.

Don’t forget, if you are a small business customer (with ten employees or fewer) you can now actually be treated the same as a residential customer. That is to say, your contract should be no more than 24 months maximum. Your contract should also not be extended if you purchase additional services, unless you’ve expressly given permission. 

When looking for a business broadband provider, check the terms and conditions closely. This will tell you about any excessive early termination fees, as well as how long you need to give as a notice period.

Short broadband contracts offer greater flexibility and benefits

The biggest advantage to having a much shorter business broadband contract is it gives you far more flexibility. By taking out an 18 or 24 month contract you stand much more chance of your circumstances changing over time. This will likely mean penalty fees if you want to leave early. A 12 month contract is, for our customers at least, much more manageable and predictable.

By signing up for a shorter term business broadband service, you can also feel more confident of the service in your area. If for some reason you’re not happy, you’re tied in for a much shorter time. Additionally, many of our customers move premises every so often which makes a 12 month contract more appealing. Plus, if you need to set up an employee temporarily off-site on a year’s contract, 12 months broadband is ideal.

Finally, if you’re only on a 12-month broadband contract, you can negotiate with your provider at the same time each year on renewal. For example, every January if there tends to be a yearly sale on, or every Black Friday in November.

I already run my business from home. Why do I need business broadband?

If you’re a small business owner working from home, it’s tempting to just use your existing home broadband connection. However, over time you might find you need higher capacity or better speeds, especially if you’re constantly online day in, day out. You may even have a home office where a few of you work together, necessitating a business line.

Running your business from outside your home? Business broadband is still the best route to take. While the prices are really similar to home broadband (in our case often a lot cheaper in fact), you get extra support if you need anything fixed. So you’ll have a dedicated support team to call on if your line goes down or if there’s a technical issue. Plus, as mentioned previously, you’ll get a powered up router that can cope with more people being online at once.


Choose your number to get started

All our business broadband contracts last for 12 months only

Whether you go for one of our super reliable broadband offers or jump in with full fibre, all our contracts only last for 12 months. After that you’re free to renew or try elsewhere - the choice is totally up to you.

Automatically renewable contracts: We don’t like those either

An automatically renewable contract is one which automatically rolls over to a new minimum contract period - with chargeable fees for leaving - unless you actively opt out of the renewal in good time.

Internet providers for small businesses (i.e those with a maximum of ten employees), aren’t actually allowed to renew contracts automatically and do need your consent. However if you have more than ten employees it’s worth checking your contract terms as you may find autorenewal applies. Again, make sure you know what you’re signing up to.

Contract Summary & Information - Know your rights

As a new customer, you’re now entitled to get certain details up front before you agree to a new contract. This will help you make a more informed decision before signing on the dotted line.

Since June 2022, all ISPs must provide customers with two things: A contract information document and a contract summary document. The contract information document lays out everything you need to know about your contract in detail, including information about the company, the contract terms, connection speeds etc. The contract summary is then a short, one-page summary of the main contract terms. It’s never more than one page long, and will also include clear examples of how any price increases will affect the price you’ll pay. Additionally, it will set out what happens if you want to leave the contract before it finishes.

The new rules were brought in to help you avoid being stung by surprise price rises, particularly during these tough economic times. The summary must also include important details like monthly price, broadband speeds and contract length.

If you're ready to take the next step or would like expert advice on finding the right business broadband or fibre package for you, contact bOnline on 0203 617 9950.