Ofcom introduced automatic compensation for consumers in 2019. The scheme increased compensation payments and resulted in more steps being taken to fix issues.
Now Vorboss has urged the regulator to introduce a comparable scheme to protect UK businesses.
The call comes as the company’s investigation into productivity has revealed that the UK economy has suffered a £17.6 billion loss in economic output over the past 12 months due to connectivity outages. The total for London alone was £5.7 billion, representing just over 1 per cent of the capital’s GDP.
The average UK business lost more than £11,000 in economic output as a result of connectivity outages in the past year. For businesses based in London, the loss was £18,620. That loss of economic value is due to an average 314 lost hours of productivity per London business.
To introduce competition around quality and help improve the performance of business connectivity networks, Vorboss has written to Ofcom to encourage the introduction of an automatic compensation scheme for fixed business connectivity providers.
Vorboss has also offered to be a founding member of the scheme as it introduces automated compensation for its own new and existing customers.
Tim Creswick, founding CEO at Vorboss, said, "As the data in this report shows, the productivity uplift that would come from improved network quality is massive.
"We should all be incentivised to compete on quality – that would force an uplift in network performance, and in turn drive a much-needed economic boost.
"Ofcom's introduction of automatic compensation in the consumer market has been a success, pushing service providers to improve quality, while giving customers reassurance that compensation is real and tangible. If the scheme was extended to include businesses, we would see the same benefits, along with a significant productivity boost to London and the UK economy through reduced outages."
More than half (51 per cent) of businesses with a fixed business internet contract reported that they experienced at least one loss of service in the past year. That figure rises to 60 per cent for London’s businesses. Almost a fifth (19 per cent) of businesses experienced three or more outages in the past year. In London, 28 per cent of businesses were hit three or more times.
Yet, 61 per cent of businesses that experienced an outage did not receive any compensation. Of those that didn't ask for it, the two most cited reasons were that requesting compensation was not worth the time and effort (44 per cent) and they didn't expect to get compensation (34 per cent).
Despite Ofcom's previous interventions to improve business engagement with Service Level Agreements and compensation, subsequent research has revealed low awareness of these provisions among businesses, alongside high dissatisfaction with the level of compensation provided. Government extended the 'growth duty' to Ofcom and other industry regulators in 2023, asking that they consider the growth of the UK economy in their decision-making process.
Vorboss is launching automatic compensation to new and existing business customers served by its network across its direct and wholesale channels. If Vorboss business internet goes down for more than four minutes, customers will automatically be compensated with at least one day's worth of service credits. If it is down for more than 24 hours, customers will receive the full pay-out of two months' worth of service credits.
The Vorboss report was written by Assembly Research, incorporating ONS data and data from a YouGov survey commissioned in February 2024.